UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant x☒
Filed by a Party other than the Registrant ¨☐
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EXXON MOBIL CORPORATION
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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and Proxy Statement | ||||
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April |
Dear Shareholder:
We invite you to attend the annual meeting of shareholders on Wednesday, May 25, 2016,29, 2019, at the Morton H. Meyerson SymphonyRenaissance Dallas Hotel Conference Center, 2301 Flora Street,2222 North Stemmons Freeway, Dallas, Texas 75201.75207. The meeting will begin promptly at 9:30 a.m., Central Time. At the meeting, you will hear a report on our business and vote on the following items:
Election of directors;
Ratification of PricewaterhouseCoopers LLP as independent auditors;
Advisory vote to approve executive compensation as required by law;
Seven shareholder proposals contained in this proxy statement; and
Other matters if properly raised.
Only shareholders of record on April 6, 2016,3, 2019, or their proxy holders may vote at the meeting. Attendance at the meeting is limited to shareholders or their proxy holders and ExxonMobil guests. Only shareholders or their valid proxy holders may address the meeting.
This booklet includes the formal notice of the meeting and proxy statement. The proxy statement tells you about the agenda, procedures, and rules of conduct for the meeting. It also describes how the Board operates, gives information about our director candidates, and provides information about the other items of business to be conducted at the meeting.
This year, we initiated the use of “Notice and Access” for delivery of proxy information to many shareholders, thereby capturing cost and environmental benefits. These shareholders will receive by mail aNotice Regarding the Availability of Proxy Materials on the Internet. The notice will also contain instructions on how to request paper copies of all proxy materials, if desired.
Financial information is provided separately in the booklet, 20152018 Financial Statements and Supplemental Information, enclosed with the proxy materials or made available online to all shareholders.
Your vote is important to us.Evenimportant.Even if you own only a few shares, we want your shares to be represented at the meeting. You can vote your shares by Internet, toll-free telephone call, or proxy card. ASummary of 2019 Proxy Voting Resultswill be available atexxonmobil.com after the annual shareholders meeting.
To attend the meeting in person, please follow the instructions on page 3.6. An audio webcast with slide presentation and a report on the meeting will be available on our website atexxonmobil.comexxonmobil.com..
Sincerely,
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Neil A. Hansen Secretary | Darren W. | |||
Woods Chairman of the Board |
Table of ContentsTABLE OF CONTENTS
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4 | ||||
7 | ||||
49 | ||||
58 | ||||
| 59 | |||
61 | ||||
Item 8 – Report on Risks of Gulf Coast Petrochemical Investments | 64 | |||
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| 67 | |||
| 69 | |||
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Shareholders are asked to consider the materials included in this proxy statement and to vote on the following:
ITEM 1 Election of Directors The Board recommends you voteFOR each of the following candidates. |
The Board of Directors has nominated the director candidates below. All of our nominees currently serve as ExxonMobil directors. All director nominees have stated that they are willing to serve if elected. | Personal information about each nominee is provided beginning onpage 19. |
Name, Age | Director Since | ExxonMobil Board Committees | Other Public | |||||||||||||
AC | CC | BAC | FC | PICC | EC | |||||||||||
Susan K. Avery, 69 President Emerita, Woods Hole Oceanographic Institution | 2017 | ✓ | ✓ | None | ||||||||||||
Angela F. Braly, 57 Former Chairman of the Board, President, and CEO, WellPoint (now Anthem) | 2016 | ✓ | C | Brookfield Asset Management; Lowe’s; Procter & Gamble | ||||||||||||
Ursula M. Burns, 60 Chairman of the Board and CEO, VEON | 2012 | C | ✓ | ✓ | Nestlé; VEON | |||||||||||
Kenneth C. Frazier, 64 Chairman of the Board, President, and CEO, Merck & Co. | 2009 | ✓ | C | ✓ | Merck | |||||||||||
Steven A. Kandarian, 67 Chairman of the Board, President, and CEO, MetLife | 2018 | ✓ | ✓ | MetLife; AECOM | ||||||||||||
Douglas R. Oberhelman, 66 Former Chairman of the Board and CEO, Caterpillar | 2015 | ✓ | ✓ | Bombardier | ||||||||||||
Samuel J. Palmisano, 67 Former Chairman of the Board, President, and CEO, IBM | 2006 | C | ✓ | ✓ | American Express | |||||||||||
Steven S Reinemund, 71 PD Former Chairman of the Board and CEO, PepsiCo | 2007 | ✓ | ✓ | ✓ | GS Acquisition Holdings; Marriott; Walmart | |||||||||||
William C. Weldon, 70 Former Chairman of the Board and CEO, Johnson & Johnson | 2013 | ✓ | ✓ | CVS Caremark; JPMorgan Chase | ||||||||||||
Darren W. Woods, 54 C Chairman of the Board and CEO, Exxon Mobil Corporation | 2016 | C | C | None | ||||||||||||
C | Chairman | AC | Audit Committee | FC | Finance Committee | |||||
PD | Presiding Director | CC | Compensation Committee | PICC | Public Issues and Contributions Cmt. | |||||
✓ | Member | BAC | Board Affairs Committee | EC | Executive Committee |
2019 Proxy Statement | ![]() | 1 |
Director Attendance
During 2018, the ExxonMobil Board met nine times. Directors, on average, attended approximately 99 percent of Board and committee meetings during 2018. No director attended less than 75 percent of such meetings. ExxonMobil’snon-employee directors held seven executive sessions in 2018.
9 | 99% | |
Board meetings during 2018 |
Director average attendance |
Board Highlights
The ExxonMobil Board is comprised of directors with a diverse mix of backgrounds, knowledge, and skills.
“ExxonMobil recognizes the strength and effectiveness of the Board reflects the balance, experience, and diversity of the individual directors; their commitment; and importantly, the ability of directors to work effectively as a group in carrying out their responsibilities. ExxonMobil seeks candidates with diverse backgrounds who possess knowledge and skills in areas of importance to the Corporation.”
– ExxonMobil Director Selection Guidelines
Board Tenure
The Board actively refreshes its membership, reflected in an average tenure fornon-employee directors that is lower than the applicableStandard & Poor’s 500 average of 8.1 years.
6.5 | ||
Average tenure ofnon- employee directors |
ExxonMobil’s director competencies/profiles include:
Risk Management
10 of 10 Directors
Large/Complex Organizations
10 of 10 Directors
Scientific/Technical/Research
7 of 10 Directors
Current/Former CEO/Field Prominence
10 of 10 Directors
Gender Diversity
3 of 10 Directors
Race/Ethnic Diversity
2 of 10 Directors
Independence
9 of 10 Directors
Additional information about director
leadership and oversight can be found beginning onpage 7.
Additional information about director
qualifications and competencies can be found beginning onpage 9.
Additional information about director
tenure can be found onpage 12.
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ITEM 2 Ratification of Independent Auditors The Board recommends you voteFOR this proposal. |
The Audit Committee has appointed PricewaterhouseCoopers LLP (“PwC”) to audit ExxonMobil’s financial statements for 2019. | Additional information about the Audit Committee’s appointment of PwC and PwC’s fees for 2017 and 2018 can be found beginning onpage 27. | |||||
You are asked to ratify that appointment. | ||||||
ITEM 3 Advisory Vote to Approve Executive Compensation The Board recommends you voteFOR this proposal. |
ExxonMobil asks you to vote on anon-binding resolution to approve the compensation of the Named Executive Officers. | Additional information about ExxonMobil’s compensation program can be found beginning onpage 30. | |||||
ITEMS 4 through 10 Shareholder Proposals The Board recommends you voteAGAINST each of these proposals. |
You will have the opportunity to vote on shareholder proposals submitted to ExxonMobil. | The text of these proposals, the proponents’ statements in support, and ExxonMobil’s responses can be found beginning onpage 58. |
2019 Proxy Statement | ![]() | 3 |
Who May Vote
Shareholders of ExxonMobil, as recorded in our stock register on April 6, 2016,3, 2019, may vote at the meeting.
How to Vote
You may vote in person at the meeting or by proxy. We recommend you vote by proxy even if you plan to attend the meeting. You can always change your vote at the meeting.
Important Notice Regarding the Availability of Proxy Materials for the ShareholderShareholders Meeting to be held on May 25, 201629, 2019:
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Notice and Access
This year we have elected toWe distribute proxy materials to many shareholders via the Internet under the Securities and Exchange Commission’s (SEC’s)(“SEC’s”) “Notice and Access” rules, thereby capturing cost and environmental benefits. On or about April 13, 2016,11, 2019, we mailed a Notice Regarding the Availability of Proxy Materials (“Notice”) that contains information about our 2016 Annual Shareholders Meeting2019 annual shareholders meeting and instructions on how to view all proxy materials on the Internet. Also included are instructions on how to vote and how to request a paper ore-mail copy of the proxy materials.
Electronic Delivery of Proxy Statement and Annual Report Documents
For shareholders receiving proxy materials by mail, you can elect to receive ane-mail in the future that will provide electronic links to these documents. Opting to receive your proxy materials online will save the Company the cost of producing and mailing documents to your home or business, and will also give you an electronic link to the proxy voting site.
• | Shareholders of Record:If you vote on the Internet atwww.investorvote.com/exxonmobil, |
Beneficial Shareholders:If you hold your shares in a brokerage account, you may also have the opportunity to receive copies of the proxy materials electronically. Please check the information provided in the proxy materials mailed to you by your bank or broker regarding the availability of this service.
How Proxies Work
ExxonMobil’s Board of Directors is asking for your proxy. Giving us your proxy means you authorize us to vote your shares at the meeting in the manner you direct.
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If your shares are held in your name, you can vote by proxy in one of three convenient ways:
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Via | By telephone | In writing | ||
Follow the instructions at www.investorvote.com/ You will need to have your proxy card or Notice in hand. At this website, you can elect to access future proxy statements and annual reports via the Internet. | Call toll-free1-800-652-8683 or 1-781-575-2300 (outside the United States, Canada, and Puerto Rico), and follow the instructions. You will need to have your proxy card or Notice in hand. | Complete, sign, date, and return your proxy card in the enclosed envelope. If you receive a Notice and would like to vote in writing, please follow the instructions in the Notice to obtain paper proxy materials. |
Your proxy card covers all shares registered in your name and shares held in your Computershare Investment Plan account. If you own shares in the ExxonMobil Savings Plan for employees and retirees, your proxy card also covers those shares.
If you give us your signed proxy but do not specify how to vote, we will vote your shares as follows:
For the election of our director candidates;
For ratification of the appointment of independent auditors;
For approval of the compensation of the Named Executive Officers; and
As recommended by the Board with respect to shareholder proposals.
If you hold shares through someone else, such as a stockbroker, you will receive materialmaterials from that firm asking how you want to vote. Check the voting form used by that firm to see if it offers Internet or telephone voting.
Voting Shares in the ExxonMobil Savings Plan
The Trustee of the ExxonMobil Savings Plan will vote Plan shares as participants direct. To the extent participants do not give instructions, the Trustee will vote shares as it thinks best. The proxy card serves to give voting instructions to the Trustee.
Revoking a Proxy
You may revoke your proxy before it is voted at the meeting by:
Submitting a new proxy with a later date via a proxy card, the Internet, or by telephone;
Notifying ExxonMobil’s Secretary in writing before the meeting; or
Voting in person at the meeting.
Confidential Voting
Independent inspectors count the votes. Your individual vote is kept confidential from us unless special circumstances exist. For example, a copy of your proxy card will be sent to us if you write comments on the card.
Quorum
In order to carry on the business of the meeting, we must have a quorum. This means at least a majority of the outstanding shares eligible to vote must be represented at the meeting, either by proxy or in person. Treasury shares, which are shares owned by ExxonMobil itself, are not voted and do not count for this purpose.
2019 Proxy Statement | ![]() | 5 |
Votes Required
Election of Directors Proposal:A plurality Under ExxonMobil’s bylaws, a director nominee must receive a majority of the votes cast is required forin order to be elected to the Board of Directors in anon-contested election. In a contested election (in which the number of directors. This means thatnominees exceeds the number of directors to be elected), the plurality vote standard under New Jersey law would apply. Under plurality voting, the director nominee with the most votes for a particular seat is elected for that seat. Only votes FOR or WITHHELD count. Abstentions and brokernon-votes are not counted for purposes of the election of directors. A brokernon-vote occurs when a bank, broker, or other holder of record that is holding shares for a beneficial owner does not vote on a particular proposal because the record holder does not have discretionary voting power for that particular item and has not received instructions from the beneficial owner.If you own shares through a broker, you must give the broker instructions to vote your shares in the election of directors. Otherwise, your shares will not be voted.
Our Corporate Governance Guidelines, which can be found in the Corporate Governance section of our website atexxonmobil.com/guidelinesgovernance,, state that all directors will stand for election at the annual meeting of shareholders. In anynon-contested election of directors, any director nominee who receives a greater number of votes WITHHELD fromAGAINST his or her election than votes FOR such election shall tender his or her resignation. Within 90 days after certification of the election results, the Board of Directors will decide, through a process
managed by the Board Affairs Committee and excluding the nominee in question, whether to accept the resignation. Absent a compelling reason for the director to remain on the Board, the Board shall accept the resignation. The Board will promptly disclose its decision and, if applicable, the reasons for rejecting the tendered resignation on Form8-K filed with the Securities and Exchange Commission (SEC).Commission.
Other Proposals:Approval of the ratification of the appointment of independent auditors, the advisory vote to approve executive compensation, and the shareholder proposals requiresrequire the favorable vote of a majority of votes cast. Only votes FOR or AGAINST these proposals count.
Abstentions count for quorum purposes, but not for voting. Brokernon-votes count as votes FOR the ratification of the appointment of independent auditors but do not count for voting on any of the other proposals.
Annual Meeting Admission
Only shareholders or their proxy holders and ExxonMobil guests may attend the meeting.
For safety and security reasons, cameras, smartphones, recording equipment, electronic devices, computers, large bags, briefcases, packages, and firearms or other weapons will not be permitted in the building.buildingIn.In addition, each shareholder and ExxonMobil guest will be asked to present valid government-issued picture identification, such as a driver’s license, before being admitted to the meeting.
For registered shareholders, an admission ticket is the upper part of your proxy card or the full Notice. Please bring the admission ticket with you to the meeting.
If your shares are held in the name of your broker, bank, or other nominee, you must bring to the meeting an account statement or letter from the nominee indicating that you beneficially owned the shares on April 6, 2016,3, 2019, the record date for voting. You may receive an admission ticket in advance by sending a written request with proof of ownership to the address listed on the next pagebelow under Contact Information.
Shareholders who do not present admission tickets at the meeting will be admitted only upon verification of ownership at the admission counter.
Audio Webcast of the Annual Meeting
You are invited to visit our website atexxonmobil.comto hear the audio webcast with slide presentation at 9:30 a.m., Central Time, on Wednesday, May 25, 2016.29, 2019. An archived copy of this audio webcast will be available on our website for one year.
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Conduct of the Meeting
The Chairman has broad responsibility and legal authority to conduct the annual meeting in an orderly and timely manner. This authority includes establishing rules for shareholders who wish to address the meeting. Only shareholders or their valid proxy holders may address the meeting. Copies of these rules will be available at the meeting. The Chairman may also exercise broad discretion in recognizing shareholders who wish to speak and in determining the extent of discussion on each item of business. In light of the number of business items on this year’s agenda and the need to conclude the meeting within a reasonable period of time, we cannot ensure that every shareholder who wishes to speak on an item of business will be able to do so.
Dialogue can usually be better accomplished with interested parties outside the meeting and, for this purpose, we have provided a method on our website atexxonmobil.com/directors for raising issues and contacting thenon-employee directors either in writing or electronically. The Chairman may also rely on applicable law regarding disruptions or disorderly conduct to ensure that the meeting is conducted in a manner that is fair to all shareholders. Shareholders making comments during the meeting must do so in English so that the majority of shareholders present can understand what is being said.
Contact Information
If you have questions or need more information about the annual meeting, write to Mr. Jeffrey J. Woodbury, Secretary, Exxon Mobil Corporation, 5959 Las Colinas Boulevard, Irving, TX 75039-2298. Alternatively, call us at 1-972-444-1157 or send a fax to 1-972-444-1505.
Contact Information If you have questions or need more information about the annual meeting, write to Mr. Neil A. Hansen, Secretary, Exxon Mobil Corporation, 5959 Las Colinas Boulevard, Irving, TX 75039-2298. Alternatively, call us at1-972-940-6715 or send a fax to1-972-940-6748. For information about shares registered in your name or your Computershare Investment Plan account, call ExxonMobil Shareholder Services at1-800-252-1800 or1-781-575-2058 (outside the United States, Canada, and Puerto Rico), or access your account via the website atwww.computershare.com/exxonmobil. We also invite you to visit ExxonMobil’s website, where investor information can be found atexxonmobil.com/investor.For information about shares registered in your name or your Computershare Investment Plan account, call ExxonMobil Shareholder Services at 1-800-252-1800 or 1-781-575-2058 (outside the United States, Canada, and Puerto Rico), or access your account via the website atwww.computershare.com/exxonmobil. We also invite you to visit ExxonMobil’s website atexxonmobil.com. Investor information can be found atexxonmobil.com/investor. Website materials are not part of this proxy solicitation.
CORPORATE GOVERNANCECorporate Governance
Overview
The Board of Directors and its committees perform a number of functions for ExxonMobil and its shareholders, including:
Overseeing the management of the Company on your behalf, including oversight of risk management;
Reviewing ExxonMobil’s long-term strategic plans;
Exercising direct decision-making authority in key areas, such as declaring dividends;
Selecting the CEOChief Executive Officer (“CEO”) and evaluating the CEO’s performance; and
Reviewing development and succession plans for ExxonMobil’s top executives.
The Board has adopted Corporate Governance Guidelines that govern the structure and functioning of the Board and set out the Board’s position on a number of governance issues. A copy of our current Corporate Governance Guidelines is posted on our website atexxonmobil.com/guidelines.
All ExxonMobil directors stand for election at the annual meeting. Non-employee directors cannot stand for election after they have reached age 72, unlessAt least annually, the Board makes an exception on a case-by-case basis. Employee directors resign fromand each of the Board when theycommittees conduct an evaluation of its performance and effectiveness. Any potential changes to the committees’ charters are no longer employed by ExxonMobil.also considered at least once a year.
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Risk Oversight
Risk oversightRiskoversight is the responsibility of the full Board of Directors. The Board throughout the year participates in reviews with management on the Company’s business, including identified risk factors. As a whole, the Board reviews include litigation and other legal matters; political contributions, budget, and policy; lobbying costs; developments in climate science and policy; theEnergy Outlook, which projects world energy supply and demand to 2040; stewardship of business performance; and long-term strategic plans.
The Board and/or the Public Issues and Contributions Committee visit an ExxonMobil operationoperations site each year. These visits allow the directors to better understand local issues and to discuss issues such as safety, environmental performance, technology, products, industry and corporate standards, and community involvement associated with the Company’s business.
In addition, existing committees help the Board carry out its responsibility for risk oversight by focusing on specific key areas of risk:
• The Audit Committee oversees risks associated with financial and accounting matters, including compliance with legal and regulatory requirements, and the Company’s financial reporting and internal control systems. The Committee also periodically reviews cybersecurity risks and preparedness and ExxonMobil’s overall risk management approach and structure. • The Board Affairs Committee oversees risks associated with corporate governance, including Board structure and succession planning. • The Compensation Committee helps ensure that the Company’s compensation policies and practices encourage long-term focus, support the retention and development of executive talent, and discourage excessive risk taking. • The Public Issues and Contributions Committee oversees operational risks such as those relating to employee and community safety, health, environmental performance, including actions taken to address climate-related risks, and security matters. | ![]() | |
• The Finance Committee oversees risks associated with financial instruments, financial policies and strategies, and capital structure. |
The Board receives regular updates from the committees, and believes this structure is best for overseeing risk.
Board Leadership Structure
The Board believes that the decision as to who should serve as Chairman and/or CEO is the proper responsibility of the Board. The Board retains authority to amend the By-Lawsbylaws to separate the positions of Chairman and CEO at any time and will carefully consider the pros and cons of such separation or combination.At the present time, the Board believes the interests of all shareholders are best served through a leadership model with a combined Chairman/CEO position and an independent Presiding Director.
The current CEO possesses anin-depth knowledge of the Company; its integrated, multinational operations; the evolving energy industry supply and demand;demand fundamentals; and the array of challenges to be faced. This knowledge was gained through more than 4026 years of successful experience in progressively more senior positions, including domestic and international responsibilities.
The Board believes that these experiences and other insights put the CEO in the best position to provide broad leadership for the Board as it considers strategy and as it exercises its fiduciary responsibilities to shareholders. Further, the Board has demonstrated its commitment and ability to provide independent oversight of management.
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The Board is comprised entirely of independent directors except for the CEO, and President, and 100 percent of the Audit, Compensation, Board Affairs, and Public Issues and Contributions Committee members are independent. Each independent director has access to the CEO and other Company executives on request;request, may call meetings of the independent directors;directors, and may request agenda topics to be added or dealt with in more detail at meetings of the full Board or an appropriate Board committee.
In addition, after considering evolving governance practices and shareholder input regarding Board independence, the Board established the role of Presiding Director.The Board believes the Presiding Director can provideprovides effective independent Board leadership. J.S. Fishman Steven S Reinemund serves as Presiding Director and is expected to remain in the position at least through the annual meeting of shareholders. In accordance with the specific duties prescribed in the Corporate Governance Guidelines, the Presiding Director chairs and approves the agenda for executive sessions of the independent directors, which are held several times per year, normally coincident with meetings of the Board and without the CEO or other management present; chairs meetings of the Board in the absence of the Chairman; and works closely with the Chairman in developing Board agendas, topics, schedules, and in reviewing materials provided to the directors.
Director Qualifications
The Board has adopted guidelines outlining the qualifications sought when consideringnon-employee director candidates. These guidelinesGuidelines for the Selection ofNon-Employee Directors (“Selection Guidelines”), which are published on our website atexxonmobil.com/directorguidelines., are reviewed annually and state in part:
In part,“ExxonMobil recognizes the guidelines describestrength and effectiveness of the necessary experiencesBoard reflects the balance, experience, and diversity of the individual directors; their commitment; and importantly, the ability of directors to work effectively as a group in carrying out their responsibilities. ExxonMobil seeks candidates with diverse backgrounds who possess knowledge and skills expectedin areas of importance to the Corporation.”
The qualifications we consider for director candidates as follows:include:
“Candidates for non-employee director of Exxon Mobil Corporation should be individuals
Individuals who have achieved prominence in their fields, with experiencefields;
Diversity of experiences and backgrounds, including gender and race/ethnic diversity;
Experience and demonstrated expertise in managing large, relatively complex organizations, and/such as that of CEOs or in a professional or scientific capacity, be accustomed to dealing with complex situations, preferably those with worldwide scope.”
The key qualifications the Board seeks across its membership to achieve a balance of diversity and experiences important to the Corporation include: financial expertise; experience as the CEOnext-level executives of a significant company or organization or as a next-level executive with responsibilities for global operations; experience managing large, complex organizations; experienceresponsibilities;
Financial and other risk management expertise;
Experience on one or more boards of significant public ornon-profit organizations; and expertise
Expertise resulting from significant academic, scientific, or research activities. activities; and
Experience with cyclical businesses, such as commodities.
Other considerations include:
A substantial majority of the Board must meet independence standards as described in the Corporate Governance Guidelines;
All candidates must be free from any relationship with management or the Corporation that would interfere with the exercise of independent judgment;
Candidates should be committed to representing the interests of all shareholders and not any particular constituency; and
The Board also seeks diversitymust include members who satisfy legal and stock exchange requirements for certain Board committees.
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The Board is comprised of life experiences anddirectors with an effective mix of backgrounds, as well as gender and ethnic diversity.
The table below describes the particular experience, qualifications, attributes,knowledge, and skills of each director nominee that led the Board to conclude that such person should serve asconsiders helpful in fulfilling its oversight role. The chart below provides a directorsummary of the Company.collective competencies of the Board nominees and explains why these are important:
Director Qualifications | Competencies and Relevance to ExxonMobil | |||||||
Board Composition | ||||||||
Individuals who have achieved prominence in their fields | Current CEO / Former CEO / Field Prominence Experience serving as a CEO or other prominent leader provides unique perspectives to help the Board independently oversee ExxonMobil’s CEO and |
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Experience and demonstrated expertise in managing large, relatively complex organizations, such as level executives of a significant company or organization with global responsibilities | Large / Complex Organizations ExxonMobil is among the | |||||||
Global Business Leadership ExxonMobil conducts business around the world. Having a global business perspective aids the Board in understanding diverse business environments, economic conditions, and cultures associated with our global workforce and activities. | ||||||||
Operational Experience Our Company operates in many different places and under varied conditions. Having experience | ||||||||
Financial or other risk management expertise | Financial Experience ExxonMobil’s business involves complex financial management, capital allocation, and reporting issues. An understanding of | |||||||
Risk Management The scale, scope, and complexity of ExxonMobil’s business raises a multitude of interdependent risks, which can vary over time. Experience in effectively identifying, prioritizing, and managing a broad spectrum of risks can help the Board | ||||||||
or more boards of significant public ornon-profit organizations | Public Company Board | |||||||
Expertise resulting from significant academic, scientific, or research activities | Scientific / Technical / Research Experience ExxonMobil is a leader in research and | |||||||
Experience with cyclical businesses, such as commodities | Commodity / Cyclical Business Experience | |||||||
10 | ||||||
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Diversity of experiences and backgrounds, including gender and race/ethnicity, is also an important consideration for ExxonMobil Board members. The charts below reflect the gender, race/ethnicity, and age diversity of the Board.
Strong Board Gender and Race/Ethnic Diversity | ||||
Director | ||||
Our Corporate Governance Guidelines require that a substantial majority of the | ||||
Director Independence
Our Corporate Governance Guidelines require that a substantial majority of the Board consist of independent directors. In general, the Guidelines require that an independent director must have no material relationship with ExxonMobil, directly or indirectly, except as a director. The Board determines independence on the basis of the standards specified by the New York Stock Exchange (NYSE)New York Stock Exchange (“NYSE”), the additional standards referenced in our Corporate Governance Guidelines, and other facts and circumstances the Board considers relevant.
Under ExxonMobil’s Corporate Governance Guidelines, a director will not be independent if a reportable “related person transaction” exists with respect to that director or a member of the director’s family for the current or most recently completed fiscal year. See the Guidelines for Review of Related Person Transactions posted on the Corporate Governance section of our website and described in more detail under Related Person Transactions and Procedures on pages 14 to 15.13 and 14.
The Board has reviewed relevant relationships between ExxonMobil and eachnon-employee director and director nominee to determine compliance with the NYSE standards and ExxonMobil’s additional standards. The Board has also evaluated whether there are any other facts or circumstances that might impair a director’s independence.Based on that review, the Board has determined that all ExxonMobilnon-employee directors and nominees are independent. The Board has also determined that each member of the Audit, Board Affairs, Compensation, and Public Issues and Contributions Committees (see membership table on page 10)15) is independent.independentbased on both applicable NYSE standards and the Company’s independence standards for each of these committees. The Company’s standards for each committee are included in their respective charters and are posted on our website at exxonmobil.com/guidelines. Website materials are not part of this proxy statement or the accompanying solicitation.
In recommending that each director and nominee be found independent, the Board Affairs Committee reviewed the following transactions, relationships, or arrangements. All matters described below fall within the NYSE and ExxonMobil independence standards.
Name | Matters Considered | |
U.M. Burns | Ordinary course business with | |
K.C. Frazier | ||
Ordinary course business with Merck (purchases of pharmaceuticals; sales of chemicals and oils) | ||
S.A. Kandarian | Ordinary course business with |
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Board Succession
As noted in the committee information that follows, the Board Affairs Committee is responsible for identifying director candidates. The Committee seeks new candidates in several ways:
Recommendations made by thenon-employee directors. These recommendations are developed based on the directors’ own knowledge and experience in a variety of fields and on the research conducted by ExxonMobil staff at the Committee’s direction.
Engagement of an executive search firm. The firm brings forward potential director candidates for the Committee to consider and helps research candidates identified by the Committee.
Recommendations made by employee directors, shareholders, and others.
All recommendations, regardless of the source, are evaluated on the same basis against the criteria contained in the Selection Guidelines. The Committee has also instructed its executive search firm to include diversity as part of the candidate search criteria.
Shareholders may send recommendations for director candidates to the Secretary at the address given under Contact Information on page 7. A submission recommending a candidate should include:
Sufficient biographical information to allow the Committee to evaluate the candidate in light of the Selection Guidelines;
Information concerning any relationship between the candidate and the shareholder recommending the candidate; and
Material indicating the willingness of the candidate to serve if nominated and elected.
The procedures by which shareholders may recommend nominees have not changed materially since last year’s proxy statement.
The Company seeks to have a diverse Board representing a range of backgrounds, knowledge, and skills relevant to the Company’s business and the needs of the Board, and as part of the search process, considers highly qualified candidates, including women and minorities. The Committee does not use quotas but considers diversity along with the other requirements of the Selection Guidelines when evaluating potential new directors.
Board Tenure
The Board does not impose tenure limits on its directors, other than a mandatory retirement age of 72 and the requirement to stand for election annually. Given the complexity and breadth of our business and its long investment horizons, the Board considers longevity of service and experience of great value. The Board also believes that its director compensation approach, which limits the vesting of restricted shares until retirement, closely aligns directors with the interests of long-term shareholders. The Board seeks to achieve a balance of diversity and experience in the composition of the Board.
All ExxonMobil directors stand for election at the annual meeting.Non-employee directors cannot stand for election after they have reached age 72, unless the Board makes an exception on acase-by-case basis. Employee directors resign from the Board when they are no longer employed by ExxonMobil.
As of April 1, 2019, the average tenure ofnon-employee directors standing for election is 6.5 years, well below the average of S&P 500 companies of 8.1 years (per2018 Spencer Stuart Board Index).
Non-Employee Director Tenure
22% | 45% | 11% | 22% | |||
< 3 years | 3-6 years | 7-10 years | 11+ years |
12 | ![]() | 2019 Proxy Statement |
Related Person Transactions and Procedures
In accordance with SEC rules, ExxonMobil maintains Guidelines for Review of Related Person Transactions (“Related Person Transaction Guidelines”). These guidelines are available on the Corporate Governance section of our website.
In accordance with the Related Person Transaction Guidelines, all executive officers, directors, and director nominees are required to identify, to the best of their knowledge after reasonable inquiry, business and financial affiliations involving themselves or their immediate family members that could reasonably be expected to give rise to a reportable related person transaction. Covered persons must also advise the Secretary of the Corporation promptly of any change in the information provided, and will be asked periodically to review and reaffirm their information.
For the above purposes, “immediate family member” includes a person’s spouse, parents, siblings, children,in-laws, and step-relatives.
Based on this information, the Company’s own records are reviewed andfollow-up inquiries are made as may be necessary to identify potentially reportable transactions. A report summarizing such transactions and including a reasonable level of detail is then provided to the Board Affairs Committee. The Committee oversees the Related Person Transaction Guidelines generally and reviews specific items to assess materiality.
In assessing materiality for this purpose, information will be considered material if, in light of all circumstances, there is a substantial likelihood that a reasonable investor would consider the information important in deciding whether to buy or sell ExxonMobil stock or in deciding how to vote shares of ExxonMobil stock. A director will abstain from the decision on any transactions involving that director or his or her immediate family members.
Under SEC rules, certain transactions are deemed not to involve a material interest (including transactions in which the amount involved in any12-month period is less than $120,000 and transactions with entities where a related person’s interest is limited to service as anon-employee director). In addition, based on a consideration of ExxonMobil’s facts and circumstances, the Committee will presume that the following transactions do not involve a material interest for purposes of reporting under SEC rules:
• | Transactions in the ordinary course of |
• | Grants or membership payments in the ordinary course of business to nonprofit organizations,provided: (1) the affected director or executive officer did not participate in the decision on the part of ExxonMobil to make such payments; and (2) the amount of general purpose grants in a12-month period is less than 1 percent of the recipient’s gross revenues; |
Payments under ExxonMobil plans and arrangements that are available generally to U.S. salaried employees (including contributions under the ExxonMobil Foundation’s Educational and Cultural Matching Gift Programs and payments to providers under ExxonMobil health care plans); and
• | Employment by ExxonMobil of a family member of an executive officer,provided the executive officer does not participate in decisions regarding the hiring, performance evaluation, or compensation of the family member. |
Transactions or relationships not covered by the above standards will be assessed by the Board Affairs Committee on the basis of the specific facts and circumstances.
Unless otherwise noted, the following disclosures are made as of February 26, 2019 which is the date of the most recent Board Affairs Committee review of potential related person transactions.
ExxonMobil and its affiliates have more than 70,000 employees around the world and employees related by birth or marriage may be found at all levels of the organization. ExxonMobil employees do not receive preferential treatment by reason of being related to an executive officer, and executive officers do not participate in hiring, performance
2019 Proxy Statement | ![]() | 13 |
evaluation, or compensation decisions for family members. ExxonMobil’s employment guidelines state, “Relatives of Company employees may be employed on anon-preferential basis. However, an employee should not be employed by or assigned to work under the direct supervision of a relative, or to report to a supervisor who in turn reports to a relative of the employee.”
Several current ExxonMobil executive officers and retirees who served as executive officers in 2018 have family members who are employed by the Corporation or its affiliates and whose current annualized compensation (including benefits) exceeds the SEC disclosure threshold: N.A. Hansen (Vice President – Investor Relations and Secretary) has abrother-in-law employed by ExxonMobil Development Company; L.M. Mallon (President – ExxonMobil Development Company) has a son employed by ExxonMobil Development Company; R.N. Schleckser (Vice President and Treasurer) has a brother employed by ExxonMobil Research and Engineering Company; J.M. Spellings, Jr. (Vice President and General Tax Counsel) has a son employed by ExxonMobil Pipeline Company; T.J. Wojnar, Jr. (Vice President – Corporate Strategic Planning) has ason-in-law employed by ExxonMobil Fuels & Lubricants Company; and J.J. Woodbury (retired former Vice President – Investor Relations and Secretary) has a son employed by XTO Energy Inc. Consistent with ExxonMobil’s Related Person Transaction Guidelines as described above, these relationships are not considered to be material within the meaning of the related person transaction disclosure rules.
S.N. Ortwein (retired former President, XTO Energy Inc) has abrother-in-law currently serving as Chief Executive Officer of Oracle Corporation. In the ordinary course of our business, ExxonMobil purchases a variety of computer technology and services from Oracle. Ms. Ortwein had no involvement in decisions regarding ExxonMobil’s business with Oracle and the annual volume of such business is well below the categorical threshold established in ExxonMobil’s Related Person Transaction Guidelines. R.M. Ebner (Vice President and General Counsel) has abrother-in-law who is a partner of a law firm that performs limited work for ExxonMobil. Mr. Ebner’sbrother-in-law does not work on ExxonMobil’s account and Mr. Ebner is recused from any involvement in decisions to retain the firm. Therefore, these relationships are not considered to be material within the meaning of the related person transaction disclosure rules.
The Board Affairs Committee also reviewed ExxonMobil’s ordinary course business with companies for whichnon-employee directors or their immediate family members serve as executive officers. The Committee determined that, in accordance with the categorical standards described above, none of those matters represent reportable related person transactions. See Director Independence on page 11.
The Committee also determined that no related person transactions occurred during the year involving any of the investors who have reported ownership of more than 5 percent of ExxonMobil’s outstanding common stock. See Certain Beneficial Owners on page 26.
ExxonMobil is not aware of any related person transactions required to be reported under applicable SEC rules since the beginning of the last fiscal year where our policies and procedures did not require review, or where such policies and procedures were not followed.
The Corporation’s Related Person Transaction Guidelines are intended to assist the Corporation in complying with its disclosure obligations under SEC rules. These procedures are in addition to, not in lieu of, the Corporation’s Code of Ethics and Business Conduct.
Code of Ethics and Business Conduct
The Board maintains policies and procedures (referred to in this proxy statement as the “Code”) that represent both the code of ethics for the principal executive officer, principal financial officer, and principal accounting officer under SEC rules, and the code of business conduct and ethics for directors, officers, and employees under NYSE listing standards. The Code applies to all directors, officers, and employees. The Code includes a Conflicts of Interest Policy under which directors, officers, and employees are expected to avoid any actual or apparent conflict between their own personal interests and the interests of the Corporation.
The Code is posted on the ExxonMobil website atexxonmobil.com/code. The Code is also included as an exhibit to ourAnnual Report on Form10-K. Any amendment of the Code will be posted promptly on ExxonMobil’s website.
14 | ![]() | 2019 Proxy Statement |
The Corporation maintains procedures for administering and reviewing potential issues under the Code, including procedures that allow employees to make complaints without identifying themselves. The Corporation also conducts periodic mandatory business practice training sessions, and requires regular employees andnon-employee directors to complete annual compliance certifications.
The Board Affairs Committee will initially review any suspected violation of the Code involving an executive officer or director and will report its findings to the Board. The Board does not envision that any waiver of the Code will be granted. Should such a waiver occur, it will be promptly disclosed on ExxonMobil’s website.
Board Meetings and Committees; Annual Meeting Attendance
The Board met 11nine times in 2015.2018. ExxonMobil’s incumbent directors, on average, attended approximately 9299 percent of Board and committee meetings during 2015.2018. No director attended less than 75 percent of such meetings. ExxonMobil’snon-employee directors held sixseven executive sessions in 2015.2018.
As specified in our Corporate Governance Guidelines, it is ExxonMobil’s policy that directors should make every effort to attend the annual meeting of shareholders. All incumbent directors attended last year’s meeting except Mr. Brabeck-Letmathe.meeting.
Board Committees
The Board appoints committees to help carry out its duties. Board committees work on key issues in greater detail than would be possible at full Board meetings. Onlynon-employee directors may serve on the Audit, Compensation, Board Affairs, and Public Issues and Contributions Committees. Each committee has a written charter. The charters are posted on the Corporate Governance section of our website atexxonmobil.com/governance.
The table below shows the current membership of each Board committee and the number of meetings each committee held in 2015.2018.
Director | Audit | Compensation | Board Affairs | Finance | Public Issues and Contributions | Executive(1) | Audit | Compensation | Board Affairs | Finance | Public Issues and Contributions | Executive(1) | ||||||||||||||||||||||||||||||||||||||||||||||||
M.J. Boskin | • | • | • | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
P. Brabeck-Letmathe | • | • | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
S.K. Avery |
✓ |
✓ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
A.F. Braly |
✓ |
C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.M. Burns | • | • |
C |
✓ |
✓ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
L.R. Faulkner | C | • | • | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
J.S. Fishman | • | • | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
H.H. Fore | • | • | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
K.C. Frazier | C | • |
✓ |
C |
✓ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
S.A. Kandarian |
✓ |
✓ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
D.R. Oberhelman | • | • |
✓ |
✓ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
S.J. Palmisano | C | • | • |
C |
✓ |
✓ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
S.S Reinemund | • | C | • |
✓ |
✓ |
✓ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
R.W. Tillerson | C | C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
W.C. Weldon | • | • |
✓ |
✓ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 Meetings | 11 | 7 | 7 | 2 | 5 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
D.W. Woods |
C |
C | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 Meetings |
11 |
6 |
6 |
2 |
4 |
0 |
C = Chair •✓ = Member (1) Other directors serve as alternate members on a rotational basis.basis
Below is additional information about each Board committee.
Board Affairs Committee
The Board Affairs Committee serves as ExxonMobil’s nominating and corporate governance committee. The Committee recommendsIts responsibilities include:
Recommendation of director candidates, reviews candidates;
Review ofnon-employee director compensation, and reviewscompensation;
Review of other corporate governance practices, including the Corporate Governance Guidelines. The Committee also reviewsGuidelines;
2019 Proxy Statement | ![]() | 15 |
Review of any issue involving an executive officer or director under ExxonMobil’s Code of Ethics and Business ConductConduct; and administers
Administration of ExxonMobil’s Related Person Transaction Guidelines.
The Committee has adopted Guidelines for the Selection of Non-Employee Directors that describe the qualifications the Committee looks for in director candidates. These Selection Guidelines, as well as the Committee’s charter, are posted on the Corporate Governance section of our website, and are described in more detail below and in the section titled Director Qualifications on pages 6 to 8.
A substantial majority of the Board must meet the independence standards described in the Corporate Governance Guidelines, and all candidates must be free from any relationship with management or the Corporation that would interfere with the exercise of independent judgment. Candidates should be committed to representing the interests of all shareholders and not any particular constituency. The Board must include members with the particular experience required for service on key Board committees, as described in the committee charters.
The Guidelines for the Selection of Non-Employee Directors state:
“ExxonMobil recognizes the strength and effectiveness of the Board reflect the balance, experience, and diversity of the individual directors; their commitment; and importantly, the ability of directors to work effectively as a group in carrying out their responsibilities. ExxonMobil seeks candidates with diverse backgrounds who possess knowledge and skills in areas of importance to the Corporation.”
In addition to seeking a diverse set of business or academic experiences, the Committee seeks a mix of nominees whose perspectives reflect diverse life experiences and backgrounds, as well as gender and ethnic diversity. The Committee does not use quotas but considers diversity along with the other requirements of the Selection Guidelines when evaluating potential new directors. The Committee has also instructed its executive search firm to include diversity as part of the candidate search criteria.
The Committee identifies director candidates primarily through recommendations made by the non-employee directors. These recommendations are developed based on the directors’ own knowledge and experience in a variety of fields, and research conducted by ExxonMobil staff at the Committee’s direction. The Committee has also engaged an executive search firm to help the Committee identify new director candidates. The firm identifies potential director candidates for the Committee to consider and helps research candidates identified by the Committee. Additionally, the Committee considers recommendations made by employee directors, shareholders, and others. All recommendations, regardless of the source, are evaluated on the same basis against the criteria contained in the Selection Guidelines.
The recommendation of Ms. Braly was made by incumbent directors and the executive search firm.
Shareholders may send recommendations for director candidates to the Secretary at the address given under Contact Information on page 4. A submission recommending a candidate should include:
The procedures by which shareholders may recommend nominees have not changed materially since last year’s proxy statement.
The Committee also administers provisions of the Corporate Governance Guidelines that require a director to tender a resignation when there is a substantial change in the director’s circumstances. The Committee reviews the relevant facts to determine whether the director’s continued service would be appropriate and makes a recommendation to the Board.
Another responsibility of the Committee is to review and make recommendations to the Board regarding the compensation of thenon-employee directors. The Committee uses an independent consultant, Pearl Meyer & Partners, LLC (“Pearl Meyer”), to provide information on current developments and practices in director compensation. Pearl Meyer & Partners is the same consultant retained by the Compensation Committee to advise on executive compensation, but performs no other work for ExxonMobil.
The Guidelines for the Selection ofNon-Employee Directors describe the qualifications the Committee looks for in director candidates. These Selection Guidelines, as well as the Committee’s charter, are posted on the Corporate Governance section of our website.
Audit CommitteeCode of Ethics and Business Conduct
The Audit Committee oversees accounting and internal control matters. Its responsibilities include oversight of:
The Committee has direct authority and responsibility to appoint (subject to shareholder ratification), compensate, retain, and oversee the independent auditors.
The Committee also prepares the report that SEC rules require be included in the Corporation’s annual proxy statement. This report is on pages 23 to 24.
The Audit Committee has adopted specificBoard maintains policies and procedures for pre-approving fees paid(referred to in this proxy statement as the independent auditors. Under“Code”) that represent both the Audit Committee’s approach, an annual programcode of work is approved each Octoberethics for the following categoriesprincipal executive officer, principal financial officer, and principal accounting officer under SEC rules, and the code of services: Audit, Audit-Related,business conduct and Tax. Additional engagements may be brought forward from timeethics for directors, officers, and employees under NYSE listing standards. The Code applies to time for pre-approval byall directors, officers, and employees. The Code includes a Conflicts of Interest Policy under which directors, officers, and employees are expected to avoid any actual or apparent conflict between their own personal interests and the Audit Committee. Pre-approvals apply to engagements within a category of service, and cannot be transferred between categories. If fees might otherwise exceed pre-approved amounts for any category of permissible services, the incremental amounts must be reviewed and pre-approved prior to commitment. The complete textinterests of the Audit Committee’s pre-approval policies and proceduresCorporation.
The Code is posted on the Corporate Governance sectionExxonMobil website atexxonmobil.com/code. The Code is also included as an exhibit to ourAnnual Report on Form10-K. Any amendment of the Code will be posted promptly on ExxonMobil’s website.
The Board has determined that all members of the Committee are financially literate within the meaning of the NYSE standards, and that Mr. Brabeck-Letmathe, Ms. Burns, Dr. Faulkner, and Mr. Oberhelman are “audit committee financial experts” as defined in the SEC rules.
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Compensation Committee
The Compensation Committee is comprised exclusively of non-employee directors and oversees compensation for ExxonMobil’s senior executives, including salary, bonus, and equity awards; and, succession planning for key executive positions. The Committee’s charter is available on the Corporate Governance section of our website.
During 2015, the Committee took the following actions:
The Committee does not delegate its responsibilities with respect to ExxonMobil’s executive officers and other senior executives (currently 27 positions). For other employees, the Committee delegates authority to determine individual salaries and incentive awards to a committee consisting of the Chairman, the President, and the Senior Vice Presidents of the Corporation. That committee’s actions are subject to a salary budget and aggregate annual ceilings on short-term and long-term incentive awards established by the Compensation Committee.
For more information on the compensation decisions made by the Committee for 2015, refer to the Compensation Discussion and Analysis (CD&A) beginning on page 28.
The Compensation Committee’s report is available on page 26.
The Compensation Committee utilizesCorporation maintains procedures for administering and reviewing potential issues under the expertise of an external independent consultant, Pearl Meyer & Partners. At the direction of the Committee, Pearl Meyer & Partners:
In addition, at the direction of the Chair of the Board Affairs Committee, Pearl Meyer & Partners provides an requires regular employees andnon-employee directors to complete annual survey of non-employee director compensation for use by that Committee.
The Compensation Committee is solely and directly responsible for the appointment, compensation, and oversight of the consultant. The Committee considers factors that could affect Pearl Meyer & Partners’ independence, including that the consultant provides no other services for ExxonMobil other than its engagement by the Committee and the Board Affairs Committee as described above. Based on this review, the Committee has determined the consultant’s work for the Committee to be free from conflicts of interest.
Finance Committee
The Finance Committee reviews ExxonMobil’s financial policies and strategies, including our capital structure, dividends, and share purchase program. The Committee authorizes the issuance of corporate debt subject to limits set by the Board. The Committee’s charter is available on the Corporate Governance section of our website.
Public Issues and Contributions Committee
The Public Issues and Contributions Committee reviews the effectiveness of the Corporation’s policies, programs, and practices with respect to safety, security, health, the environment, and social issues. The Committee hears reports from operating units on safety and environmental activities, and also visits operating sites to observe and comment on current operating practices. In addition, the Committee reviews the level of ExxonMobil’s support for education and other public service programs, including the Company’s contributions to the ExxonMobil Foundation. The Foundation works to improve the quality of education in the United States at all levels, with special emphasis on math and science. The Foundation also supports the Company’s other cultural and public service giving. The Committee’s charter is available on the Corporate Governance section of our website.
Executive Committee
The Executive Committee has broad power to act on behalf of the Board. In practice, the Committee meets only when it is impractical to call a meeting of the full Board.
Shareholder Engagement
We believe ongoing engagement with our shareholders is vitally important. ExxonMobil understands the importance of keeping shareholders informed about our business and issues of concern. The Company does so through a variety of means, including publications we issue throughout the year; our website (including thePerspectives blog); the annual shareholders meeting; webcasts including our annual executive compensation and governance webcast during which any shareholder can submit comments or questions; and through direct interface. We welcome and value input from all shareholders, and such input is taken seriously by the Company.compliance certifications.
The Board Affairs Committee has approvedwill initially review any suspected violation of the Code involving an executive officer or director and implemented procedures for shareholderswill report its findings to the Board. The Board does not envision that any waiver of the Code will be granted. Should such a waiver occur, it will be promptly disclosed on ExxonMobil’s website.
Board Meetings and other interested personsAnnual Meeting Attendance
The Board met nine times in 2018. ExxonMobil’s incumbent directors, on average, attended approximately 99 percent of Board and committee meetings during 2018. No director attended less than 75 percent of such meetings. ExxonMobil’snon-employee directors held seven executive sessions in 2018.
As specified in our Corporate Governance Guidelines, it is ExxonMobil’s policy that directors should make every effort to send written or electronic communicationsattend the annual meeting of shareholders. All incumbent directors attended last year’s meeting.
Board Committees
The Board appoints committees to individual directors, including the Presiding Director,help carry out its duties. Board committees orwork on key issues in greater detail than would be possible at full Board meetings. Onlynon-employee directors may serve on the non-employee directors asAudit, Compensation, Board Affairs, and Public Issues and Contributions Committees. Each committee has a group.
Additional instructions and procedures for communicating with the directorswritten charter. The charters are posted on the Corporate Governance section of our website atexxonmobil.com/proceduresdircomgovernance.
The table below shows the current membership of each Board committee and the number of meetings each committee held in 2018.
Director | Audit | Compensation | Board Affairs | Finance | Public Issues and Contributions | Executive(1) | ||||||||||||||||||||||||
S.K. Avery |
✓ |
✓ | ||||||||||||||||||||||||||||
A.F. Braly |
✓ |
C | ||||||||||||||||||||||||||||
U.M. Burns |
C |
✓ |
✓ | |||||||||||||||||||||||||||
K.C. Frazier |
✓ |
C |
✓ | |||||||||||||||||||||||||||
S.A. Kandarian |
✓ |
✓ | ||||||||||||||||||||||||||||
D.R. Oberhelman |
✓ |
✓ | ||||||||||||||||||||||||||||
S.J. Palmisano |
C |
✓ |
✓ | |||||||||||||||||||||||||||
S.S Reinemund |
✓ |
✓ |
✓ | |||||||||||||||||||||||||||
W.C. Weldon |
✓ |
✓ | ||||||||||||||||||||||||||||
D.W. Woods |
C |
C | ||||||||||||||||||||||||||||
2018 Meetings |
11 |
6 |
6 |
2 |
4 |
0 |
C = Chair ✓ = Member (1) Other directors serve as alternate members on a rotational basis
Below is additional information about each Board committee.
Board Affairs Committee
The Board Affairs Committee serves as ExxonMobil’s nominating and corporate governance committee. Its responsibilities include:
Recommendation of director candidates;
Review ofnon-employee director compensation;
Review of other corporate governance practices, including the Corporate Governance Guidelines;
2019 Proxy Statement | ![]() | 15 |
Review of any issue involving an executive officer or director under ExxonMobil’s Code of Ethics and Business Conduct; and
Administration of ExxonMobil’s Related Person Transaction Guidelines.
The Committee also administers provisions of the Corporate Governance Guidelines that require a director to tender a resignation when there is a substantial change in the director’s circumstances. The Committee reviews the relevant facts to determine whether the director’s continued service would be appropriate and makes a recommendation to the Board.
Another responsibility of the Committee is to review and make recommendations to the Board regarding the compensation of thenon-employee directors. The Committee uses an independent consultant, Pearl Meyer & Partners, LLC (“Pearl Meyer”), to provide information on current developments and practices in director compensation. Pearl Meyer is the same consultant retained by the Compensation Committee to advise on executive compensation, but performs no other work for ExxonMobil.
The Guidelines for the Selection ofNon-Employee Directors describe the qualifications the Committee looks for in director candidates. These Selection Guidelines, as well as the Committee’s charter, are posted on the Corporate Governance section of our website.
Code of Ethics and Business Conduct
The Board maintains policies and procedures (which we refer(referred to in this proxy statement as the “Code”) that represent both the code of ethics for the principal executive officer, principal financial officer, and principal accounting officer under SEC rules, and the code of business conduct and ethics for directors, officers, and employees under NYSE listing standards. The Code applies to all directors, officers, and employees. The Code includes a Conflicts of Interest Policy under which directors, officers, and employees are expected to avoid any actual or apparent conflict between their own personal interests and the interests of the Corporation.
The Code is posted on the ExxonMobil website atexxonmobil.com/code. The Code is also included as an exhibit to ourAnnual Report on Form 10-K.10-K. Any amendment of the Code will be posted promptly on ourExxonMobil’s website.
14 | ![]() | 2019 Proxy Statement |
The Corporation maintains procedures for administering and reviewing potential issues under the Code, including procedures that allow employees to make complaints without identifying themselves. The Corporation also conducts periodic mandatory business practice training sessions, and requires regular employees andnon-employee directors to makecomplete annual compliance certifications.
The Board Affairs Committee will initially review any suspected violation of the Code involving an executive officer or director and will report its findings to the Board. The Board does not envision that any waiver of the Code will be granted. Should such a waiver occur, it will be promptly disclosed on ExxonMobil’s website.
Board Meetings and Annual Meeting Attendance
The Board met nine times in 2018. ExxonMobil’s incumbent directors, on average, attended approximately 99 percent of Board and committee meetings during 2018. No director attended less than 75 percent of such meetings. ExxonMobil’snon-employee directors held seven executive sessions in 2018.
As specified in our Corporate Governance Guidelines, it is ExxonMobil’s policy that directors should make every effort to attend the annual meeting of shareholders. All incumbent directors attended last year’s meeting.
Board Committees
The Board appoints committees to help carry out its duties. Board committees work on key issues in greater detail than would be possible at full Board meetings. Onlynon-employee directors may serve on the Audit, Compensation, Board Affairs, and Public Issues and Contributions Committees. Each committee has a written charter. The charters are posted on the Corporate Governance section of our website atexxonmobil.com/governance.
The table below shows the current membership of each Board committee and the number of meetings each committee held in 2018.
Director | Audit | Compensation | Board Affairs | Finance | Public Issues and Contributions | Executive(1) | ||||||||||||||||||||||||
S.K. Avery |
✓ |
✓ | ||||||||||||||||||||||||||||
A.F. Braly |
✓ |
C | ||||||||||||||||||||||||||||
U.M. Burns |
C |
✓ |
✓ | |||||||||||||||||||||||||||
K.C. Frazier |
✓ |
C |
✓ | |||||||||||||||||||||||||||
S.A. Kandarian |
✓ |
✓ | ||||||||||||||||||||||||||||
D.R. Oberhelman |
✓ |
✓ | ||||||||||||||||||||||||||||
S.J. Palmisano |
C |
✓ |
✓ | |||||||||||||||||||||||||||
S.S Reinemund |
✓ |
✓ |
✓ | |||||||||||||||||||||||||||
W.C. Weldon |
✓ |
✓ | ||||||||||||||||||||||||||||
D.W. Woods |
C |
C | ||||||||||||||||||||||||||||
2018 Meetings |
11 |
6 |
6 |
2 |
4 |
0 |
C = Chair ✓ = Member (1) Other directors serve as alternate members on a rotational basis
Below is additional information about each Board committee.
Board Affairs Committee
The Board Affairs Committee serves as ExxonMobil’s nominating and corporate governance committee. Its responsibilities include:
Recommendation of director candidates;
Review ofnon-employee director compensation;
Review of other corporate governance practices, including the Corporate Governance Guidelines;
2019 Proxy Statement | ![]() | 15 |
Review of any issue involving an executive officer or director under ExxonMobil’s Code of Ethics and Business Conduct; and
Administration of ExxonMobil’s Related Person Transaction Guidelines.
The Committee also administers provisions of the Corporate Governance Guidelines that require a director to tender a resignation when there is a substantial change in the director’s circumstances. The Committee reviews the relevant facts to determine whether the director’s continued service would be appropriate and makes a recommendation to the Board.
Another responsibility of the Committee is to review and make recommendations to the Board regarding the compensation of thenon-employee directors. The Committee uses an independent consultant, Pearl Meyer & Partners, LLC (“Pearl Meyer”), to provide information on current developments and practices in director compensation. Pearl Meyer is the same consultant retained by the Compensation Committee to advise on executive compensation, but performs no other work for ExxonMobil.
The Guidelines for the Selection ofNon-Employee Directors describe the qualifications the Committee looks for in director candidates. These Selection Guidelines, as well as the Committee’s charter, are posted on the Corporate Governance section of our website.
Related Person TransactionsAudit Committee
The Audit Committee oversees accounting and Proceduresinternal control matters. Its responsibilities include oversight of:
In accordance
Management’s conduct of the Corporation’s financial reporting process;
The integrity of the financial statements and other financial information provided by the Corporation to the SEC and the public;
The Corporation’s system of internal accounting and financial controls;
The Corporation’s compliance with legal and regulatory requirements;
The performance of the Corporation’s internal audit function;
The independent auditors’ qualifications, performance, and independence; and
The annual independent audit of the Corporation’s financial statements.
The Committee has direct authority and responsibility to appoint (subject to shareholder ratification), compensate, retain, and oversee the independent auditors.
The Committee also prepares the report that SEC rules ExxonMobil maintains Guidelinesrequire be included in the Corporation’s annual proxy statement. This report is on pages 27 and 28.
The Audit Committee has adopted specific policies and procedures for Reviewpre-approving fees paid to the independent auditors. Under the Audit Committee’s approach, an annual program of Related Person Transactions. These Guidelineswork is approved each October for the following categories of services: Audit, Audit-Related, and Tax. Additional engagements may be brought forward from time to time forpre-approval by the Audit Committee.Pre-approvals apply to engagements within a category of service, and cannot be transferred between categories. If fees might otherwise exceedpre-approved amounts for any category of permissible services, the incremental amounts must be reviewed andpre-approved prior to commitment. The complete text of the Audit Committee’spre-approval policies and procedures, as well as the Committee’s charter, is posted on the Corporate Governance section of ExxonMobil’s website.
The Board has determined that all members of the Committee are financially literate within the meaning of the NYSE standards, and that Ms. Burns, Mr. Oberhelman, and Mr. Weldon are “audit committee financial experts” as defined in the SEC rules.
16 | ![]() | 2019 Proxy Statement |
Compensation Committee
The Compensation Committee is comprised exclusively ofnon-employee, independent directors, and oversees compensation for ExxonMobil’s senior executives (including salary, bonus, and performance share awards), as well as succession planning for key executive positions. The Committee’s charter is available on the Corporate Governance section of our website.
In accordanceDuring 2018, the Committee took the following actions:
Reviewed and approved the corporate goals and objectives relevant to the compensation of the CEO;
Reviewed the Corporation’s business results and progress on strategic plans during the year with ExxonMobil’s CEO and other senior executives;
Carefully considered the Related Person Transaction Guidelines, allresults of the 2018 advisory vote on executive compensation;
Assessed each element of the Company’s compensation program and practices, and confirmed that they do not create any material adverse risks for the Company. The key design features of the compensation program that discourage executives from taking inappropriate risk are described in detail in this proxy statement (see pages 32, and 45 to 48);
Discussed the Company’s executive compensation program with its independent consultant;
Established the aggregate annual ceilings for the 2018 short-term and long-term incentive award programs taking into account input received from the CEO and other senior executives;
Approved the salary program for 2019;
Reviewed the performance and contributions of, and granted incentive awards and salary for, the CEO. The CEO does not participate in or provide input to decisions regarding his own compensation;
Reviewed the individual performance and contributions of, and granted individual incentive awards and set salaries for, other senior executives based on recommendations to the Committee by the CEO; and
Reviewed progress on executive development and succession planning for senior-level positions with input from the CEO.
The Committee does not delegate its responsibilities with respect to ExxonMobil’s executive officers directors, and director nomineesother senior executives (currently 21 positions). For other employees, the Committee delegates authority to determine individual salaries and incentive awards to a committee consisting of the Chairman and the Senior Vice Presidents of the Corporation. That committee’s actions are requiredsubject to identify,a salary budget and aggregate annual ceilings on short-term and long-term incentive awards established by the Compensation Committee.
For more information on the compensation decisions made by the Committee for 2018, refer to the bestCompensation Discussion and Analysis (“CD&A”) beginning on page 31.
The Compensation Committee’s report is available on page 30.
The Compensation Committee utilizes the expertise of their knowledge after reasonable inquiry, business and financial affiliations involving themselves or their immediate family members that could reasonably be expected to give rise to a reportable related person transaction. Covered persons must also advisean external independent consultant, Pearl Meyer. At the Secretarydirection of the Corporation promptlyCommittee, Pearl Meyer:
Attends Committee meetings;
Informs the Committee regarding general trends in executive compensation across industries;
Prepares the analysis of any changecomparator company compensation used by the Committee; and
Participates in the information provided, and will be asked periodically to review and reaffirm their information.Committee’s deliberations regarding compensation for Named Executive Officers.
ForIn addition, at the above purposes, “immediate family member” includes a person’s spouse, parents, siblings, children, in-laws, and step-relatives.
Based on this information, we reviewdirection of the Company’s own records and make follow-up inquiries as may be necessary to identify potentially reportable transactions. A report summarizing such transactions and including a reasonable levelChair of detail is then provided to the Board Affairs Committee. The Committee, oversees the Related Person Transaction Guidelines generally and reviews specific items to assess materiality.
In assessing materialityPearl Meyer provides an annual survey ofnon-employee director compensation for this purpose, information will be considered material if, in light of all circumstances, there is a substantial likelihood a reasonable investor would consider the information important in deciding whether to buy or sell ExxonMobil stock or in deciding how to vote shares of ExxonMobil stock. A director will abstain from the decision on any transactions involvinguse by that director or his or her immediate family members.
Under SEC rules, certain transactions are deemed not to involve a material interest (including transactions in which the amount involved in any 12-month period is less than $120,000 and transactions with entities where a related person’s interest is limited to service as a non-employee director). In addition, based on a consideration of ExxonMobil’s facts and circumstances, the Committee will presume that the following transactions do not involve a material interest for purposes of reporting under SEC rules:Committee.
2019 Proxy Statement | ![]() | 17 |
The Compensation Committee is solely and directly responsible for the appointment, compensation, and oversight of the consultant. The Committee considers factors that could affect Pearl Meyer’s independence, including that the consultant provides no other services for ExxonMobil other than its engagement by the Committee and the Board Affairs Committee as described above. Based on this review, the Committee has determined the consultant’s work for the Committee to be free from conflicts of interest.
Finance Committee
The Finance Committee reviews ExxonMobil’s financial policies and strategies, including our capital structure, dividends, and share purchase program. The Committee authorizes the issuance of corporate debt subject to limits set by the Board. The Committee’s charter is available on the Corporate Governance section of our website.
Public Issues and Contributions Committee
The Public Issues and Contributions Committee reviews the effectiveness of the Corporation’s policies, programs, and practices with respect to safety, security, health, the environment, including climate-related matters, and social issues. The Committee hears reports from operating units on safety and environmental activities, and also visits operating sites to observe and comment on current operating practices. In addition, the Committee reviews the level of ExxonMobil’s support for education and other public service programs, including the Company’s contributions to the ExxonMobil Foundation. The Foundation works to improve the quality of education in the United States at all levels, with special emphasis on math and science. The Foundation also supports the Company’s other cultural and public service giving. The Committee’s charter is available on the Corporate Governance section of our website.
Executive Committee
The Executive Committee has broad power to act on behalf of the Board. In practice, the Committee meets only when it is impractical to call a meeting of the full Board.
Shareholder Engagement We believe ongoing engagement with our shareholders is vitally important. ExxonMobil understands the The Company communicates with shareholders through a variety of means, including publications we issue throughout the year; our website (including thePerspectives blog); the annual shareholders meeting; webcasts, including our annual executive compensation and governance webcast during which any shareholder can submit comments or questions; and through direct interface. We welcome and value input from all shareholders, and such input is taken seriously by the Company. The Board Affairs Committee has approved and implemented procedures for •Written Communications:Written correspondence should be addressed to the |
•Electronic Communications:You may sende-mail to individualnon-employee directors, Board committees, or thenon-employee directors as a group by using the form provided for that purpose on our website atexxonmobil.com/directors. |
18 |
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Transactions or relationships not covered by the above standards will be assessed by the Committee on the basis of the specific facts and circumstances.
The following disclosures are made as of February 24, 2016, the date of the most recent Board Affairs Committee review of potential related person transactions.
ExxonMobil and its affiliates have about 73,500 regular employees around the world and employees related by birth or marriage may be found at all levels of the organization. ExxonMobil employees do not receive preferential treatment by reason of being related to an executive officer, and executive officers do not participate in hiring, performance evaluation, or compensation decisions for family members. ExxonMobil’s employment guidelines state, “Relatives of Company employees may be employed on a non-preferential basis. However, an employee should not be employed by or assigned to work under the direct supervision of a relative, or to report to a supervisor who in turn reports to a relative of the employee.”
Several current ExxonMobil executive officers have family members also employed by the Corporation or its affiliates: M.W. Albers (Senior Vice President) has a daughter employed by ExxonMobil Global Services Company; R.N. Schleckser (Vice President and Treasurer) has a brother employed by ExxonMobil Refining & Supply Company; S.M. Greenlee (Vice President) has a son employed by ExxonMobil Development Company; and J.J. Woodbury (Vice President – Investor Relations and Secretary) has a son employed by XTO Energy Inc. In each case, the total value of the family member’s current annualized compensation (including benefits) exceeds the SEC threshold for disclosure. However, consistent with ExxonMobil’s Related Person Transaction Guidelines, we do not consider any of the relationships noted above to be material within the meaning of the related person transaction disclosure rules.
The Board Affairs Committee also reviewed ExxonMobil’s ordinary course business with companies for which non- employee directors or their immediate family members serve as executive officers. The Committee determined that, in accordance with the categorical standards described above, none of those matters represent reportable related person transactions. See Director Independence on page 9.
The Committee also determined that no related person transactions occurred during the year involving any of the investors who have reported ownership of 5 percent or more of ExxonMobil’s outstanding common stock. See “Certain Beneficial Owners” on page 22.
We are not aware of any related person transactions required to be reported under applicable SEC rules since the beginning of the last fiscal year where our policies and procedures did not require review, or where such policies and procedures were not followed.
The Corporation’s Related Person Transaction Guidelines are intended to assist the Corporation in complying with its disclosure obligations under SEC rules. These procedures are in addition to, not in lieu of, the Corporation’s Code of Ethics and Business Conduct.
ITEMItem 1 – ELECTION OF DIRECTORSElection of Directors
The Board of Directors has nominated the director candidates named on the following pages. Personal information onabout each of our nominees, including public company directorships during the past five years, is provided. Also included are the particular qualifications and competencies of each director nominee that led the Board to conclude that such person should serve as a director of the Company.All of our nominees currently serve as ExxonMobil directors, except for Ms. Braly, who has been nominated by the Board for first election as a director at the annual meeting.directors.
All director nominees have stated they are willing to serve if elected. If a nominee becomes unavailable before the election, your proxy authorizes the people named as proxies to vote for a replacement nominee if the Board names one. Alternatively, the Board may reduce its size to equal the number of remaining nominees.
The Board recommends you vote FOR each of the following candidates:
Susan K. Avery
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Principal occupation: President Emerita, Woods Hole Oceanographic Institution Age Director since Independent director Committees: Board Affairs, Public Issues and Contributions |
•Academic leadership at the University of Colorado Boulder as interim dean of the graduate school and vice chancellor for research, interim provost, and executive vice chancellor for academic affairs from 2004 to 2008 •Government / scientific research experience as past member of the United Nations Scientific Advisory Board and the National Research Council Global Change Research Program Advisory Committee •Scientific and research advisory committee memberships held or recently held at NASA, NOAA, National Science Foundation, Lawrence Berkeley National Laboratory, National Park System, Independent Advisory Committee on Applied Climate Risk, Center for Southern Hemisphere Ocean Research, Qingdao National Laboratory for Marine Science and Technology, and Japan Agency for Marine-Earth Science and Technology •Scientific and environmental affiliations: University Corporation for Atmospheric Research (Chair of Board), Consortium for Ocean Leadership (senior fellow), American Geophysical Union, American Meteorological Society (fellow), American Association for the Advancement of Science (fellow), and Institute of Electrical and Electronics Engineers (fellow) Current public company directorships: None Previous public company directorships in last five years: None |
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Angela F. Braly | ||
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Principal occupation: Former Chairman of the Board, President, and Chief Executive Officer, WellPoint (now Anthem) Age Director since Independent director Committees: Compensation, Public Issues and Contributions |
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•
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•Business and public policy affiliations: The Policy Circle(Co-Founder, Director, and Secretary), Indiana Economic Development Corporation (former Director), Business Council (former member), Business Roundtable (former member), Harvard Advisory Council on Health Care Policy, and Blue Cross Blue Shield Association (former Director) Current
Other board experience: former Director of WellPoint, | |
Inc. (prior to 2014) |
Ursula M. Burns
| ||
Principal occupation: Chairman of the Board and Chief Executive Officer, VEON Ltd. Age Director since 2012 Independent director Committees: Audit, Executive, Finance |
Background: •Global business leadershipwith operational experienceat Xerox as Chairman
•Government and public policy experience as Vice Chair and Chair of the President’s Export Council (2010 to 2016) •Scientific, academic, andnon-profit affiliations: Ford Foundation (Trustee), National Academy Foundation, Mayo Clinic (counsel/advisor), MIT Corporation (Trustee), National Academy of Engineers (member), American Academy of Arts and Sciences (member), Cornell Technology Board of Overseers (counsel/advisor), New York City Ballet Inc. (Director) Current Previous public company directorships in last five years: American Express (January
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Kenneth C. Frazier
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Principal occupation: Chairman of the Board, President, and Chief Executive Officer, Merck & Co., Inc. Age Director since Independent director Committees: Board Affairs, Compensation, Executive |
•Global business leadership with operational experience at Merck & Co., Inc. as Chairman and Chief Executive Officer
| |
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•Legal and business affiliations: American Law Institute, Business Council, and American Bar Association •Scientific and research affiliations:Pharmaceutical Research and Manufacturers of America, Weill Cornell Medicine, and American Academy of Arts and Sciences Current
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Steven A. Kandarian | ||
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Principal occupation: Chairman of the Board, President, and Chief Executive Officer, MetLife Age Director since Independent director Committees: Compensation, Public Issues and Contributions |
Background: •Global business leadership with operational experience at MetLife, Inc. as Chairman since 2012; as President and Chief Executive Office since 2011; and as Executive Vice President and Chief Investment Officer from 2005 to 2011. He also served as Executive Director of the Pension Benefit Guaranty Corporation from 2001 to 2004. •Business and cultural affiliations: Business Roundtable, Business Council, Partnership for New York City (Director), Institute of International Finance (former Director and Chair, Insurance Regulatory Committee), and the Lincoln Center for the Performing Arts (former Director) •Scientific and research affiliations:Damon Runyon Cancer Research Foundation (Director) Current public company directorships: MetLife (May 2011 to Present); AECOM (March 2019 to Present) Previous public company directorships in last five years: None |
2019 Proxy Statement | ![]() | 21 |
Douglas R. Oberhelman | ||
Principal occupation: Former Chairman of the Board and Chief Executive Officer, Caterpillar Inc.
Director since 2015 Independent director Committees: Audit, Finance | Background: •Global business leadership with operational and commodity business experience at Caterpillar Inc. as Chairman
•Business and charitable affiliations: Business Roundtable (former Chairman), National Association of Manufacturers (former Chairman), Easter Seals Foundation of Central Illinois (Chairman), Gilmore Foundation (Vice President and Director), and Intersect Illinois (Director) •Environmental conservation:Wetlands America Trust (Vice President), Max McGraw Wildlife Foundation (Director) Current
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Other board experience: Director of Peter Kiewit Sons’, Inc. (August 2017 to Present); Chairman and Director of Switch Rail Safety Systems, LLC (June 2018 to Present); former Director of Ameren Corporation (prior to 2014) |
Samuel J. Palmisano
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Principal occupation: Former Chairman of the Board, President, and Chief Executive Officer, IBM Age Director since 2006 Independent director Committees: Board Affairs, Compensation, Executive |
•Global business leadership with operational experience at IBM as Chairman, President, and Chief Executive Officer
•Business and public policy affiliations: The Center for Global Enterprise (Chairman), Business Roundtable, Executive Committee of the Council on Competitiveness, and Commission on Enhancing National Cybersecurity (former Vice Chair) Current
Other board experience: former Director of Gannett Co. and IBM |
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Steven S Reinemund
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Principal occupation: Former Chairman of the Board and Chief Executive Officer, PepsiCo Age Director since Presiding director since 2016 Independent director Committees: Board Affairs, Public Issues and Contributions, Executive | Background: •Global business leadership with operational experience at PepsiCo as Executive Chairman of the Board from 2006 to 2007; as Chairman and Chief Executive Officer from 2001 to 2006; and as President and Chief Operating Officer from 1999 to 2001. He also served as President and CEO ofFrito-Lay and Pizza Hut. •Academic leadership at Wake Forest University as Dean of Business from 2008 to 2014; and as Professor of Leadership and Strategy •Business affiliations: U.S. Naval Academy Foundation (Board of Trustees), Newman’s Own Foundation (Advisory Board), and Center for Creative Leadership (Board of Governors) •Scientific, research, and academic affiliations:The Cooper Institute (Board of Directors), and Wake Forest University (Board of Trustees) Current public company directorships: GS Acquisition Holdings Corp. (June 2018 to Present); Marriott International, Inc. (April 2007 to Present); Walmart Inc. (June 2010 to Present) Previous public company directorships in last five years: American Express (April 2007 to May 2015) Other board experience: former Director of Johnson & Johnson and PepsiCo (both prior to 2014) |
William C. Weldon | ||
Principal Former Chairman of the Board and Chief Executive Officer, Johnson & Johnson
Director since 2013 Independent director Committees: Audit, Finance | Background: •Global business leadership with operational experience at Johnson & Johnson as Chairman and Chief Executive Officer
•Business affiliations:Business Council (former Vice Chairman), Business Roundtable, and Healthcare Leadership Council •Scientific, research and academic affiliations:Pharmaceutical Research and Manufacturers of America (former Chairman), Quinnipiac University Board of Trustees (Chairman), and CEO Roundtable on Cancer (former Chairman) Current
Other board experience: former Director of Johnson & Johnson |
2019 Proxy Statement | ![]() | 23 |
Darren W. Woods | ||||
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| Principal Chairman of the Board and Chief Executive Officer, Exxon Mobil Corporation
Director Committees: Finance, Executive | Background: •Global business leadership at Exxon Mobil Corporation •Operational and commodity businessexperience with positions of increasing responsibility in •Business affiliations: Business Roundtable, American Petroleum Institute (Chair), Business Council, Center for Strategic and •Scientific and environmental experience:ExxonMobil Chemical Company and ExxonMobil Refining & Supply
Current
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DIRECTOR COMPENSATIONDirector Compensation
Director compensation elements are designed to:
Ensure alignment with long-term shareholder interests;
Ensure the Company can attract and retain outstanding director candidates who meet the selection criteria outlined in the Guidelines for Selection ofNon-Employee Directors, which can be found on the Corporate Governance section of our website;
Recognize the substantial time commitmentscommitment necessary to oversee the affairs of the Corporation; and
Support the independence of thought and action expected of directors.
Non-employee director compensation levels are reviewed by the Board Affairs Committee each year, and resulting recommendations are presented to the full Board for approval. The Committee uses an independent consultant, Pearl Meyer, & Partners, to provide information on current developments and practices in director compensation. Pearl Meyer & Partners is the same consultant retained by the Compensation Committee to advise on executive compensation, but performs no other work for ExxonMobil.
ExxonMobil employees receive no additional pay for serving as directors.
Non-employee directors receive compensation consisting of cash and equity in the form of restricted stock. Non- employeeNon-employee directors are also reimbursed for reasonable expenses incurred to attend Board meetings or other functions relating to their responsibilities as a director of Exxon Mobil Corporation.
The annual cash retainer fornon-employee directors in 20152018 was $110,000 per year. Chairs of the Audit and Compensation Committees and the Presiding Director receive an additional $10,000 per year.
A significant portion of director compensation is granted in the form of restricted stock to align director interests with the interests of our long-term shareholders. The annual restricted stock award grant for incumbentnon-employee directors is 2,500 shares. A newnon-employee director receives aone-time grant of 8,000 shares of restricted stock upon first being elected to the Board.
24 | ![]() | 2019 Proxy Statement |
While on the Board, thenon-employee director receives the same cash dividends on restricted shares as a holder of regular common stock, but the shares remain unvested and, thus, cannot be sold.sold or pledged. The restricted shares are subject to forfeiture if thenon-employee director leaves the Board early, i.e., before the retirement age of 72, as specified fornon-employee directors.
Current and formernon-employee directors of Exxon Mobil Corporation are eligible to participate in the ExxonMobil Foundation’s Educational and Cultural Matching Gift Programs under the same terms as the Corporation’s U.S. employees.
Director Compensation for 20152018
Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(a) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Change in
Deferred ($) | Other Compensation
| Total ($) |
Fees ($)
|
Stock
|
Option ($)
|
Non-Equity ($)
|
Change in and Nonqualified Deferred Compensation Earnings ($)
|
Other ($)(b)
|
Total ($)
| ||||||||||||||||||||||||||||||||||
M.J. Boskin | 110,000 | 231,075 | 0 | 0 | 0 | 340 | 341,415 | |||||||||||||||||||||||||||||||||||||||||
P. Brabeck-Letmathe | 110,000 | 231,075 | 0 | 0 | 0 | 340 | 341,415 | |||||||||||||||||||||||||||||||||||||||||
S.K. Avery |
| 110,000 |
|
| 211,075 |
| 0 | 0 | 0 | 286 |
| 321,361 |
| |||||||||||||||||||||||||||||||||||
M.J. Boskin(c) |
| 45,632 |
|
| 211,075 |
| 0 | 0 | 0 | 119 |
| 256,826 |
| |||||||||||||||||||||||||||||||||||
A.F. Braly |
| 110,000 |
|
| 211,075 |
| 0 | 0 | 0 | 286 |
| 321,361 |
| |||||||||||||||||||||||||||||||||||
U.M. Burns | 110,000 | 231,075 | 0 | 0 | 0 | 340 | 341,415 |
| 120,000 |
|
| 211,075 |
| 0 | 0 | 0 | 286 |
| 331,361 |
| ||||||||||||||||||||||||||||
L.R. Faulkner | 120,000 | 231,075 | 0 | 0 | 0 | 340 | 351,415 | |||||||||||||||||||||||||||||||||||||||||
J.S. Fishman | 120,000 | 231,075 | 0 | 0 | 0 | 340 | 351,415 | |||||||||||||||||||||||||||||||||||||||||
H.H. Fore | 110,000 | 231,075 | 0 | 0 | 0 | 340 | 341,415 | |||||||||||||||||||||||||||||||||||||||||
K.C. Frazier | 110,000 | 231,075 | 0 | 0 | 0 | 340 | 341,415 |
| 110,000 |
|
| 211,075 |
| 0 | 0 | 0 | 286 |
| 321,361 |
| ||||||||||||||||||||||||||||
W.W. George (ret.) | 44,726 | 231,075 | 0 | 0 | 0 | 142 | 275,943 | |||||||||||||||||||||||||||||||||||||||||
S.A. Kandarian |
| 100,528 |
|
| 706,400 |
| 0 | 0 | 0 | 239 |
| 807,167 |
| |||||||||||||||||||||||||||||||||||
D.R. Oberhelman | 65,274 | 682,640 | 0 | 0 | 0 | 193 | 748,107 |
| 110,000 |
|
| 211,075 |
| 0 | 0 | 0 | 286 |
| 321,361 |
| ||||||||||||||||||||||||||||
S.J. Palmisano | 120,000 | 231,075 | 0 | 0 | 0 | 340 | 351,415 |
| 120,000 |
|
| 211,075 |
| 0 | 0 | 0 | 286 |
| 331,361 |
| ||||||||||||||||||||||||||||
S.S Reinemund | 110,000 | 231,075 | 0 | 0 | 0 | 340 | 341,415 |
| 120,000 |
|
| 211,075 |
| 0 | 0 | 0 | 286 |
| 331,361 |
| ||||||||||||||||||||||||||||
W.C. Weldon | 110,000 | 231,075 | 0 | 0 | 0 | 340 | 341,415 |
| 110,000 |
|
| 211,075 |
| 0 | 0 | 0 | 286 |
| 321,361 |
|
(a) | In accordance with SEC rules, the valuation of stock awards in this table represents fair value on the date of grant. Dividends on stock awards are not shown in the table because those amounts are factored into the grant date fair value. |
Each director (other than Mr. Oberhelman,Kandarian, who joined the Board in May 2015)February 2018) received an annual grant of 2,500 restricted shares in January 2015.2018. The valuation of these awards is based on a market price of $92.43$84.43 on the date of grant.
Mr. OberhelmanKandarian received aone-time grant of 8,000 restricted shares upon first being elected to the Board in May 2015.February 2018. The valuation of this award is based on the market price of $85.33$88.30 on the date of the grant.
Atyear-end 2015, 2018, the aggregate number of restricted shares held by each director was as follows:
Name | Restricted Shares | |||||
| ||||||
| ||||||
S.K. Avery | 10,500 | |||||
A.F. Braly | 13,000 | |||||
U.M. Burns | 23,000 | |||||
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K.C. Frazier | 30,500 | |||||
S.A. Kandarian | 8,000 | |||||
D.R. Oberhelman | 15,500 | |||||
S.J. Palmisano | 39,500 | |||||
S.S Reinemund | 35,500 | |||||
W.C. Weldon | 20,500 |
(b) | The amount shown for each director is the cost of travel accident insurance covering death, dismemberment, or loss of sight, speech, or hearing under a policy purchased by the Corporation with a maximum benefit of $500,000 per individual. |
(c) | Retired effective May 30, 2018. |
2019 Proxy Statement | ![]() | 25 |
Thenon-employee directors are not entitled to any additional payments or benefits as a result of leaving the Board or death except as described above. Thenon-employee directors are not entitled to any payments or benefits resulting from a change in control of the Corporation.
CERTAIN BENEFICIAL OWNERSCertain Beneficial Owners
Based on our review of ownership reports filed with the SEC, the firms listed below are the only beneficial owners of more than 5 percent of ExxonMobil’s outstanding common stock as of December 31, 2015.2018.
Name and Address of Beneficial Owner | Shares Owned | Percent of Class | Shares Owned | Percent of Class | ||||||||||||||
The Vanguard Group 100 Vanguard Blvd. Malvern, PA 19355 | 261,953,264 | 6.3 | % |
|
340,023,050 |
|
8.0% | |||||||||||
BlackRock Inc. 55 East 52nd Street New York, NY 10055 | 242,628,716 | 5.8 | % | |||||||||||||||
BlackRock, Inc. 55 East 52nd Street New York, NY 10055
|
|
285,575,768 |
|
6.7% |
DIRECTOR AND EXECUTIVE OFFICER STOCK OWNERSHIPDirector and Executive Officer Stock Ownership
These tables show the number of ExxonMobil common shares each executive named in the Summary Compensation Table on page 4749 and eachnon-employee director or director nominee owned on February 29, 2016.28, 2019. In these tables, ownership means the right to direct the voting or the sale of shares, even if those rights are shared with someone else. None of these individuals owns more than 0.050.02 percent of the outstanding shares.
Named Executive Officer | Shares Owned(1) | Shares Covered by Exercisable Options | Shares Owned(1) | Shares Covered by Exercisable Options | ||||||||||
R.W. Tillerson | 1,809,121 | 0 | ||||||||||||
M.W. Albers | 443,023 | 0 | ||||||||||||
M.J. Dolan | 555,611 | (2) | 0 | |||||||||||
D.W. Woods |
| 80,291 |
| 0 | ||||||||||
N.A. Chapman |
| 95,588 | (2) | 0 | ||||||||||
N.W. Duffin | 270,548 | (3) | 0 | |||||||||||
A.P. Swiger | 502,093 | 0 |
| 497,951 |
| 0 | ||||||||
D.W. Woods | 82,247 | 0 | ||||||||||||
J.P. Williams, Jr. |
| 82,193 |
| 0 |
(1) | Does not include unvested restricted stock units, which do not carry voting rights prior to the issuance of shares on settlement of the awards. |
(2) | Includes |
(3) | Co-trustee andco-beneficiary with spouse in family trust for 113,058 shares. |
| Shares Owned | |||||||
| 13,000 | |||||||
A.F. Braly | 17,575(1) | |||||||
U.M. Burns | 25,706 | |||||||
| ||||||||
| ||||||||
| ||||||||
K.C. Frazier | 33,000 | |||||||
S.A. Kandarian | 10,500 | |||||||
D.R. Oberhelman | 18,000 | |||||||
S.J. Palmisano | 42,000 | |||||||
S.S Reinemund | 48,125 | |||||||
W.C. Weldon | 24,209 |
(1) | Includes |
26 | ![]() | 2019 Proxy Statement |
On February 29, 2016,28, 2019, ExxonMobil’s incumbent directors and executive officers (32(27 people) together owned 5,960,2812,204,887 shares of ExxonMobil stock and zero shares covered by exercisable options, representing about 0.140.05 percent of the outstanding shares.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities and Exchange Act of 1934 requires our executive officers and directors to file reports of their ownership and changes in ownership of ExxonMobil stock on Forms 3, 4, and 5 with the SEC. We are not aware of any unfiled or late reports for 2015.2018.
AUDIT COMMITTEE REPORTAudit Committee Report
The primary function of our Audit Committee is oversight of the Corporation’s financial reporting process, public financial reports, internal accounting and financial controls, and the independent audit of the annual consolidated financial statements. Our Committee acts under a charter, which can be found on the ExxonMobil website atexxonmobil.com/auditcharterauditcommitteecharter.. We review the adequacy of the charter at least annually. All of our members are independent directors, and all are audit committee financial experts under SEC rules.directors. We held 11 meetings in 20152018 at which, as discussed in more detail below, we had extensive reports and discussions with the independent auditors, internal auditors, and members of management.
In performing our oversight function, we reviewed and discussed the consolidated financial statements with management and PricewaterhouseCoopers LLP (PwC)(“PwC”), the independent auditors. Management and PwC indicated that the Corporation’s consolidated financial statements were fairly stated in accordance with generally accepted accounting principles. We discussed significant accounting policies applied by the Corporation in its financial statements, as well as alternative treatments. We discussed with PwC matters covered by Public Company Accounting Oversight Board (PCAOB)(“PCAOB”) standards, including PCAOB AS 161301Communication with Audit Committees. In addition, we reviewed and discussed management’s report on internal control over financial reporting and the related audits performed by PwC, which confirmed the effectiveness of the Corporation’s internal control over financial reporting.
We also discussed with PwC its independence from the Corporation and management, including the communications PwC is required to provide us under applicable PCAOB rules. We considered thenon-audit services provided by PwC to the Corporation, and concluded that the auditors’ independence has been maintained.
We discussed with the Corporation’s internal auditors and PwC the overall scope and plans for their respective audits. We met with the internal auditors and PwC at each meeting, both with and without management present. Discussions included the results of their examinations, their evaluations of the Corporation’s internal controls, and the overall quality of the Corporation’s financial reporting.
We discussed with the Corporation’s management the comprehensive, long-standing risk management and compliance processes of the Corporation, and reviewed several topics of interest.
Based on the reviews and discussions referred to above, in reliance on management and PwC, and subject to the limitations of our role described below, we recommended to the Board, and the Board approved, the inclusion of the audited financial statements in the Corporation’sAnnual Report on Form10-K for the year ended December 31, 2015,2018, for filing with the SEC.
We have also appointed PwC to audit the Corporation’s financial statements for 2016, subject to shareholder ratification of that appointment.
In carrying out our responsibilities, we look to management and the independent auditors. Management is responsible for the preparation and fair presentation of the Corporation’s financial statements and for maintaining effective internal control. Management is also responsible for assessing and maintaining the effectiveness of internal control over the financial reporting process in compliance with Sarbanes-Oxley Section 404 requirements. The independent auditors are responsible for auditing the Corporation’s annual financial statements, and expressing an opinion as to whether the statements are fairly stated in conformity with generally accepted accounting principles. In addition, the independent auditors are responsible for auditing the Corporation’s internal control over financial reporting and for expressing an opinion on the effectiveness of internal control over financial reporting. The
2019 Proxy Statement | ![]() | 27 |
independent auditors perform their responsibilities in accordance with the standards of the PCAOB. Our members are not professionally engaged in the practice of accounting or auditing, and are not experts under the Securities Act of 1933 in either of those fields or in auditor independence.
We have also appointed PwC to audit the Corporation’s financial statements for 2019, subject to shareholder ratification of that appointment. The Committee annually evaluates, along with the other members of the Board, management, the Controller, and the General Auditor, PwC’s qualifications, performance, and independence, including the performance of the lead audit partner, in deciding whether or not to retain PwC. That evaluation includes consideration of:
PwC’s quality control, including any material issues identified by that quality control or a governmental/professional authority along with PwC’s plan to deal with any such issues;
All relationships between PwC and ExxonMobil covered by the PCAOB;
PwC’s expertise in the global oil and gas industry; and
The quality of PwC’s audit plans.
The Committee believes that PwC’s tenure as ExxonMobil’s independent registered public accounting firm is a benefit to audit quality given PwC’s experience with ExxonMobil and knowledge of the business, as well as the effectiveness of their audit plans, which build on that established knowledge.
Based on the Committee’s annual evaluation of PwC’s qualifications, performance, and independence, as well as frequent private meetings with the lead partner, we believe that the continued retention of PwC as ExxonMobil’s independent registered public accounting firm is in the best interest of the Corporation and its stockholders.
| ||
Ursula M. Burns, Chair | Douglas R. Oberhelman | |
William C. Weldon |
ITEMItem 2 – RATIFICATION OF INDEPENDENT AUDITORSRatification of Independent Auditors
The Audit Committee has appointed PricewaterhouseCoopers LLP (PwC)(“PwC”) to audit ExxonMobil’s financial statements for 2016.2019. We are asking you to ratify that appointment.
Total Fees
The total fees for PwC professional services rendered to ExxonMobil for the year ended December 31, 2015,2018, were $34.4$41.2 million, an increasea decrease of $1.2$3.9 million from 2014.2017. The Audit Committee reviewed andpre-approved all services in accordance with the servicepre-approval policies and procedures, which can be found on the ExxonMobil website atexxonmobil.com/pre-approvalpre-approval.. The Audit Committee did not use the “de minimis” exception topre-approval that is available under SEC rules. The following table summarizes the fees, which are described in more detail below.
2015 | 2014 | |||||||
(millions of dollars) | ||||||||
Audit Fees | 27.9 | 27.3 | ||||||
Audit-Related Fees | 5.7 | 5.1 | ||||||
Tax Fees | 0.8 | 0.8 | ||||||
All Other Fees | — | — | ||||||
|
|
|
| |||||
Total | 34.4 | 33.2 |
2018 | 2017 | |||||||||
(millions of dollars) | ||||||||||
Audit Fees |
| 31.4 |
| 32.2 | ||||||
Audit-Related Fees |
| 8.8 |
| 11.4 | ||||||
Tax Fees |
| 1.0 |
| 1.5 | ||||||
All Other Fees |
| — |
| — | ||||||
Total |
| 41.2 |
| 45.1 |
Audit Fees
The aggregate fees for PwC professional services rendered for the annual audits of ExxonMobil’s financial statements for the year ended December 31, 2015,2018, and for the reviews of the financial statements included in our quarterly reports on Form10-Q for that year were $27.9$31.4 million (versus $27.3$32.2 million for 2014).2017), with the decrease primarily due to lower acquisition-related work and foreign exchange impacts.
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Audit-Related Fees
The aggregate fees for PwC Audit-Related services rendered to ExxonMobil for the year ended December 31, 2015,2018, were $5.7$8.8 million (versus $5.1$11.4 million in 2014). Thesefor 2017), with the decrease primarily due to lower regulatory support work. Audit-related services were mainly related to asset dispositions, benefit plan audits and other attestation procedures related to cost certifications.procedures.
Tax Fees
The aggregate fees for PwC Tax services rendered to ExxonMobil for the year ended December 31, 2015,2018, were $0.8$1.0 million (versus $0.8$1.5 million for 2014).2017), with the decrease primarily due to lower acquisition-related work. These services arewere mainly related to assisting various ExxonMobil affiliates with the preparation of local tax filings and related services.
All Other Fees
The aggregate fees for PwC services rendered to ExxonMobil, other than the services described above under “Audit Fees,” “Audit-Related Fees,” and “Tax Fees,” for the year ended December 31, 2015,2018, were zero (also zero in 2014)for 2017).
We believe PwC is well qualified to perform this work. A PwC representative will be at the annual meeting to answer appropriate questions and to make a statement if desired.
The Audit Committee recommends you vote FOR this proposal.
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COMPENSATION COMMITTEE REPORTCompensation Committee Report
The Compensation Committee of the Board of Directors has reviewed and discussed the Compensation Discussion and Analysis with management of the Corporation. Based on that review and discussion, we recommended to the Board that the Compensation Discussion and Analysis be included in the Corporation’s proxy statement for the 20162019 annual meeting of shareholders, and also incorporated by reference in the Corporation’sAnnual Report on Form10-K for the year ended December 31, 2015.2018.
Samuel J. Palmisano, Chair | ||
Kenneth C. Frazier |
ITEMItem 3 – ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATIONAdvisory Vote to Approve Executive Compensation
At the meeting, shareholders will be asked to vote on anon-binding resolution to approve the compensation of the Named Executive Officers (NEOs), listed in the Summary Compensation Table.
ExxonMobil’s business model is reflective of a capital-intensive industry requiring long investment lead times and a significant focus on risk management. The structureWhen casting your vote, we encourage you to consider the content of our Executive Compensation Overview and detailed information included in the Compensation Discussion and Analysis beginning on page 31.
The Board continues to support the overall design of the compensation program, fully supports this business model and aligns the interests of our executives with those of our long-term shareholders. This is particularly relevant given the current state of the industry.
ExxonMobil conducts business in a volatile commodity price environment and positions itself to achieve industry-leading returns regardless of industry conditions. We continue to create value for our shareholders by confidently and prudently investing through the price cycle to meet long-term energy demand growth. Our integrated business enables us to optimize economic returns across the oil and gas value chain. The Corporation’s success requires a strong culture of performance, a long-term orientation, and constancy of purpose among senior executives, all of which are reinforced by the design of our compensation program.
Our compensation program is developed and approved by the Compensation Committee of the Board, which is comprised exclusivelycharacterized by three key features:
Ties executive compensation to the returns of non-employee directors.
Aligned with Shareholder Interests
A substantial portionlong-term shareholders – The majority of annual compensation is delivered in the form ofrestricted stock or stock units with a grant level determined by performance shares, linking the performance award matrix described on page 33. Halfultimate value of the equity award vests in five years from grant date and the other half vests in 10 years from grant date or retirement, whichever is later. These stock holding requirements are not accelerated upon retirement. During these long restriction periods, which far exceed most companies across all industries, the equity award cannot be used as collateral for any purpose and is at risk of forfeiture for resignation or detrimental activity, even beyond retirement.
This design ensures that the majority of compensation and the shareholding net worth of senior executives are linkedpay to the performance of ExxonMobil stock and resulting shareholder returns. The executives’ inabilitystock.
Recognizes the long-term nature of ExxonMobil’s business model – Performance shares are subject to monetize equity earlier ensures that they experience the impact oflongest restriction periods in the industry, including through the commodity price cycles much like ourcycle. A significant portion of executive pay vests only after retirement. Therefore, executives are encouraged to take a long-term shareholders, as describedview in more detail on page 36.their business decision making.
The
annual bonusLinks executives’ compensation to Company performance also aligns the interests– The number of executives with the priority of sustainable growth in shareholder value. The size of the bonus poolshares at grant is determined by annual earningsrelative Company performance versus industry peers, progress toward strategic objectives including strengthening the Company’s growth strategy, and market orientation of total compensation. We set the level of individual awards is determined by thehighest performance award matrix described on page 33. Fifty percent of the payout of the annual bonus award is delayed based on the pace of Corporate earnings performance, as described on pages 34 and 39. The entire annual bonus is subject to recoupment (“clawback”).
Linked to Business Results
The performance award matrix described on page 33 illustrates thatstandards, requiring industry-leading performanceresults over the investment lead times of the business is requiredinpre-established metrics.
For 2018, Company performance remains industry leading in the following seven key areas to achieve a topall but one of these performance category (quintile) bonus and long-term stock award: Safety and Operations Integrity, Return on Average Capital Employed,metrics, Total Shareholder Return Free Cash Flow, Shareholder Distributions, Strategic Business Results, and Project Execution. Moreover, all 21 executive officers – including(TSR). Compensation levels for the CEO and other Named Executive Officers – are expectedNEOs reflect these results.
We continue to perform atlisten and respond to the highest level or they are replaced.
A combination of these seven key performance metrics reflects the overall relative performance of the Corporation, as demonstrated on pages 30 and 31. Furthermore, a requirement to demonstrate leadershipfeedback we receive from shareholders during our shareholder engagement process. As in all seven key performance areas establishes a significant performance standard at grant (versus vest) that allows the Corporation to maintain its uniquely long vesting periods. The more traditional alternative with performance criteria at vest requires greater line of sight resultingprevious years, we enhanced disclosures in shorter vesting periods, which would not be aligned with ExxonMobil’s business model.
Supported by Sound Governance Practices
The compensation program excludes pay practices that the Compensation Committee believes are contraryresponse to shareholder interests and do not encourage the highest performance standards. Specifically, our executives are“at-will” employees and do not have employment contracts, severance agreements, or change-in-control arrangements, as detailed on page 43.feedback.
Shareholder Engagement
The Compensation Committee has carefully considered shareholder feedback on executive compensation received through wide-ranging dialogue between management and numerous shareholders, many of whom have held ExxonMobil stock for over a decade. The Committee also evaluated the results of the 2015 advisory vote on executive compensation, in which 90.1 percent of votes cast were FOR the compensation of the Named Executive Officers, and discussed the Company’s executive compensation program with its independent consultant.
On this basis, and in combination with a periodic assessment of alternate methods of granting compensation as outlined on pages 36 and 37, the Compensation Committee confirmed that the current compensation program best ensures an unwavering focus on the long-term performance of the business, which the Committee expects will continue generating strong operating and financial results for the benefit of the Company’s long-term shareholders.
The Committee respects all shareholder votes, both FOR and AGAINST the compensation program, and is committed to continued engagement between shareholders and the Company to fully understand the diverse viewpoints and discuss the important connections between ExxonMobil’s compensation program, business strategy, and long-term financial and operating performance.
Summary
For the reasons summarized above and discussed in more detail in this proxy statement, the Board recommends an advisory vote FOR the following resolution:
RESOLVED: That shareholders approve the compensation of the Named Executive Officers as disclosed pursuant to Item 402 of SEC RegulationS-K, including the Compensation Discussion and Analysis, compensation tables, and narrative discussion on pages 2831 to 5657 of this proxy statement.
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COMPENSATION DISCUSSION AND ANALYSIS
The Compensation Discussion and Analysis (CD&A) and Executive Compensation Tables are organized as follows:
LETTER TO SHAREHOLDERS Fellow Shareholders, Before you cast your vote on Management Resolution Item 3 - Advisory Vote to Approve Executive Compensation, the members of the Board's independent Compensation Committee encourage you to review the content of this Executive Compensation Overview, as well as the additional detail provided in the Compensation Discussion and Analysis, compensation tables, and narrative in ExxonMobil's 2019 Proxy Statement. The Compensation Committee reviews the effectiveness and competitiveness of the executive compensation program on an annual basis. ExxonMobil's business involves large investments over long periods of time that require executives to maintain a long-term view when making business decisions. The Company's executive compensation program is designed to reflect this. The Compensation Committee continues to support the design of the executive compensation program. It allows the Committee to leverage the experience and judgment of its members, across a mix of critical performance factors, to grant pay to executives that is both performance-based and aligned with the returns of our long-term shareholders. We encourage you to vote "FOR" Item 3. Samuel J. Palmisano Chair, ExxonMobil Compensation Committee
WHAT WE DO | WHAT WE DON’T DO | |||||
Executive stock ownership policy Significant CEO pay at risk Strong forfeiture provisions Anti-hedging policy Bonus clawback policy Annual assessment of compensation design | No employment contracts No severance agreements Nochange-in-control arrangements No guaranteed bonuses No additional stock grants to balance losses in value No accelerated vesting at retirement | |||||
Independent compensation consultant |
2018 CEO STOCK OWNERSHIP | ||||||||
It is ExxonMobil’s policy that executives maintain significant stock ownership. Restriction periods on performance shares that are three times longer than those at compensation benchmark companies result in stock ownership levels that far exceed standard ownership guidelines. | ||||||||
Standard Guideline | ExxonMobil CEO | |||||||
6x | VS. | 32x | 90 PERCENT OF CEO STOCK OWNERSHIP CONSISTS OF UNVESTED SHARES | |||||
Base Salary | Base Salary |
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EXECUTIVE SUMMARY – WHY VOTE “FOR”SAY-ON-PAY?
EXECUTIVE PAY IS ALIGNED WITHCOMPANY PERFORMANCE
Significant progress toward strategic goals led to an increase in number of performance shares granted to CEO, balanced against relative TSR performance that did not lead the average of industry peers Maintained industry-leading performance across all other pre-established metrics 2018 bonus program increased as a result of higher 2018 earnings Pay for CEO position is at 44th percentile of CEO compensation benchmarks(1) |
PROGRAM TIES EXECUTIVE PAY TOSHAREHOLDER RETURNS
Over 60 percent of CEO pay is in performance shares, with longest restriction periods in any industry Long-term incentive program results in executives holding much higher percentage of performance shares through full business and commodity price cycles Compensation program design makes long-term investors of our executives Executives incentivized to maximize long-term shareholder returns and value while effectively managing risks, including environmental risks |
ENHANCED DISCLOSURE IN RESPONSE TOSHAREHOLDER FEEDBACK
Provided further clarification on the Illustrated how performance share program aligns with business model Strengthened disclosure of Company performance metrics that determine Clarified operation of |
HIGHLIGHT:SHAREHOLDER ENGAGEMENT Continued broad engagement on compensation strategy with shareholders and proxy advisors in 2018 ∎ Shareholder engagements with holders of close to half of outstanding institutionally held shares ∎ Independent director engagement with shareholders on compensation design ∎ Shareholder webinar to gather input from all shareholders |
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To fully understand the rationale for the design of ExxonMobil’s executive compensation program, it is important to understand the industry in which we operate. The decisions and risks that our dialogueexecutives face play out over time horizons that are often decades in length. Therefore, the intent of the compensation program is to incentivize long-term decision making and align executives’ pay with shareholders:
The Company’s strategies provide the framework for the organization to deliver on its commitments, create shareholder value throughout the commodity price cycle, and address the dual challenge of meeting the growing demand for energy while reducing environmental impacts. For more information, see theSummary Annual Report.(2)
ELEMENT | FEATURES | |||
Performance Shares | ∎ Targetingover 50 percent of total reported pay | |||
∎ Performance metrics applied at grant, | ||||
∎ Aligns level of executive compensation with returns of long-term shareholders | ||||
∎ Encourages long-term view through commodity price cycle | ||||
∎ Places significant portion of executive pay at risk of forfeiture | ||||
Annual Bonus | ∎ Targeting10 to 20 percent of total reported pay | |||
∎ Links compensation to annual business performance | ||||
∎ Actual award determined by individual performance and pay | ||||
∎ 50 percent of award paid in cash at grant; 50 percent subject to delayed vesting |
∎ Delayed feature provides medium-term performance | ||||
Base Salary | ∎ Targeting10 percent or less of total reported pay | |||
∎ Provides a base level of | ||||
∎ Ties directly to long-term benefits |
Key MessagesPERFORMANCESHARE PROGRAM
DESIGN PRINCIPLES
Why Vote “For” Say-On-Pay?
Industry-leading performance across companies within the oil and gas industry of similar scale and complexity formed the basis for compensation decisions made by the Compensation Committee in 2015
(1) Employees and contractors; includes XTO Energy Inc. data beginning in 2011. (2) Workforce safety data from participating American Petroleum Institute (API) companies; 2015 industry data not available at time of publication. (3) Competitor data estimated on a consistent basis with ExxonMobil and based on public information. For definitions and more information, see page 44 of theSummaryAnnual Report included with the 2016 Proxy Statement. (4) Cumulative (chart 3) and Annualized (chart 4) returns assuming dividends are reinvested when paid. (5) Chevron, Royal Dutch Shell, Total, and BP weighted by market capitalization; shareholder return data for Total available from 1992. (6) Annual data calculated as average of daily prices from U.S. Energy Information Administration (EIA).
For the following footnotes, competitor data estimated on a consistent basis with ExxonMobil and based on public information.
(7) BP excludes impact of GOM spill, TNK-BP divestment, and 2013 Rosneft investment. For definitions and more information, see page 45 of the Summary Annual Report included with the 2016 Proxy Statement. (8) Total shareholder distributions divided by market capitalization. Shareholder distributions consist of cash dividends and share buybacks. For more information, see page 45 of theSummary Annual Report included with the 2016 Proxy Statement. (9) More information on Strategic Business Results is included on page 45. (10) Total Capitalization defined as “Net Debt + Market Capitalization”; and Leverage defined as “Net Debt / Total Capitalization.”
Design Objectives
Compensation program that rewards outstanding performance, promotes retention, and encourages long-term business decisions
Performance Differentiation
Career Orientation
Applying performance metrics at grant enables restriction periods of 10 years and longer | Restriction periods and | Significant portion of executive pay vests only after retirement |
Succession Planning and Continuity of Leadership
Compensation Committee Decisions
Benchmarking
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KEY DESIGN FEATURES
WHY APPLY PERFORMANCE METRICS AT GRANT?
∎ | ExxonMobil’s Compensation Committee considers performance against key metrics in its decision-making process on CEO compensation |
∎ | Industry-leading performance in allpre-established metrics is required for ExxonMobil executives to achieve a maximum performance share award level |
∎ | Applying performance metrics at grant, versus at vest, enables restriction periods on performance shares of 5 years, 10 years, and longer, keeping executives focused on the long-term performance of the Company |
∎ | Long restriction periods also ensure that a significant portion of pay reflects the outcome of long-term business decisions and the experience of long-term shareholders |
WHY NOT TARGET SETTING?
∎ | The Committee considered an alternate program based on a target-setting method that would have determined the number of shares at vest |
∎ | This alternate method requires use of a shorter time horizon to set meaningful, credible targets. This method would encourage short-term thinking, misaligned with long investment lead times and the capital-intensive nature of the business |
∎ ExxonMobil’s longer restriction periods ensure that executives are required to hold shares through the commodity price cycle ∎ An alternate, formula-based program with short-term target setting and three-year ∎ In this example, shares are granted to an executive each year over the10-year period from 2008 to 2017 – In 2013, on the eve of agreater-than-50-percent decline in crude price, only 8 percent of awards granted in the ExxonMobil program had vested – In the alternate program with three-year vesting, 58 percent of awards granted would have vested – 7 times more than the ExxonMobil program ∎ Through long restriction periods, ExxonMobil executives are incentivized to take a long-term view in decision making | VESTED SHARES AVAILABLE TO SELL IMMEDIATELY PRIOR TO 2013 CRUDE OIL PRICE COLLAPSE(4) |
2019 Proxy Statement | ![]() |
DETERMINING THE NUMBER OF PERFORMANCE SHARES GRANTED TO CEO IN 2018
When deciding on the annual share grant for the CEO, the Compensation Committee relies on: Company performance results relative to industry peers based onpre-established performance metrics; the Company’s progress toward its strategic objectives; and the results of annual compensation benchmarking, including the impact of experience in the position.
| ||||||
INPUTS TO COMPENSATION COMMITTEE | ||||||
CONSIDERATIONS (see pages 37 to 39 for additional detail) | ||||
FINANCIAL AND OPERATING | PROGRESS TOWARD STRATEGIC OBJECTIVES | ANNUAL COMPENSATION BENCHMARKING | ||
Leading ∎ Safety and Operations Integrity ∎ Return on Average Capital Employed ∎ Cash Flow from Operations and Asset Sales Not Leading ∎ Total Shareholder Return | Strengthened Company growth strategy Significant 2018 accomplishments in advancing strategic objectives | 10-year combined realized and unrealized pay for the CEO position is at the44th percentileof compensation benchmark company CEOs | ||
2018 DECISION | ||
150,000 Performance Shares granted to CEO | Compensation Committee increased number of shares versus 2017 due to significant progress toward strategic objectives, continued industry leadership in 3 of 4 financial and operating performance metrics, and results of annual benchmarking given experience in position | |
COMPENSATION COMMITTEEDOES NOT ADJUST SHARE GRANTS
IN RESPONSE TO CHANGES IN SHARE PRICE
36 | ![]() | 2019 Proxy Statement |
PROGRESS TOWARD STRATEGIC OBJECTIVES: 2018 KEY HIGHLIGHTS(2)
COMPENSATION COMMITTEE NOTEDSIGNIFICANT PROGRESS
IN 2018 IN ADVANCING STRATEGIC OBJECTIVES
STRENGTHENING THE UPSTREAM PORTFOLIO
| |||||
19 captures totaling over 17 million gross acres, including new country entries in Pakistan, Namibia, and Suriname Accelerated pace of development in the Permian, capturing benefits across the full value chain from integration with world-class U.S. Gulf Coast manufacturing | |||||
UPGRADING DOWNSTREAM PRODUCTION
|
Continued implementation of shift to high-value products (diesel, jet, and lubes) with upgrades at Antwerp,
Rotterdam, and Beaumont facilities
Highest Performance Standards
LEADING IN CHEMICAL GROWTH |
Continued growth withstart-up of the Singapore butyl and adhesion units and the Baytown ethane cracker Construction continues on additional growth projects on the U.S. Gulf Coast Memorandum of Understanding signed for flexible-feed liquids cracker to be constructed in Guangdong Province, China |
REDUCING ENVIRONMENTAL IMPACTS |
Progressedlow-emissions technologies, including advanced biofuels, carbon capture and storage, and higher-efficiency processing Increased support for sound policies aimed at mitigating the risks of climate change: joined the Oil & Gas Climate Initiative; continued participation in for Carbon Dividends, a 501(c)(4) Progressed program to reduce methane emissions |
INVESTING WITH DISCIPLINE |
Financial strength maximized ability to continue growing significant portfolio of advantaged and high-return projects Continued strong leadership regarding returns on capital employed Increased dividend payments for 36th consecutive year |
Scale and Complexity
![]() |
Programs applied consistently for the past 14 years to all executives worldwide, including the CEO
Bonus Program
FINANCIAL AND OPERATINGPERFORMANCE
ThreeCOMPENSATION COMMITTEE UTILIZESPERFORMANCE METRICS THAT ENCOURAGE DECISION MAKING THAT PROMOTES LONG-TERM SHAREHOLDER VALUE CREATION
In order for executives to maximize performance factors determineshare award levels, industry-leading performance relative to industry peers is required across allpre-established metrics. This creates a very high, ongoing standard of performance for our executives.
Financial and operating performance is assessed relative to industry peers, which operate similar integrated businesses that share commodity price cycles and with whom we compete for resources and opportunities. These companies, within the annual bonusoil and focus executives on sustainable growthgas industry, are also similar to ExxonMobil in shareholder value:scale and complexity, and therefore are better comparators when assessing relative performance.
Continued industry leadership in 3 of 4 financial and operating performance metrics. Lagging TSR performance continued in 2018. Compensation levels reflect these results.
RETURN ON AVERAGE CAPITAL EMPLOYED (ROCE)(7)
SAFETY AND OPERATIONS INTEGRITY
Leading: Continue industry leadership in safety performance |
∎ | Safety performance is an indicator for business performance and underscores safety as a core value |
∎ | Compensation Committee considers operations integrity, including environmental performance |
ROCE10-YEAR ROLLING AVERAGE(7)
∎ | Leading:10-year ROCE performance very strong in relation to competitors |
∎ | Shareholder value created through efficient use of capital |
38 | ![]() | 2019 Proxy Statement |
CASH FLOW FROM OPERATIONS AND ASSET SALES(7)
∎ | Leading: Long-term cash flow from operations and asset sales outpacing competitors |
∎ | Superior cash flow provides capacity for investments and growing shareholder distributions |
TOTAL SHAREHOLDER RETURN (TSR)(9)
∎ | Not leading average of industry peers in10-year TSR |
∎ | TSR metric demonstrates the return that an investor realizes over a given investment holding period, including share price changes and dividends |
ANNUAL BENCHMARKING / SCALE AND COMPLEXITY
COMPENSATION COMMITTEE CONDUCTSANNUAL BENCHMARKING TO ASSESS MARKET COMPETITIVENESS OF EXECUTIVE COMPENSATION AND PROGRAM DESIGN FEATURES
∎ | Compensation Committee considers scale and complexity as relevant factors in assessing the appropriateness of pay levels |
∎ | All three of ExxonMobil’s major business segments, on a stand-alone basis, rank among other large companies based on revenue |
∎ | Annual benchmarking performed against peer group consisting of large, U.S.-based companies with international operations. Ideal comparators for ExxonMobil include companies with large scale and complexity, capital-intensive businesses with long investment horizons, and those that can be consistent participants in compensation surveys |
SCALE OF EXXONMOBIL VS. BENCHMARK COMPANIES(10)(11)
2019 Proxy Statement | ![]() | 39 |
DESIGN PRINCIPLES
∎ | Links compensation to annual earnings performance |
∎ | Encourages strong earnings performance in the near- andmid-term while maintaining risk of forfeiture |
KEY FEATURES
∎ | Size of |
% change in bonus program = (% change in annual earnings) x (2/3)
Individual grant levels determined by |
Bonus delivered using two vehicles: |
ANNUAL BONUS AWARD TO CEO POSITION AND EXXONMOBIL EARNINGS
2015 bonus represents 9 percent of CEO’s reported pay and is down 35 percent versus 2014, in line with change in earnings in 2015
Equity Program
Three design principles in combination result in performance and risk profiles aligned with the returns of long-term shareholders:
Vesting periods for senior executives far exceed typical three-year vesting that is common across most industries
Example – Stock Award Grant vs. Vest Period for CEO, assuming retirement in 2017
Performance criteria at grant allow ExxonMobil to have long vesting periods while maintaining a significant award performance basis
2015 stock award represents 67 percent of CEO’s reported pay; number of shares granted is consistent with 2014, reflective of ExxonMobil’s industry-leading performance in all 7 key areas over investment lead times of the business
CEO Compensation
For definitions of the terms “Reported Pay,” “Realized Pay,” and “Unrealized Pay” as used in this Overview, as well as a list of our compensation benchmark companies, see Frequently Used Terms on page 38. (1) Interest rate changes: from 2.5% for 2012 to 3.5% for 2013; to 3.0% for 2014; to 2.75% for 2015. (2) In 2013, the change in pension value was negative (–$6.24 million), but under SEC reporting rules, a negative change in pension value must be shown in the Summary Compensation Table as zero. (3) Exercised last stock options granted in 2001 that would have expired in 2011. No stock options granted since 2001. (4) 2015 benchmark company data not available at time of publication.
50% Cash Paid in year of grant |
Long Vesting Periods
ExxonMobil’s vesting periods far exceed competitors, are strongly integrated with our business model, and are aligned with long-term shareholder interests
Resulting in extensive stock holding through the commodity cycle
Vesting delayed until cumulative earnings per share
(EPS) reaches $6.50 per share
Reflective of long investment lead times and well aligned with ExxonMobil’s business model
For both examples, and in both programs, 100 shares are granted each year from 2006 to 2016.
(1) ExxonMobil equity program: 50 percent of an annual grant of restricted stock or restricted stock units vests in 5 years and the other 50 percent vests in 10 years or retirement, whichever is later. (2) Hypothetical alternate formula-based program: percent of target shares that pay out depending on ExxonMobil’s relative three-year TSR rank versus our primary competitors: Chevron, Royal Dutch Shell, Total, and BP. TSR ranking has been determined by a Monte Carlo simulation that applies equal probability to each rank position. The Monte Carlo simulation method is consistent with U.S. GAAP accounting principles for valuing performance stock awards. Payout factors as follows: 200% of target if ranked 1; 150% of target if ranked 2; 75% of target if ranked 3; and 0% of target if ranked 4 or 5. (3) Annual data calculated as average of daily prices from U.S. Energy Information Administration (EIA).
Periodic Assessment of Program Design
The Compensation Committee periodically evaluates alternate long-term equity programs, including a methodology based on three-year relative TSR
Delayed EBU vesting feature adds secondary performance metric (EPS) and retains risk of forfeiture on |
2018 PROGRAM
∎ | In 2018, the |
The bonus program formula has been consistently applied in |
2018 EXXONMOBIL CEO REPORTED PAY VS. REALIZED PAY
∎ | Over 60 percent of CEO pay delivered in the form of performance shares with restriction periods of 5 years, 10 years, and longer |
A requirement to demonstrate leadership in all 7 key performance areas establishes a significant performance standard at grant which in turn allows ExxonMobil to maintain its uniquely long vesting periodsCOMBINED REALIZED AND UNREALIZED PAY
Sound Governance Practices
How our program encourages the highest performance standards:
How our program discourages inappropriate risk taking:
Our program is applied consistently to all executives, including the CEO
Shareholder Engagement and Prior Say-On-Pay Vote
40 |
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Frequently Used TermsFREQUENTLY USED TERMS
Please also read the footnotes contained throughout this Overviewon page 42 for additional definitions of terms we use and other important information.
Performance Share Program is the terminology used to describe our equity program to better reflect the strong connection between performance and pay.
Compensation Benchmark Companies consist of AT&T, Boeing, Chevron, Ford, General Electric, General Motors, IBM, Johnson & Johnson, Pfizer, Procter & Gamble, United Technologies, and Verizon. These are the same companies noted in the 2018 Proxy Statement. For consistency, CEO compensation on page 40, in the Combined Realized and Unrealized Pay chart, is based on compensation as disclosed in the Summary Compensation Table of the proxy statements as of July 31, 2018.
Reported Payis Total Compensation reported in the Summary Compensation Table, except for years 2006 to 2008, where the grant date value of restricted stock as provided under current SEC rules is used to put all years of compensation on the same basis.Table.
Realized Payis compensation actually received by the CEO during the year, including salary, current bonus, payouts of previously granted Earnings Bonus Units (EBUs)earnings bonus units (EBU), net spread on stock option exercises, market value at vesting of previously granted stock-based awards, and All Other Compensation amounts realized during the year. It excludes unvested grants, change in pension value, and other amounts that will not actually be received until a future date. Amounts for compensation benchmark companies include salary, bonus, payouts ofnon-equity incentive plan compensation, and All Other Compensation as reported in the Summary Compensation Table, plus value realized on option exercise or stock vesting as reported in the Option Exercises and Stock Vested table. It excludes unvested grants, change in pension value, and other amounts that will not actually be received until a future date, as well as any retirement-related payouts from pension or nonqualified compensation plans.
Unrealized Payis calculated on a different basis fromthan the grant date fair value of awards used in the Summary Compensation Table. Unrealized Pay includes the value based on each compensation benchmark company’s closing stock price at fiscalyear-end 2014 2017 of unvested restricted stock awards; unvested long-term shareshare- and cash performancecash-performance awards, valued at target levels; and the “in the money” value of unexercised stock options (both vested and unvested). If a CEO retired during the period, outstanding equity is included assuming that unvested awards, as of the retirement date, continued to vest pursuant to the original terms of the award.
Compensation Benchmark CompaniesCash Flow from Operations and Asset Salesconsist is the sum of AT&T, Boeing, Caterpillar, Chevron, Ford Motor Company, General Electric, IBM, Johnson & Johnson, Pfizer, Procter & Gamble, United Technologies,the net cash provided by operating activities and Verizon. For consistency, CEO compensation is based on compensation as disclosed inproceeds associated with sales of subsidiaries, property, plant and equipment, and sales and returns of investments from the Summary Compensation TableStatement of Cash Flows. For additional information, see page 41 of theSummary Annual Report included with the proxy statements asCorporation’s 2019 Proxy Statement.
Return on Average Capital Employed (ROCE) for the Corporation is net income attributable to ExxonMobil excluding theafter-tax cost of August 31, 2015.financing, divided by total corporate average capital employed. For this purpose, capital employed means the Corporation’s net share of property, plant and equipment, and other assets less liabilities, excluding both short-term and long-term debt. For additional information, see pages 40 and 41 of theSummary Annual Report included with the Corporation’s 2019 Proxy Statement.
Total Shareholder Return (TSR) measures the change in value of an investment in stock over a specified period of time, assuming dividend reinvestment. TSR is subject to many different variables, including factors beyond the control of management. For additional information, see page 40 of theSummary Annual Report included with the Corporation’s 2019 Proxy Statement.
Statements regarding future events or conditions are forward-looking statements. Actual future results, including project plans, schedules, and results, as well as the impact of compensation incentives, could differ materially due toto: changes in oil and gas prices and other market factors affecting our industry,industry; the outcome of exploration and development projects; timely completion of production and construction projects; technical or operating conditions,conditions; the outcome of commercial negotiations; political and regulatory factors including changes in environmental and tax laws; and other factors described in Item 1A “Risk Factors”Risk Factors in our most recent Form10-K. References to oil-equivalent barrels and other quantities of oil and gas herein include amounts not yet classified as proved reserves under SEC rules, but which we believe will ultimately be moved into the proved category and produced.
The term “project” can refer to a variety of different activities and does not necessarily have the same meaning as in any government payment transparency reports.
2019 Proxy Statement | ![]() | 41 |
KEY ELEMENTS OF THE COMPENSATION PROGRAMFOOTNOTES
(1) Pay means the sum of Realized Pay and Unrealized Pay as discussed on page 40 and in the related Frequently Used Terms on page 41.
(2) For more information, see theSummary Annual Reportincluded with ExxonMobil’s 2019 Proxy Statement and available on our website atexxonmobil.com/annualreport.
(3) Example shows the integration of project net cash flow and performance share program design; illustrates that short-term vesting occurs prior to determination of project financial success or failure and that longer-term vesting better aligns with shareholder returns resulting from investment decisions. The project timeline is a hypothetical case that is representative of a typical major ExxonMobil project investment.
(4) For both the ExxonMobil and Alternate programs, 100 shares are granted each year from 2008 to 2017. For ExxonMobil performance share program, 50 percent of an annual grant of performance shares vests in 5 years and the other 50 percent vests in 10 years or retirement, whichever is later. For the hypothetical alternate formula-based program, shares vest after 3 years based on TSR performance. Values shown represent percent of target shares that would pay out based on ExxonMobil’s actual relative three-year TSR rank versus our industry peers (see footnote 8). Payout schedule as follows: 200% of target if ranked 1; 150% of target if ranked 2; 100% of target if ranked 3; 50% of target if ranked 4; and, 0% of target if ranked 5.
(5) Employees and contractors, includes XTO Energy Inc. data beginning in 2011.
(6) Workforce safety data from participating American Petroleum Institute (API) companies; 2018 industry data not available at time of publication.
(7) Competitor data estimated on a consistent basis with ExxonMobil and based on public information. ROCE data for Total available from 1999. For definitions and more information, see Frequently Used Terms on page 41.
(8) Industry peers include Chevron, Royal Dutch Shell, Total, and BP.
(9) Growth rate of an investor’s holdings with reinvestment of dividends. Chevron, Royal Dutch Shell, Total, and BP weighted by market capitalization to calculate average of industry peers.
(10) Benchmark companies are the same companies noted in the 2018 Proxy Statement. See Frequently Used Terms on page 41 for a full list of benchmark companies.
(11) Benchmark company data is based on public information. Data represents the fiscal year ending in 2018. Excludes sales-based taxes and intersegment revenues.
(12) Bonus program is based on estimates ofyear-end earnings made in November of each year, such that payment can occur in that calendar year. The purpose of thetwo-thirds adjustment in the formula is to mitigate the impact of commodity price swings on short-term earnings performance.
(13) 2018 benchmark company data not available at time of publication.
42 | ![]() | 2019 Proxy Statement |
Key Elements of the Compensation Program and Compensation Committee 2018 Decisions
The Company’s executive compensation program consists of base salary, annual bonus, and long-term equity in the form of restricted stock or restricted stock units.performance shares. Key design features and target allocations for these compensation elements are described on page 34. The Company also provides retirement plans in the form of pension and savings plans.plans, as described beginning on page 44.
The Compensation Committee determined thatand approved the following allocationindividual elements of 2018 compensation, as well as total compensation for each Named Executive Officer within the context of the compensation program structure. The Committee aligned the value with the performance of the Company, progress toward strategic objectives including strengthening the Company’s growth strategy, and results of annual compensation benchmarking given experience in the position, as described in the Executive Compensation Overview.
The performance share program accounts for the majority of annual pay granted, best supportsand is intended to align the business model, as well aspersonal financial interests of executives with the values, principles,returns of long-term shareholders and objectives asto encourage long-term decision making through the commodity price cycle.
The Compensation Committee sets the size of the performance share program. The Committee does not support a practice of offsetting a loss or gain in the value of prior performance share grants by the value of current year grants, which would minimize the risk/reward profile of stock-based awards and undermine the long-term view that executives are expected to adopt.
In 2018, the process and considerations applied by the Compensation Committee to determine the performance share grant to the CEO is described on pages 32page 36. The performance share grants for the other Named Executive Officers were determined using this same process.
Performance shares granted under this program are currently in the form of stock units.
Stock options have not been granted since 2001, and 33. The actual allocationthere are no plans to make such grants in the future.
Vesting and Restriction Periods
Performance share awards vest 50 percent in 5 years from grant date and 50 percent in 10 years or retirement, whichever is later.
Performance share awards are not subject to acceleration, not even at retirement, except in the case of these compensation elements can vary year-to-year baseddeath.
These restriction periods far exceed those applied across all industries, and better align with the long investment lead times of our business and the decisions that affect long-term shareholder value in our industry. For additional information on the performancebenefits of long-term restriction periods and the business.potential unintended consequences of an alternate program with shorter restriction periods, see page 35.
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Unvested performance share awards cannot be used as collateral for any purpose and are subject to forfeiture, even into retirement; see page 47.
The annual bonus program links compensation to annual business performance and encourages strong earnings performance in the overall sizenear- andmid-term while maintaining risk of the salary program.forfeiture.
Individual bonus grantsawards are then determined by the performance award matrix on page 33, which differentiates award levels by individual performancebonus program formula, changes in pay grade, and by pay grade. The performance award matrix is based on seven key financial and operating metrics.performance.
Half of the annual bonus is generallypaid in cash at time of grant, and the other half is delivered as shown below.Earnings Bonus Units (EBU) with delayed vesting. The delayed amount does not earn interest.
2019 Proxy Statement | ![]() | 43 |
Vesting of the EBU occurs when the cumulative earnings per share (EPS) threshold is achieved. If the cumulative EPS threshold is not reached within three years, the EBU is reduced to an amount equal to the number of units times the actual cumulative EPS over the three-year period.
– |
The EPS |
– | The |
The Committee also compares the total value of long-term equity awards against the combined value of all forms of long-term awards by each compensation benchmark company through an annual benchmarking process (see pages 32 and 41).bonus award in its entirety is subject to clawback; see page 47.
The delayed portion of the bonus (EBU) is also at risk of forfeiture; see page 47.
In 2018, the overall bonus program increased by 25 percent. Bonus awards for the Named Executive Officers that changed by more or less than the overall bonus program reflect their transition to make such grants inhigher pay grades and/or the future.results of individual performance assessments.
Vesting and Restriction PeriodsSalary
The overall size of the U.S. salary program for all U.S.-dollar-paid executives is later.determined by annual benchmarking.
The changes in salary for the Named Executive Officers are not subject to acceleration, even at retirement, except inconsistent with the case of death.base salary program, taking into account desired market orientation, individual performance, increased individual experience, and pay grade.
Salary decisions directly affect the long time frames over which business decisions affect long-term shareholder valuelevel of retirement benefits since salary is included in our industry. For additional information on the benefits of long-term vesting, see page 36.
Retirement plans include defined contribution plans, such as the Company’s savings plans, that are attractive to new hires as theywho can begin building an account balance immediately, and defined benefit plans, such as the Company’s pension plans (qualified and nonqualified), that are valuable in retaining help retainmid- and late-career employees. employees until retirement age. This objective to promote a long-term career is consistent with the long-term nature of the business.
Retirement plans also further strengthen commitment to high performance standards in that salary and bonus amounts, that form the basis for these plans, are determined by individual performance.
The Named Executive Officers participate in the same savings and pension plans as other U.S. executives.
Change in control is not a triggering event under any ExxonMobil benefit plan.
Savings Plans
The qualified Savings Plan permits employees to makepre- orpost-tax contributions and receive a Company-matching contribution of 7 percent of eligible salary to the extentwhen they contribute a minimum of 6 percent of salary. These contributions are subject to U.S. Internal Revenue Code limits on the amount of pay taken into account and the total amount of contributions. Qualified benefits are payable in a single lump sum or in partial withdrawals at any time after retirement.
The nonqualified Supplemental Savings Plan does not permit employee contributions but providesallows for continuation of the Company’s contribution of 7 percent of eligible pay to restore matching contributionssalary that couldwould not otherwise be made to the qualified planSavings Plan due to U.S. Internal Revenue Code limits. The nonqualified savings plan balance is paid in a single lump sum six months after retirement.
Pension Plans
• | Pay for the purpose of pension calculations includes base salary and bonus, but doesnot include stock-based awards. Inclusion of the annual bonus in the pension formula further strengthens the performance basis of the total compensation and benefits program. |
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The nonqualified Supplemental Pension Plan provides pension benefits to the extent annual salary exceeds the amount that can be considered in determining qualified pension benefits and to the extent other limits may apply to qualified benefits. Without the Supplemental Pension Plan, the retention power of the overall pension plan would be greatly reduced for employees earning more than that amount, since the increase in their pension values would not reflect the higher level of pay inmid- to late-career would be based on relatively flat final average pay.late-career.
The nonqualified Additional Payments Plan provides pension benefits with respecttied to the annual bonus, which further supports retention and performance objectives, and reinforces the Compensation Committee’s practice of linking a greater proportion of compensation to business results for more senior-levelmore-senior-level executives. Including annual bonus in the pension formula encourages executives to continue performing at a high level in order to maximize their pension value.
For more information on the pension plans, including the benefits formula, see pages 54 to 56.
In 2018, the annual change in pension value for Mr. Woods was positive, as shown in the Summary Compensation Table. For a breakdown of the underlying factors that resulted in the increase, see page 53.50. The annual change in pension value was also positive for Messrs. Chapman and Williams, primarily due to an increase in their final average annual bonus and salary, plus an additional year of service and age. For Messrs. Swiger and Duffin, the higher lump sum interest rate (3 percent) versus 2017 (2.75 percent) and a decrease in the final average annual bonus are contributing factors to the negative pension values discussed in the narrative to the Summary Compensation Table. These values are estimates; the actual values will be determined at the time each individual retires.
KEY ADDITIONAL FEATURES OF THE COMPENSATION PROGRAMGuidelines, Policies, and Practices
Consistent with the Compensation Committee’s practice of using well-informed judgment to determine overall executive compensation, the Committee focuses on a broad orientation, generally a range around the median compensation of our benchmark companies, which provides the ability to:
– | Differentiate compensation based on experience and performance levels among executives; |
– | Minimize the potential for automaticratcheting-up of compensation that could occur with a narrow target among benchmarked companies; |
– | Ensure that a |
– | Manage salaries based on a long-term career orientation; and |
– | Respond to changing business conditions. |
These benchmarking principles apply to salary, annual bonus, and long-term equityperformance share awards.
Annual benchmarking of compensation is performed against a peer group consisting of other U.S. companies that generally have large scale and complexity, capital intensity, international operations, and a business model that has proven to be sustainable over time. For a list of companies used to benchmark compensation, see page 41.
The Compensation Committee also uses tally sheets that provide detailed information, by pay element, and allow for assessment against publicly available data for similar positions at compensation benchmark companies.
Whether an executive’s total compensation is near, substantially below, or above the median is a qualitative factor the Compensation Committee considers along with Company performance, progress toward strategic objectives, individual performance, experience, and level of responsibility (see page 44).pay grade when determining individual compensation levels.
The Compensation Committee uses an independent consultant to assist in this analysis as discussed in the Corporate Governance sectionsection; see page 17.
2019 Proxy Statement | ![]() | 45 |
The Compensation Committee assesses the CEO’s performance and documents the basis on page 12.which compensation decisions are made.
Similarly, the CEO reviews the performance of all other senior executives with the Board of Directors during the annual executive development review in October of each year. In addition to this formal annual assessment, the Board also assesses the performance of all senior executives throughout the year during specific business reviews and Board Committee meetings.
The Compensation Committee relies on Company performance against industry peers based onpre-established performance metrics over investment lead times of the compensation benchmark companies, see page 32.business (10 years) and the Company’s progress toward its strategic objectives, as described on pages 36 to 39 .
– | While the performance metrics are not assigned a specific weight, safety and operations integrity performance and return on average capital employed (ROCE) are given the highest priority, as is progress toward the Company’s strategic objectives. |
ExxonMobil encourages safety and safety reporting throughout the Company. Applying a measure of safety results at the senior executive level is intended to hold senior leaders accountable for the overall results of the Company’s safety program.
The Committee also takes into account leadership demonstrated in sustaining sound business controls and a strong ethical and corporate governance environment.
– | A violation of the Company’s code of business conduct could result in elimination of an officer’s incentive award for the year, as well as termination of employment and/or cancellation of all previously granted awards that have not yet vested. |
Experience and level of responsibility are also considered in assessing the contributions of individual executives. Career service for Named Executive Officers ranges from 26 to more than 40 years. The most recent responsibilities for the Named Executive Officers are outlined below.
Name | Principal Position | |||||
D.W. Woods | – Chairman of the Board and CEO since January 2017 – President and member of the Board since January 2016 – Senior Vice President in 2014 and 2015 – More information regarding his career history is on page 24 | |||||
A.P. Swiger | – Principal Financial Officer (PFO) since 2013 – Senior Vice President since 2009 | |||||
N.A. Chapman | – Senior Vice President since January 2018 – President of ExxonMobil Chemical Company and Vice President of Exxon Mobil Corporation from 2015 through 2017 | |||||
J.P. Williams, Jr. | – Senior Vice President since June 2014 | |||||
N.W. Duffin | – President of ExxonMobil Global Projects Company effective April 2019 – President of ExxonMobil Production Company and Vice President of Exxon Mobil Corporation from 2017 to March 2019 |
Each year, the Compensation Committee establishes a ceiling for long-term equityperformance share awards. The overall number of shares underlying awards granted in 20152018 represents dilution of 0.2 percent. This dilution is more than 63 percentabout65-percent below the average of the companies benchmarked for compensation, based on historical grant patterns. The effect is a lower relative impact on earnings per share at time of grant versus the compensation benchmark companies.
46 | ![]() | 2019 Proxy Statement |
The Company has a long-established practice of purchasing shares in the open market and through negotiated transactions to offset the dilutive effect of shares or units settled in shares issued under the equityperformance share program.
The Compensation Committee grants incentive awards to the Company’s senior executives at its regular November meeting and does not do so by written consent. The Committee also made a bonus and equity award grant to Mr. Woods in December 2015 at the time of his election as President.
A committee comprised of ExxonMobil’s Chairman President, and Senior Vice Presidents grants incentive awards to other eligible employees within the parameters of the bonus and equityperformance share award ceilings approved by the Compensation Committee. TheThis committee makes annual grants on a schedule aligned with the schedule of the Compensation Committee, determines when this committee meets to make such grants.
• | It is ExxonMobil’s policy that executives maintain significant stock ownership during employmentand for many years into retirement. ExxonMobil’s long restriction periods on performance shares result in required stock ownership that far exceeds the typical standard ownership guideline of 6 times base salary. |
Name | Dollar Value of Stock Ownership as a Multiple of Salary | Percent of Shares/Units Restricted | Dollar Value of Stock Ownership as a Multiple of Salary | Percent of Shares Restricted | ||||||||||||||
R.W. Tillerson | 64 | 77 | ||||||||||||||||
D.W. Woods | 28 | 89 | 32 | 90 | ||||||||||||||
A.P. Swiger | 50 | 73 | 52 | 73 | ||||||||||||||
M.W. Albers | 46 | 90 | ||||||||||||||||
M.J. Dolan | 53 | 83 | ||||||||||||||||
N.A. Chapman | 31 | 92 | ||||||||||||||||
J.P. Williams, Jr. | 30 | 89 | ||||||||||||||||
N.W. Duffin | 40 | 82 | ||||||||||||||||
All Other U.S.-Dollar-Paid Executive Officers (Average) | 29 | 80 | 23 | 82 |
Company policy prohibits all active executives, management, professional, or technical employees including executives, from entering into putpurchasing or callselling puts, calls, other options, or futures contracts on ExxonMobil common stock or futures contracts ontrading in the oil or gas.gas futures markets.
Clawback Policy and Forfeiture Provisions
In the event of a material negative restatement of ExxonMobil’s reported financial or operating results, the Board is authorized to take actions as it deems necessary and appropriate, including the recoupment (clawback) of any bonus (cash or earnings bonus units) paid to an executive officer. This recoupment policy reflects the Company’s high ethical standards and strict compliance with accounting and other regulations applicable to public companies.
The delayed portion of the annual bonus and unvested long-term equityperformance share awards are at risk of forfeiture in case of early retirement and/or detrimental activity if an executive:
– | Leaves the Company before standard retirement time (defined as age 65 for U.S. employees). In the event of retirement prior to the age of 65 but after eligibility for early retirement (i.e., at least 55 years of age |
2019 Proxy Statement | ![]() | 47 |
– | Engages in activity that is detrimental to the Company, even if such activity occurs or is discovered after retirement. |
The uniquely long vesting periods of performance shares substantially increase the percentage of career compensation at risk of forfeiture due to detrimental activity.
• | The CEO and other |
This eliminates any real or perceived “safety net” with respect to job security and increases the risk and consequences to the individual offor performance that does not meet the highest standards.
The Company does not provide tax assistance for either bonus or equityperformance share awards.
Starting in 2018, the intention to meet the requirements for deductibility asU.S. Internal Revenue Code was amended so that annual compensation, including performance-based compensation, under Section 162(m)in excess of the Internal Revenue Code. This permits the Company to deduct certain compensation$1 million paid to the CEO, the Principal Financial Officer (PFO), and the other three most highly paid executives is not tax deductible by the Corporation. This amendment applies to bonuses and performance shares granted beginning in November 2017 and later. It also applies to nonqualified pensions and other than the Principal Financial Officer (PFO) if compensation is in excess of $1 million.
A transition rule preserves the tax deductibility of bonuses, performance shares, and nonqualified pension benefits awarded or accrued prior to November 2017 underpre-amendment U.S. Internal Revenue Code provisions.
Executives may not elect to defer any element of compensation prior to retirement.
Nonqualified pension and other benefits have been designed in a manner intended to avoid additional taxes that could potentially be imposed on the recipients of such amounts by Section 409A of the U.S. Internal Revenue Code. This is achieved by setting the form and timing of distributions to eliminate executive and Company discretion.
The above Tax Matters discussion of tax consequences is based on the Company’s interpretation of current U.S. tax laws.
COMPENSATION COMMITTEE 2015 DECISIONSShareholder Engagement and PriorSay-on-Pay Vote
It has been a capital-intensive industry requiring long investment lead timeslong-standing practice to actively engage with our shareholders and a significant focusproxy advisors throughout the year. These engagements provide an opportunity to better understand their perspectives on risk management. The structure ofexecutive compensation and to discuss the rationale behind our compensation program fully supportsdesign and how it aligns pay with performance.
In 2018, we continued a broad shareholder engagement strategy. We enhanced this business modelyear’s disclosure in response to the feedback received, as described on page 33.
During the Compensation Committee’s annual review, they also considered the insights gained from this extensive shareholder dialogue; the results of the 2018 advisory vote on executive compensation, in which 73 percent of votes cast were FOR the compensation of the Named Executive Officers; and aligns the interestseffectiveness and competitiveness of our executives with long-term shareholders. This is particularly relevant giventhe executive compensation program.
The Committee also evaluated an alternate target-setting method of granting compensation, as described on page 35 ; and received input from its independent consultant regarding this alternate method. The Committee continues to support the current statedesign of the industry.
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Pay Awarded to Named Executive Officers
Upstream
Downstream
Chemical
More details on ExxonMobil’s strategic business results and strategies are available in theSummary Annual Report included with the 2016 Proxy Statement.
2015 Compensation for Named Executive Officers
Salary
Bonus (Cash plus full value of EBU award)
Equity Awards
Pension (Change in Pension Value)
All Other Compensation
Summary Compensation Table for 20152018
Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | Non- Equity sation ($) | Change in Pension Value and Nonqualified Deferred Compen- sation Earnings ($) | All Other Compen- sation ($) | Total ($) | |||||||||||||||||||||||||
R.W. Tillerson Chairman and CEO |
| 2015 2014 2013 |
|
| 3,047,000 2,867,000 2,717,000 |
| 2,386,000 3,670,000 3,670,000 |
| 18,288,000 21,420,000 21,254,625 |
|
| 0 0 0 |
|
| 0 0 0 |
|
| 3,036,167 4,683,892 0 |
|
| 540,291 455,420 496,704 |
|
| 27,297,458 33,096,312 28,138,329 |
| |||||||||
D.W. Woods President(1) | 2015 | 736,667 | 1,219,000 | 7,241,492 | 0 | 0 | 954,492 | 143,221 | 10,294,872 | |||||||||||||||||||||||||
A.P. Swiger Senior Vice President; PFO |
| 2015 2014 2013 |
|
| 1,228,750 1,142,500 1,052,500 |
| 1,409,000 1,876,000 1,876,000 |
| 8,648,192 8,644,160 8,577,422 |
|
| 0 0 0 |
|
| 0 0 0 |
|
| 3,489,861 4,355,277 640,703 |
|
| 126,559 116,619 112,596 |
|
| 14,902,362 16,134,556 12,259,221 |
| |||||||||
M.W. Albers Senior Vice President |
| 2015 2014 2013 |
|
| 1,232,500 1,162,500 1,092,500 |
| 1,409,000 1,876,000 1,876,000 |
| 8,648,192 8,644,160 8,577,422 |
|
| 0 0 0 |
|
| 0 0 0 |
|
| 3,277,380 4,337,214 0 |
|
| 129,265 135,215 111,791 |
|
| 14,696,337 16,155,089 11,657,713 |
| |||||||||
M.J. Dolan Senior Vice President |
| 2015 2014 2013 |
|
| 1,322,500 1,252,500 1,175,000 |
| 1,635,000 2,168,000 2,168,000 |
| 10,078,720 10,129,280 10,051,076 |
|
| 0 0 0 |
|
| 0 0 0 |
|
| 1,565,725 2,360,606 395,472 |
|
| 147,587 139,827 126,600 |
|
| 14,749,532 16,050,213 13,916,148 |
|
Name and Principal Position
| Year
| Salary ($)
| Bonus ($)
| Stock Awards ($)
| Option Awards ($)
| Non- Equity sation ($)
| Change in Pension Value and Nonqualified Deferred Compen- sation Earnings ($)
| All Other Compen- sation ($)
| Total ($)
| |||||||||||||||||||||||
D.W. Woods Chairman and CEO | | 2018 2017 2016 |
| | 1,400,000 1,200,000 1,000,000 |
| | 2,464,000 1,848,000 1,232,000 |
| | 11,648,250 10,809,810 12,014,215 |
| 0 0 0 | 0 0 0 | | 2,977,497 3,325,779 2,179,208 |
| | 288,040 282,544 421,505 |
| | 18,777,787 17,466,133 16,846,928 |
| |||||||||
A.P. Swiger Senior Vice President; PFO | | 2018 2017 2016 |
| | 1,395,750 1,337,500 1,287,500 |
| | 1,848,000 1,603,000 986,000 |
| | 8,666,298 8,123,736 9,330,748 |
| 0 0 0 | 0 0 0 | | 0 0 3,805,931 |
| | 158,830 151,738 146,568 |
| | 12,068,878 11,215,974 15,556,747 |
| |||||||||
N.A. Chapman Senior Vice President
| 2018 | 833,000 | 1,276,000 | 5,979,435 | 0 | 0 | 1,096,572 | 417,999 | 9,603,006 | |||||||||||||||||||||||
J.P. Williams, Jr. Senior Vice President
| 2018 | 929,167 | 1,276,000 | 5,979,435 | 0 | 0 | 1,100,069 | 78,115 | 9,362,786 | |||||||||||||||||||||||
N.W. Duffin Vice President; President,
| | 2018 2017 |
| | 1,107,000 1,063,250 |
| | 1,175,000 1,021,000 |
| | 5,381,492 5,675,150 |
| 0 0 | 0 0 | | 0 0 |
| | 125,050 120,349 |
| | 7,788,542 7,879,749 |
|
(1) | Mr. |
Terms of Employment AgreementsCompensation Adjusted for Negative Change in Pension
In 2018, the annual change in pension value was negative for Messrs. Swiger and Duffin. However, SEC regulations do not have employment agreements.allow for inclusion of negative pension amounts in the Summary Compensation Table. The following pro forma table reflects the impact of the negative pension value on 2018 compensation:
Name | Reported Pay from Table Above ($) | 2018 Negative Pension | 2018 Total Adjusted Pay ($) | |||||||||||
2017 | 2018 | |||||||||||||
A.P. Swiger
|
| 11,215,974
|
|
| 12,068,878
|
| -405,589
|
| 11,663,289
|
| ||||
N.W. Duffin
|
| 7,879,749
|
|
| 7,788,542
|
| -784,870
|
| 7,003,672
|
|
Salary
Effective January 1, 2016,2019, the annual salary was increased for Mr. TillersonWoods to $3,167,000;$1,500,000 and Mr. WoodsChapman to $1,000,000.$895,000. Effective April 1, 2016,2019, the annual salary was increased for Mr. Swiger to $1,300,000; Mr. Albers to $1,300,000;$1,489,000; and Mr. DolanDuffin to $1,400,000.$1,181,000.
For more details on the design of the salary program and pages 44 to 46 for more details ondecisions made by the Compensation Committee 2015 decisions.
in 2018, see page 44.
Bonus
The 20152018 bonus was paidone-half in cash at the time of grant. The Company delays paymentvesting of the balance until cumulative earnings reach $6.50 per share. Delayed bonus amounts do not earn interest.
For more details on the design of the bonus program and pages 44 to 46 for more details ondecisions made by the Compensation Committee 2015 decisions.in 2018, see pages 40 and 43.
2019 Proxy Statement | ![]() | 49 |
Stock Awards
In accordance with disclosure regulations, the valuation of stock awards in this table represents the grant date fair value, which is equal to the number of RSUsperformance shares awarded times the grant price. Grant price is deemed to be the average of the high and low sale prices on the NYSE on the grant date: $81.28$77.66 on November 24, 2015; $76.03 on December 9, 2015 (with respect to a supplemental award made to Mr. Woods in connection with his election as President); $95.2028, 2018; $81.89 on November 25, 2014;29, 2017; and $94.47$87.70 on November 26, 2013.30, 2016.
For more details on the design of the performance share program and decisions made by the Compensation Committee in 2018, see pages 34 to 39 and 43.
Change in Pension Value and Nonqualified Deferred Compensation Earnings
The amounts shown in this column in the Summary Compensation Table solely represent the positive change in pension value. The Corporation’s nonqualified deferred compensation plan (Supplemental Savings Plan) does not permit accrual of above-market or preferential earnings.
Pension Value
The change in pension value shown in the table for 20152018 is the increase betweenyear-end 2014 2017 andyear-end 2015 2018 in the present value of each executive’s pension benefits under the plans described in more detail beginning on page 53.
Factors | Change in Pension Value (Percent) | Change in Present Value ($) | ||||
Lower Lump Sum Interest Rate | 2.6 | 1,693,212 | ||||
Change in Final Average Bonus | 0 | 0 | ||||
Change in Final Average Salary | 2.3 | 1,536,996 | ||||
Age and Service | –0.3 | –194,041 | ||||
Total | 4.6 | 3,036,167 |
Factors | Change in Pension Value (%) | Change in Present Value ($) |
| ||||||||||||
Change in Interest Rates | -12 | -1,375,176 | |||||||||||||
Change in Final Average Bonus | 18 | 2,166,301 | |||||||||||||
Change in Final Average Salary | 10 | 1,154,183 | |||||||||||||
Age and Service | 9 | 1,032,189 | |||||||||||||
Total | 25 | 2,977,497 |
All Other Compensation
The following table breaks down the amounts included in the All Other Compensation column of the Summary Compensation Table for 2015.2018.
Name | Life Insurance ($) | Savings Plan ($) | Personal ($) | Personal Use of Company | Financial ($) | Relocation ($) | Total ($) | Life Insurance ($) | Savings Plan ($) | Personal Security ($) | Personal Use of Company | Financial Planning ($) | Relocation ($) | Total ($) | ||||||||||||||||||||||||||||||||||
Aircraft ($) | Properties/Car ($) | Aircraft ($) | Car ($) | |||||||||||||||||||||||||||||||||||||||||||||
R.W. Tillerson | 96,054 | 213,290 | 122,675 | 73,856 | 23,726 | 10,690 | 0 | 540,291 | ||||||||||||||||||||||||||||||||||||||||
D.W. Woods | 0 | 51,567 | 15,184 | 0 | 61 | 9,363 | 67,046 | 143,221 | 0 | 98,000 | 84,155 | 94,459 | 0 | 11,426 | 0 | 288,040 | ||||||||||||||||||||||||||||||||
A.P. Swiger | 25,215 | 86,013 | 4,641 | 0 | 0 | 10,690 | 0 | 126,559 | 44,056 | 97,702 | 5,646 | 0 | 0 | 11,426 | 0 | 158,830 | ||||||||||||||||||||||||||||||||
M.W. Albers | 25,319 | 86,275 | 961 | 0 | 6,020 | 10,690 | 0 | �� | 129,265 | |||||||||||||||||||||||||||||||||||||||
M.J. Dolan | 41,712 | 92,575 | 1,757 | 0 | 853 | 10,690 | 0 | 147,587 | ||||||||||||||||||||||||||||||||||||||||
N.A. Chapman | 17,120 | 58,310 | 4,664 | 0 | 0 | 0 | 337,905 | 417,999 | ||||||||||||||||||||||||||||||||||||||||
J.P. Williams, Jr. | 0 | 65,042 | 1,647 | 0 | 0 | 11,426 | 0 | 78,115 | ||||||||||||||||||||||||||||||||||||||||
N.W. Duffin | 34,944 | 77,490 | 1,118 | 0 | 72 | 11,426 | 0 | 125,050 |
Life Insurance
Messrs. Woods and Williams participate in the program except for Mr. Woods who participates only in the Company’s broad-based employee life insurance program.program that provides coverage that equals 2 times base salary as an active employee. As permitted by disclosure regulations, the premium cost for a broad-based employee life insurance program is not required to be reported and therefore is excluded from this table.
The other Named Executive Officers participate in the Company’s senior executive term life insurance program that provides coverage of 4 times base salary until age 65 and a declining multiple thereafter until age 75, at which point the multiple remains at 2.5 times salary. The Company eliminated this program for all newly eligible senior executives as of October 2007.
50 | ![]() | 2019 Proxy Statement |
For executives with senior executive term life insurance coverage, the premium cost in any year depends on overall financial and mortality experience under the group policy. For executives electing the death benefit, there is no cash cost until the executive dies, as benefitsThe amounts shown are paid directly by the Company.
Savings Plan
The amount shown is the value of Company-matching contributions under ExxonMobil’stax-qualified savings plan and Company credits under the related nonqualified supplemental plan. For a description of the savings plan, see page 44.
Personal Security
The Company provides security for its employees, as appropriate, based on an assessment of risk, which includes consideration of the employee’s position and work location.
The Company does not consider any such security costs to be personal benefits since these costs arise from the nature of the employee’s employment by the Company. However, the disclosure regulations require certain security costs to be reported as personal benefits.
The car provided for security reasons and used primarily for commuting is valued based on the annualized cost of the car plus maintenance and fuel. Reported costs for rental cars utilized due tofor security concerns during personal travel are the actual incremental costs.
For security personnel employed by the Company, the cost is the actual incremental cost of expenses incurred by the security personnel. Total salary, wages, and benefits are not allocated because the Company already incurs these costs for business purposes.
For security contractors, the cost is the actual incremental cost of such contractors associated with the executive’s personal time.
For Mr. Tillerson,Woods, the amount shown includes $84,310 for residential security and $27,013$49,787 for the cost of his car provided for security reasons as described above. Theabove; the remainder is for security costs relatingrelated to personal travel, residential security, and other communications equipment to conduct business in a secure manner.
Aircraft
For security reasons, the Board requires the Chairman and CEO to use the Company aircraft for both business and personal travel. The Compensation Committee considers these costs to be necessary security-related business expenses rather than perquisites, but per the disclosure regulations, the incremental cost of aircraft usage for personal travel is reported.
Incremental cost for personal use of the aircraft is based on direct operating costs (fuel, airport fees, incremental pilot costs, etc.) and does not include capital costs of the aircraft since the Company already incurs these costs for business purposes.
Properties/Company Car
2019 Proxy Statement | ![]() | 51 |
Financial Planning
The Company provides financial planning services to senior executives, which includes tax preparation. This benefit is valued based on the actual charge for the services.
Relocation
The Company provides relocation assistance to all eligible employees on a consistent basis.
Grants of Plan-Based Awards for 20152018
Name | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards | Estimated Future Payouts Under Equity Incentive Plan Awards | All Stock Awards: Number of of Stock or Units (#) | All Other Option Awards: Number Securities Under- lying Options (#) | Exercise Base of Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards ($) | Grant Date | Estimated Future Payouts UnderNon-Equity Incentive Plan Awards | Estimated Future Payouts Under Equity Incentive Plan Awards | All Other Stock Awards: Number of of Stock or Units (#) | All Other Option Awards: Number Securities Under- lying Options (#) | Exercise Base of Awards ($/Sh) | Grant Date Option | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Thresh ($) | Tar- get ($) | Maxi- mum ($) | Thresh -old (#) | Tar- get (#) | Maxi- mum (#) | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
R.W. Tillerson | 11/24/2015 | 0 | 0 | 0 | 0 | 0 | 0 | 225,000 | 0 | 0 | 18,288,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
D.W. Woods |
| 11/24/2015 12/09/2015 |
|
| 0 0 |
|
| 0 0 |
|
| 0 0 |
|
| 0 0 |
|
| 0 0 |
|
| 0 0 |
|
| 64,400 26,400 |
|
| 0 0 |
|
| 0 0 |
|
| 5,234,432 2,007,060 |
|
| 11/28/2018 |
| 0 | 0 | 0 | 0 | 0 | 0 |
| 150,000 |
| 0 | 0 |
| 11,648,250 |
| ||||||||||||||||||||||
A.P. Swiger | 11/24/2015 | 0 | 0 | 0 | 0 | 0 | 0 | 106,400 | 0 | 0 | 8,648,192 |
| 11/28/2018 |
| 0 | 0 | 0 | 0 | 0 | 0 |
| 111,600 |
| 0 | 0 |
| 8,666,298 |
| ||||||||||||||||||||||||||||||||||||||||||||
M.W. Albers | 11/24/2015 | 0 | 0 | 0 | 0 | 0 | 0 | 106,400 | 0 | 0 | 8,648,192 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
M.J. Dolan | 11/24/2015 | 0 | 0 | 0 | 0 | 0 | 0 | 124,000 | 0 | 0 | 10,078,720 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
N.A. Chapman |
| 11/28/2018 |
| 0 | 0 | 0 | 0 | 0 | 0 |
| 77,000 |
| 0 | 0 |
| 5,979,435 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
J.P. Williams, Jr. |
| 11/28/2018 |
| 0 | 0 | 0 | 0 | 0 | 0 |
| 77,000 |
| 0 | 0 |
| 5,979,435 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
N.W. Duffin |
| 11/28/2018 |
| 0 | 0 | 0 | 0 | 0 | 0 |
| 69,300 |
| 0 | 0 |
| 5,381,492 |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||
In 2015, equity2018, performance share grants were made in the form of restricted stock units (RSUs).units. Each RSUstock unit represents one share of ExxonMobil common stock. RSUsPerformance shares granted to the Named Executive Officers may only be settled only in shares.stock. During the restricted period, for RSUs, the executive receives a cash payment on each RSUperformance share corresponding to the cash dividends paid on an outstanding share of ExxonMobil stock. Unlike common stock, performance shares of restrictedgranted in stock RSUsunits do not carry voting rights prior to settlement.
Restrictions and Forfeiture Risk
For details regarding ExxonMobil’s restrictions and forfeiture provisions, see pages 4043 and 43.47.
Grant Date
The grant date is the same as the date on which the Compensation Committee of the Board met to approve the awards. For details of grant date fair value, see page 48.50.
52 | ![]() | 2019 Proxy Statement |
Outstanding Equity Awards at FiscalYear-End for 20152018
Name | Option Awards | Stock Awards | Option Awards | Stock Awards | ||||||||||||||||||||||||||||||||||||||||||||||||||
Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price | Option Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of | Equity Awards: | Equity Incentive Awards: Market or Rights That Vested ($) | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Equity Incentive | Option Exercise Price | Option Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of | Equity Awards: Rights That | Equity Incentive Awards: Market or Rights That Vested ($) | |||||||||||||||||||||||||||||||||||||
R.W. Tillerson | 0 | 0 | 0 | 0 | — | 1,913,500 | 149,157,325 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||
D.W. Woods | 0 | 0 | 0 | 0 | — | 237,500 | 18,513,125 | 0 | 0 | 0 | 0 | 0 | 0 | — | 591,850 | 40,358,252 | 0 | 0 | ||||||||||||||||||||||||||||||||||||
A.P. Swiger | 0 | 0 | 0 | 0 | — | 575,750 | 44,879,713 | 0 | 0 | 0 | 0 | 0 | 0 | — | 767,050 | 52,305,140 | 0 | 0 | ||||||||||||||||||||||||||||||||||||
M.W. Albers | 0 | 0 | 0 | 0 | — | 661,150 | 51,536,643 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||
M.J. Dolan | 0 | 0 | 0 | 0 | — | 744,400 | 58,025,980 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||
N.A. Chapman | 0 | 0 | 0 | 0 | — | 344,600 | 23,498,274 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||
J.P. Williams, Jr. | 0 | 0 | 0 | 0 | — | 357,000 | 24,343,830 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||||||
N.W. Duffin | 0 | 0 | 0 | 0 | — | 530,150 | 36,150,929 | 0 | 0 |
Stock Awards (Restricted Stock and RSUs)(Performance Shares)
Performance shares shown in the table above include both restricted stock and RSUs. Restricted stock awardsunits. The market value is based on the 2018year-end closing stock price of $68.19 and this value has not been risk adjusted. These performance shares have the same terms, as RSUs, except that restricted stock awardsunits do not include voting rights. For more information regarding the terms of RSUs,performance share program, see page 40.
Name | Date Restrictions Lapse and Number of Shares/Units | Date Restrictions Lapse and Number of Performance Shares
| ||||||||||||||||||||||||||||||||||||||
2016 | 2017 | 2018 | 2019 | 2020 | 10 Years or Retirement, Whichever Occurs Later | Retirement(1) | 2019
| 2020
| 2021
| 2022
| 2023
| 10 Years or Retirement,
| ||||||||||||||||||||||||||||
R.W. Tillerson | 112,500 | 112,500 | 112,500 | 112,500 | 112,500 | 1,333,000 | 18,000 | |||||||||||||||||||||||||||||||||
D.W. Woods | 7,350 | 25,350 | 31,950 | 23,400 | 45,400 | 104,050 | 0 | 23,400
| 45,400
| 68,500
| 66,000
| 75,000
| 313,550
| |||||||||||||||||||||||||||
A.P. Swiger | 38,500 | 42,000 | 45,400 | 45,400 | 53,200 | 351,250 | 0 | 45,400
| 53,200
| 53,200
| 49,600
| 55,800
| 509,850
| |||||||||||||||||||||||||||
M.W. Albers | 42,000 | 45,400 | 45,400 | 45,400 | 53,200 | 429,750 | 0 | |||||||||||||||||||||||||||||||||
M.J. Dolan | 45,400 | 49,300 | 53,200 | 53,200 | 62,000 | 481,300 | 0 | |||||||||||||||||||||||||||||||||
N.A. Chapman
| 19,550
| 23,400
| 23,400
| 24,750
| 38,500
| 215,000
| ||||||||||||||||||||||||||||||||||
J.P. Williams, Jr.
| 23,400
| 32,200
| 32,200
| 25,750
| 38,500
| 204,950
| ||||||||||||||||||||||||||||||||||
N.W. Duffin
| 32,200
| 32,200
| 38,500
| 34,650
| 34,650
| 357,950
|
2019 Proxy Statement | ![]() | 53 |
Option Exercises and Stock Vested for 20152018
Name | Option Awards | Stock Awards | Option Awards | Stock Awards | ||||||||||||||||||||
Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares (#) | Value Realized on Vesting ($) | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | |||||||||||||||||
R.W. Tillerson | 0 | 0 | 112,500 | 8,986,500 | ||||||||||||||||||||
D.W. Woods | 0 | 0 | 6,450 | 526,578 | 0
| 0
| 31,950
| 2,479,437
| ||||||||||||||||
A.P. Swiger | 0 | 0 | 34,250 | 2,735,890 | 0
| 0
| 45,400
| 3,483,429
| ||||||||||||||||
M.W. Albers | 0 | 0 | 38,500 | 3,075,380 | ||||||||||||||||||||
M.J. Dolan | 0 | 0 | 42,000 | 3,354,960 | ||||||||||||||||||||
N.A. Chapman
| 0
| 0
| 19,550
| 1,500,023
| ||||||||||||||||||||
J.P. Williams, Jr.
| 0
| 0
| 16,800
| 1,289,022
| ||||||||||||||||||||
N.W. Duffin
| 0
| 0
| 32,200
| 2,470,626
|
Stock Awards/Restriction Lapse in 20152018
In 2015,2018, restrictions lapsed on 50 percent of restricted stock unit (RSU)performance share awards that were granted in 2010.2013. For Mr. Woods, restrictions also lapsed on 50 percent of cash-settled RSUperformance share awards that were granted in 2008. See notes2011. These shares were granted before he became a senior executive and were subject to Outstanding Equity Awards at Fiscal Year-End for 2015 table fora different vesting schedule (7 years from grant date) than his current and more information.recent awards, but otherwise had the same terms as awards granted to other senior executives.
The number of shares acquired on vesting is the gross number of shares to which the award relates. The value realized is the gross number of shares times the market price, which is the average of the high and low sale prices on the NYSE on the date that the restrictions lapse.
The net number of shares acquired (gross number of shares less shares withheld for taxes) are 65,30619,377 for Mr. Tillerson; 19,882Woods; 27,535 for Mr. Swiger; 22,34911,857 for Mr. Albers; and 24,381Chapman; 10,189 for Mr. Dolan.Williams; and 19,529 for Mr. Woods received a cash payment on his vested award corresponding to the gross number of underlying shares (valued at the average of the high and low sale prices on the NYSE on the date the restrictions lapse) minus withholding taxes.Duffin.
Refer to the Equity AwardsPerformance Share Program section on page 4043 for additional information.
Name | Plan Name | Number of (#) | Present Value of ($) | Payments During Last Fiscal Year ($) | ||||||||||||||||||||
| ExxonMobil Pension Plan ExxonMobil Supplemental Pension Plan ExxonMobil Additional Payments Plan | 26.34
|
26.34 | | 1,231,591(a)
4,593,606(b) 9,127,855(b) | |
|
| ||||||||||||||||
| 0 0 0 | |||||||||||||||||||||||
A.P. Swiger | ExxonMobil Pension Plan ExxonMobil Supplemental Pension Plan ExxonMobil Additional Payments Plan | 40.33
|
40.33 | | 2,475,442
10,624,251 17,626,761 | |
|
|
| |||||||||||||||
| 0 0 0 | |||||||||||||||||||||||
N.A. Chapman | ExxonMobil Pension Plan ExxonMobil Supplemental Pension Plan ExxonMobil Additional Payments Plan | 34.34
|
34.34 | | 1,805,761
3,788,105 7,031,808 | |
|
| ||||||||||||||||
| 0 0 0 | |||||||||||||||||||||||
J.P. Williams, Jr. | ExxonMobil Pension Plan ExxonMobil Supplemental Pension Plan ExxonMobil Additional Payments Plan | 31.70
|
31.70 | | 1,564,271
3,837,371 6,649,942 | |
|
| ||||||||||||||||
| 0 0 0 | |||||||||||||||||||||||
N.W. Duffin | ExxonMobil Pension Plan ExxonMobil Supplemental Pension Plan ExxonMobil Additional Payments Plan | 39.25
|
39.25 | | 2,440,928
7,779,089 11,559,411 | |
| 0
| 0
|
0 |
(a) | The Present Value of Accumulated Benefit figure for the ExxonMobil Pension Plan for Mr. Woods is calculated as if he were eligible for early retirement (i.e., at least 55 years of age with at least 15 years of service). Because Mr. Woods is not yet 55 years of age, he would not be eligible to receive a |
(b) | In the event of termination prior to early retirement eligibility, there is no benefit payable under the Supplemental Pension Plan or Additional Payments Plan. The Present Value of Accumulated Benefit figure for these plans for Mr. Woods is calculated as if he were eligible for early retirement, even though he is not eligible as ofyear-end |
54 | ![]() | 2019 Proxy Statement |
Pension Plans
Retirement benefit plans (qualified and nonqualified) provide an annual benefit of 1.6 percent of final average pay per year of service, with the qualified plan having an offset for Social Security benefits. SeeFor a description, see page 41 for a description.44. Below are the calculations and forms of payments for each plan:
Plan Name | Calculation | Forms of Payment | ||
Pension Plan (qualified) | 1.6% x final average salary(1) x years credited service, less a | Benefit available as a lump sum or in various annuity forms | ||
Supplemental Pension Plan (nonqualified) | 1.6% x final average salary(1) x years credited service | Paid in the form of an equivalent lump sum six months after retirement | ||
Additional Payments Plan (nonqualified) | 1.6% x average annual bonus(2) x years credited service | Paid in the form of an equivalent lump sum six months after retirement |
(1) | Final average salary is the average of the highest 36 consecutive months in the 10 years of service prior to retirement. For the Pension Plan, final average salary included and benefits paid are subject to the limits on compensation ($ |
(2) | Average annual bonus is the average of the annual bonus for the three highest grants of the last five awarded prior to retirement (including the portion of the annual bonus that is paid at time of grant and the portion that is paid on a delayed basis as described beginning on page |
Present Value Pension Calculations
The present value of accumulated benefits shown in the Pension Benefits table is determined by converting the annuity values earned as of year end to lump sum values payable at age 60 (or at the employee’s actual age, if older) using the applicable mortality tables and interest rate that would apply to a participant who retiredrates.
The value shown in the first quarterPension Benefits table is the accumulated benefit as of 2016.year-end 2018. The value shown in the Summary Compensation Table on page 49 represents the annual increase in the value of the pension betweenyear-end 2017 and 2018.
The lump sum interest rate was 2.75 percent. For other participants (including Mr. Woods),rates used to calculate the plan specifies short-, medium-accumulated benefits in the Pension Benefits table and long-term interest rate assumptions for this purpose, which were 1.69 percent, 4.08 percent, 5.03 percent respectively.Summary Compensation Table were:
– | For plan participants who had attained age 50 with at least 10 years of service before January 1, 2008 (including Messrs. Swiger and Duffin), the lump sum interest rates for an employee who worked through the end of 2017 was 2.75 percent and through the end of 2018 was 3 percent. |
– | For other participants (including Messrs. Woods, Chapman, and Williams), the plan specifies short-, medium-, and long-term interest rate assumptions for this purpose. The lump sum interest rates for an employee who worked through the end of 2017 were 1.95 percent, 3.58 percent, and 4.36 percent, respectively, and through the end of 2018 were 3.16 percent, 4.21 percent, and 4.51 percent, respectively. |
– | The actual lump sum conversion factors that will apply when each executive retires may be different. |
For executives who wereemployees not yet age 60, theseage-60 lump sum values are discounted to present values based on the time difference between the individual’s age atyear-end 2018 and age 60 (and atyear-end 2017 and age 60 for the annual increase in pension calculation in the Summary Compensation Table) using the interest rates for valuing financial reporting of pension obligations as of each year end. The discount rate for determining the present value of benefits was 3.8 percent as ofyear-end 2015 of each executive’s age-60 lump sum is determined using a discount rate of 4.25 2017 and 4.4 percent the rate used for valuing pension obligations for purposesas of the Corporation’s financial statements for 2015.year-end 2018.
Effect of Early TerminationRetirement or Death
The Named Executive Officers have not received any additional service credit. Actual service is reflected in the table on page 53.54.
All three pension plans require completion of 15 years of service and attainment of age 55 to be eligible for early retirement. All Named Executive Officers have satisfied this requirement except for Mr. Woods who does not currently meet the age requirement.
2019 Proxy Statement | ![]() | 55 |
The early retirement benefit under the pension plans consists of an annuity benefit that is undiscounted for retirement ages of 60 years or over, with a discount of 5 percent for each year under age 60. In addition, the Social Security offset is waived for annuity payments scheduled to be paid prior to age 62. Finally, theThe benefit is eligible to be paid in the form of a lump sum.
Early retirement benefits are in some cases more valuable than the present value of the executive’s earnedage-60 benefits. This is because the increase in lump sum value due to receiving benefits earlier and using a longer life expectancy are not fully offset, in the current interest rate environment, by the plan’s discount factor (5 percent per year) for early retirement annuities.
The table below shows the lump sum early retirement benefits under the plans for Messrs. SwigerChapman and AlbersWilliams as ofyear-end 2015. 2018. The lump sum early retirement benefits for Messrs. TillersonSwiger and DolanDuffin as ofyear-end 2015 2018 are the amounts shown in the Pension Benefits table.
Name | Plan Name | Lump Sum Early Retirement Benefit ($) | |||||||
| ExxonMobil Pension Plan | ||||||||
ExxonMobil Supplemental Pension Plan | |||||||||
ExxonMobil Additional Payments Plan | 1,873,967 3,869,109 7,182,174 | ||||||||
| ExxonMobil Pension Plan | ||||||||
ExxonMobil Supplemental Pension Plan | |||||||||
ExxonMobil Additional Payments Plan | 1,625,569 3,901,101 6,760,384 |
In the event of termination prior to early retirement eligibility, there is no benefit payable under the Supplemental Pension Plan or Additional Payments Plan, and thePlan. The pension benefit payable from the ExxonMobil Pension Plan is actuarially discounted.reduced and payable only as an annuity.
In the event of death after early retirement eligibility, the retirement benefit is payable to the participant’s beneficiary. Prior to early retirement eligibility, if a participant has at least 15 years of service, the actuarially determined present value of the benefit accrued prior to death is payable to the participant’s beneficiary. Under the qualified Pension Plan, if a participant has less than 15 years of service at the time of death, the survivor benefit, payable to the participant’s surviving spouse, is 50 percent of the actuarially discounted vested termination benefit payable under the qualified joint and survivor annuity option.
Nonqualified Deferred Compensation for 20152018
Name | Executive ($) | Registrant ($) | Aggregate Earnings in Last FY ($) | Aggregate ($) | Aggregate Balance at Last FYE ($) | Executive ($) | Registrant ($) | Aggregate Earnings in Last FY ($) | Aggregate ($) | Aggregate Balance at Last FYE ($) | |||||||||||||||||||||||||||||||||||
R.W. Tillerson | 0 | 194,740 | 55,232 | 74,711 | 1,981,903 | ||||||||||||||||||||||||||||||||||||||||
D.W. Woods | 0 | 33,017 | 5,874 | 0 | 226,598 | 0
| 78,750
| 14,293
|
| 0
|
|
| 452,431
|
| |||||||||||||||||||||||||||||||
A.P. Swiger | 0 | 67,463 | 20,171 | 20,098 | 729,958 | 0
| 78,452
| 35,006
|
| 0
|
|
| 1,036,786
|
| |||||||||||||||||||||||||||||||
M.W. Albers | 0 | 67,725 | 15,835 | 21,351 | 579,737 | ||||||||||||||||||||||||||||||||||||||||
M.J. Dolan | 0 | 74,025 | 22,466 | 23,931 | 810,870 | ||||||||||||||||||||||||||||||||||||||||
N.A. Chapman
| 0
| 39,060
| 10,899
|
| 0
|
|
| 334,518
|
| ||||||||||||||||||||||||||||||||||||
J.P. Williams, Jr.
| 0
| 45,792
| 11,550
|
| 12,824
|
|
| 345,391
|
| ||||||||||||||||||||||||||||||||||||
N.W. Duffin
| 0
| 58,240
| 19,969
|
| 0
|
|
| 601,477
|
|
(1) | Represents a partial distribution of plan benefits for the payment of FICA taxes due. |
The table above shows the value of the Company credits under ExxonMobil’s nonqualified Supplemental Savings Plan. For a description of the nonqualified Supplemental Savings Plan, see page 44.
The nonqualified savings planSupplemental Savings Plan provides employees with the7-percent, Company-matching contribution to which they would otherwise be entitled under the qualified plan if not for limitations on covered compensation and total contributions under the U.S. Internal Revenue Code.
The rate at which the nonqualified savings planSupplemental Savings Plan account bears interest during the term of a participant’s employment is 120 percent of the long-term Applicable Federal Rate.
56 | ![]() | 2019 Proxy Statement |
The Company credits for 20152018 are also included in the Summary Compensation Table under the column labeled All Other Compensation. The aggregate balance at the last fiscal year end shown above includes amounts reported as Company contributions in the Summary Compensation Table of the current proxy statement and proxy statements from prior years as follows: $1,579,130 for Mr. Tillerson; $33,017$228,317 for Mr. Woods; $234,938$459,690 for Mr. Swiger; $292,250$39,060 for Mr. Albers; and $407,313Chapman; $45,792 for Mr. Dolan.Williams; and $113,768 for Mr. Duffin.
Administrative Services for Retired Employee Directors
The Company provides certain administrative support to retired employee directors,directors. These generally involving,involve, but are not limited to, assistance with correspondence and travel arrangements relatingrelated to activities the retired directors are involved with that continue from their employment, such as board positions with nonprofit organizations. Given the nature of the support provided, a retired director’s spouse may also benefit from the support provided.
It is not possible to estimate the future cost that may be incurred by the Company for providing these services to Mr. Woods, who is currently the only employee director.
Executives and their families are eligible to participate in the Company’s health care programs, including medical, dental, prescription drug, and vision care, on the same basis as all other U.S. employees. No special provisions apply.
U.S. salaried employees are entitled to payment of salary for any accumulated but unused vacation days at retirement or other termination of employment. Payment for unused vacation is included in final paymentspayment of earned salary, if applicable.
Termination and Change in Control
The Named Executive Officers are not entitled to any additional payments or benefits relating to termination of employment other than the retirement benefits previously described.
The Named Executive Officers do not have employment contracts, a severance program, or any benefits or payments triggered by a change in control.control, see page 48.
For more details on ExxonMobil’s clawback policy and forfeiture provisions, and clawback policy, see page 43.47.
Payments in the Event of Death
The only event that results in the acceleration of the vesting period for outstanding equityperformance share awards is death.
Also in the event of death, an executive’s estate or beneficiaries would be entitled to receive the applicable pension death benefits as described on page 54,55, a distribution of the executive’s savings plan balances, and payment of Company-provided life insurance or death benefits as described beginning on page 49.50. Atyear-end 2015, 2018, the amount of Company-provided life insurance for each Named Executive Officer is as follows:
Name | Life Insurance Benefit ($) | |||
| ||||
| | |||
A.P. Swiger | ||||
| ||||
| ||||
N.W. Duffin | 4,476,000 |
2019 Proxy Statement | ![]() | 57 |
We expect Items 4 through 1410 to be presented by shareholders at the annual meeting. Following SEC rules, other than minor formatting changes, we are reprinting the proposals and supporting statements as they were submitted to us. We take no responsibility for them. Upon oral or written request to the Secretary at the address listed under Contact Information on page 4,7, we will provide information about the sponsors’ shareholdings, as well as the names, addresses, and shareholdings of anyco-sponsors.
The Board recommends you vote AGAINST Items 4 through 1410 for the reasons we give after each one.
ITEMItem 4 – INDEPENDENT CHAIRMANIndependent Chairman
This proposal was submitted by the Ellen M. Higgins Trust 1959,The Kestrel Foundation, 111 Commercial Street, Suite 302, Portland, ME 04101, the beneficial holder of 150 shares.320 shares and lead proponent of a filing group.
“RESOLVED:RESOLVEDThat the: The shareholders request the Board of Directors of ExxonMobil to adopt as policy, and amend the bylaws as necessary, to require the Chair of the Board of Directors, whenever possible, to be an independent member of the Board. This policy shouldwould be phased in for the next CEO transition.
If the Board determines that a Chair who was independent when selected is no longer independent, the Board shall select a new Chair who satisfies the requirements of the policy within a reasonable amount of time. Compliance with this policy is waived if no independent director is available and willing to serve as Chair.
SUPPORTING STATEMENT:Supporting Statement:
We believe:
The role of the CEO and management is to run the company;company.
The role of the Board of Directors is to provide independent oversight of management and the CEO;CEO.
There is a potential conflict of interest for a CEO to be her/his own overseer as Chair while managing the business.
ExxonMobil’sExxon Mobil’s CEO Rex Tillerson presentlyDarren Woods serves both as CEO and Chair of the Company’s Board of Directors. We believe the combination of these two roles in a single person weakens a corporation’s governance structure, which can harm shareholder value.structure.
Chairing and overseeing the Board is a time intensive responsibility, and aresponsibility. A separate independent Chair leavesalso frees the CEO free to manage the company and build effective business strategies.
As Andrew Grove, Intel’s former chair, Andrew Grove stated, ‘The separation of the two jobs goes to the heart of the conception of a corporation. Is a company a sandbox for the CEO, or is the CEO an employee?employee? If he’s an employee, he needs a boss, and that boss is the Board. The Chairman runs the Board. How can the CEO be his own boss?boss?’
In our view, shareholders are best served by a separate independent Board Chair who can provide a balance of power between the CEO and the Board. The primary duty of a Board of Directors is to oversee the management of a company on behalf of shareholders. A combined CEO / Chair creates a potential conflict of interest, resulting in excessive management influence on the Board and weaker oversight of management.
Numerous institutional investors recommend separation.separation of these two roles. For example, California’s Public Employee Retirement System CalPERS’System’s Principles & Guidelines encouragesencourage separation, even with a lead director in place.
Shareholder resolutions urging separationAccording to ISS ‘2017 Board Practices’, (March 2017), 58% of CEOS&P 1,500 firms separate these two positions and Chair averaged approximately 36%the number of votes in favor in 2014 and 30% in 2015,companies separating these roles is growing.
58 | ![]() | 2019 Proxy Statement |
With the unprecedented challenges facing global energy companies regarding climate change, as they make important transitions to a low carbon economy, it is an indication of strong investor support.
Many companies have separate and/or independent Chairs. By 2014, 46.4% of the S&P 500 companies had boards that were not chaired by their CEO. An independent Chairimportant time to ensure our company’s governance is the prevailing practice in the United Kingdom and many international markets.
An independent Chair and vigorous Boardbest it can improve focus on important ethical and governance matters, strengthen accountability to shareowners and help forge long-term business strategies that best serve the interests of shareholders, consumers, employees and the company.be.
This shareholder resolution to ExxonMobilExxon Mobil received 34%38.7% vote in favor last year.2018.
To foster a simplesimplify the transition, we propose this new policy, if enacted, would be phased in when Mr. Tillerson retires and thea next CEO is chosen.
We urge a vote FOR this resolution.”
The Board recommends you vote AGAINST this proposal for the following reasons:
The Board believesagrees with the importance of a strong, independent Board to represent the interests of shareholders, and that the decision as to who should serve as Chairman and/or CEOBoard is responsible for effective oversight of management, including the proper responsibility ofCEO; however, the Board. Directors possess considerable experience and understand the unique challenges and opportunities the Company faces, and are in the best position to evaluate the needs of the Company and how best to organize the capabilities of the directors and senior managers to meet those needs.
The Board carefully considers the pros and cons of separating ordoes not agree that combining the Chairman and CEO positions and whether the Chairmanship should be held by an independent director, whenever the circumstances require. The Board must retain the flexibilityimpedes its ability to determine the particular governance structure the Board believes will best serve the long-term interests of shareholders at the time and should not be compelled to takeprovide effective oversight or that it constitutes a particular position that may be contrary to its best judgment.conflict.
Empirical studies are inconclusive on the benefits of separatingIn fact, combining the Chairman and CEO roles and recent third-party research suggests cautionresults in adoptingsignificant benefits that an inflexible, one-size-fits-all approach, which may explain why the approach remains a distinct minority position among U.S. companies. According to the2015 Spencer Stuart Board Index, only 29 percent of S&P 500 companies have a truly independent chairman, and only 4 percent have a policy that mandates the separation of theChairman would not provide. A combined Chairman and CEO roles.position helps ensure the items of greatest importance for the business are brought to the attention of, and reviewed with, the Board on a timely basis. As new issues evolve within the business, the Chairman/CEO is positioned well, with deep company knowledge and industry experience, to raise those issues with the Board, ensuring appropriate oversight.
The Board is comprised entirely of independent directors, except the CEO and President.CEO. Each independent director has access to the CEO and other Company executives on request;request, may call meetings of the independent directors;directors, and may request agenda topics to be added or dealt with in more detail atfor meetings of the full Board or an appropriate Board committee.
At the present time, the Board believes that independent Board leadership is effectively provided by the Presiding Director, who:
Has the authority to call, chair, and determine the agenda for executive sessions of the non-employee directors and provideindependent directors;
Provides feedback to the Chairman;
Chairs Board meetings in the absence of the Chairman; and
In consultation with the Chairman, reviews schedules and approves agendas for Board meetings.
The Compensation Committee, comprised entirely of independent directors, reviews the CEO’sCEO performance and establishes his compensation, the result of which is reviewed with the full Board, absent the Chairman.
ITEM 5 – CLIMATE EXPERT ON BOARD
This proposal was submitted by the Province of St. Joseph of the Capuchin Order, 1015 North Ninth Street, Milwaukee, WI 53233, the beneficial owner of at least $2,000 in market value of the Company’s stock and lead proponent of a filing group.
“Climate change expertise at both management and board levels is critical to companies’ success in the energy industry because of significant environmental issues associated with their operations. These impact shareholders, lenders, host country governments and regulators, as well as affected communities. Companies’ ability to demonstrate policies and best practices reflecting internationally accepted environmental standards can lead either to successful business planning or difficulties in raising new capital and obtaining the necessary licenses from regulators.
We believe ExxonMobil’s Board of Directors would benefit by addressing the impact of climate change on its business at its most strategic level by electing to its Board independent specialists versed in all business aspects of climate change. Just one authoritative figure with acknowledged expertise and standing could perform a valuable role in ways that would enable the Board to more effectively address the environmental issues and risks inherent in its present business model regarding climate change. It would also help ensure that the highest levels of attention are focused on developing environmental standards for new projects. In comparison, banks which had inadequate expertise on their boards to deal with risks related to new financial instruments and transactions often paid a huge price with a major impact on shareholder value.
Since the Exxon Valdez incident, the public’s perception of ExxonMobil represents a company with questionable environmental practices. For years some shareholders concerned about ExxonMobil’s approach to climate change have asked to engage directly with members of its Board; consistently they have been denied this access to dialogue on matters of critical concern regarding climate change.
RESOLVED, shareholders request that, as elected board directors’ terms of office expire, the Exxon Mobil Corporation’s Board’s Nominating Committee nominate for Board election at least one candidate who:
* a director shall not be considered ‘independent’ if, during the last three years, she or he –
The Board recommends you vote AGAINST this proposal forbelieves it is important to preserve its flexibility in choosing the following reasons:leadership structure that will best serve the long-term interests of shareholders. The Board carefully considers the merits of separating or combining the Chairman and CEO positions, and whether the Chairmanship should be held by an independent director, whenever a CEO change occurs.
ExxonMobil’s current process, as reflected in itsTheGuidelines for the Selection2018 Spencer Stuart Board Index notes that less thanone-third of Non-Employee Directors, requires director candidates toS&P 500 boards have a breadthtruly independent chairman that meets the NYSE rules for independence. As such, our Company’s leadership structure is consistent with the prevailing practice of experience and demonstrated expertise in managing large relatively complex organizations and be accustomed to dealing with complex situations with worldwide scope.
The Board must possess the capabilities to address the full range of business risks, from financial to social to environmental, including climate risk. In doing so, the Board leverages subject matter experts, both internally and externally, to share the latest science, analysis, and insights.
Because each director must possess a breadth of expertise and experience, setting aside a seat for an environmental specialist or other single-issue candidate who lacks other important attributes would, in our view, not becap companies in the best interests of the Company or its shareholders because it would dilute the breadth needed by all directors to make informed decisions for the Company. Board members have fiduciary duties to the Company’s shareholders which require them to be informed on multiple issues and work together with other Board members to make decisions on a collaborative basis.
The Board is comprised of members with the credentials, proficiencies, and experience that enable the Board to effectively address climate-related issues. Board members hold nine science and engineering degrees and have relevant experience and leadership in a range of environmental matters, such as water, alternative energies, energy conservation, global climate issue management, and environmental innovation. Further, the Board has access to environmental and climate expertise via periodic briefings by Company professionals whose primary expertise is in the area of environmental management and stewardship. This includes sharing external perspectives on the status of science, research and development, and public policy.
The Company’s core value to ‘Protect Tomorrow, Today’ serves as a foundation for sound environmental management. OurOperations Integrity Management System is an effective and proven framework that aligns our environmental priorities with our business objectives, and has brought about improved environmental performance for many years.United States.
ITEM 6 — HIRE AN INVESTMENT BANKItem 5 – Special Shareholder Meetings
This proposal was submitted by Kenneth Steiner, 14 Stoner Ave., 2M, Great Neck, NY 11021, the beneficial owner of 500 shares.
“[XOM: Rule 14a-8 Proposal December 30, 2015]5 – Special Shareholder Meeting
Proposal [6] – Hire an investment bank
Shareholders recommendResolved, Shareowners ask our company hire an investment bankboard to exploretake the salesteps necessary (unilaterally if possible) to amend our bylaws and each appropriate governing document to give holders in the aggregate of 10% of our company.outstanding common stock the
2019 Proxy Statement | ![]() | 59 |
power to call a special shareowner meeting (or the closest percentage to 10% according to state law) without the current requirement to petition a court in order to do so. This would includeproposal does not impact our board’s current power to call a sale by dividing the company into major piecesspecial meeting.
Exxon Mobil is in a small minority of companies that require shareholders to facilitatego to court in order to call for a special shareholder meeting. Plus Exxon Mobil may have an unlimited budget to oppose such a sale.request in court and shareholders do not have such a budget.
I believeSpecial meetings allow shareowners to vote on important matters, such as electing new directors that can arise between annual meetings. This proposal topic won more than 70%-support at Edwards Lifesciences and SunEdison in 2013. This 70%-support would have been higher if all shareholders had access to independent proxy voting advice.
A shareholder ability to call a special meeting would put shareholders in a better position to give continuing input on improving the salemakeup of XOM would release significantlyour board of directors. This topic is more valueimportance since we do not have any oversight of our CEO by an independent Board Chairman.
Mark Zuckerberg, Jeff Immelt and Elon Musk are examples of problems with concentrating too much power in one person. Darren Woods, our CEO/Chairman received the highest negative votes of any Exxon Mobil director in 2018. And Exxon Mobil executive pay received only a 73%-vote in 2018 compared to 90% and 95% votes at many companies.
Plus we apparently do not have a Lead Director as this title does not even appear in our 2018 proxy. Meanwhile in the5-years leading up to the submittal of this proposal our stock fell from $101 to $77.
Also our right to shareholder proxy access may be unreachable because it can only be used by 20 shareholders thanwho have owned a total of $30 billion of Exxon Mobil stock continuously for3-years. If a group of 20 shareholders needs one more shareholder to meet this enormous $30 billion requirement – the current share price. Our stock was trading above $100 in 2014 and it went below $75 in 2015.group is totally out of luck.
Please vote yes:
Hire an investment bankSpecial Shareholder Meeting – Proposal [6]5”
The Board recommends you vote AGAINST this proposal for the following reasons:
The Board believes it is important that shareholders have a meaningful right to call special shareholder meetings, a right that ExxonMobil pursues business strategiescurrently provides. A special meeting of ExxonMobil shareholders may be called by holders of not less than 10 percent of outstanding shares, in accordance with New Jersey law, upon a showing of good cause.
By requiring a showing of good cause to call a special meeting, New Jersey law, applicable to our Company, effectively balances the interests of all shareholders. By allowing shareholders of at least 10 percent of outstanding common stock to call a meeting for an appropriate purpose, all shareholders are protected against the potential risk that maximize long-terma minority shareholder value. The Company also manages its assetsgroup abuses this right for an illegitimate objective. If, after engagement with shareholders, the Board of Directors agrees that a special meeting is needed, then a meeting could be scheduled by the Board without the need for a court review.
Shareholder interests are protected by a strong, independent Board that is responsible for the effective oversight of management, including the CEO. Effective leadership is further provided by the independent Presiding Director who holds the authority to call, chair, and business segments with a focus on profitability to ensure that acceptable financial performance is achieved. This asset management discipline includes consideringdetermine the saleagenda for executive sessions of assets or businesses when such divestments yield the highest value for shareholders. This financial discipline has ledindependent directors; provide feedback to the sale of over $45 billion of assets and businesses overChairman; chair Board meetings in the past 10 years.
On an ongoing basis, ExxonMobil considers a wide range of strategies and business structures, as a fundamental responsibilityabsence of the Corporation’s management.Chairman; and in consultation with the Chairman, review schedules and agendas for Board meetings.
SinceShareholders recognized the Exxon-Mobil merger, the Company has returned $357 billion to shareholders through dividendsstrength, leadership, and share purchases, which is greater than the market capitalization of 496overwhelming independence of the S&P 500 companies. This has been doneExxonMobil Board by providing voting support of more than 95 percent for all ExxonMobil directors in 2018.
60 | ![]() | 2019 Proxy Statement |
Many companies that provide shareholders the right to call a sustainable manner without having to dismantlespecial shareholder meeting do so at a higher share threshold, often 20 percent or higher. As such, the Company or undermine its business model,10 percent threshold coupled with the good cause requirement provides a meaningful and has rewarded long-term shareholders with returns in excess of the S&P 500.balanced shareholder right. The Board believes this proposal is, therefore, unnecessary.
ITEM 7Item 6 – PROXY ACCESS BYLAWBoard Matrix
This proposal was submitted by the New York City Employees’ Retirement System, the New York City Fire Department Pension Fund, the New York City Teachers’ Retirement System, the New York City Police Pension Fund,
and the New York City Board of Education Retirement System (the “Systems”), OneSystems, 1 Centre Street, Room 629,8th Floor North, New York, NY 10007, the beneficial ownersholder of 7,168,3175,817,212 shares.
“RESOLVED:RESOLVED: Shareholders of Exxon Mobil Corporation (the ‘Company’(‘Exxon’) ask the boardrequest that its Board of directorsDirectors (the ‘Board’) disclose to takeshareholders each director’s/nominee’s gender and race/ethnicity, as well as skills, experiences and attributes that are most relevant in light of Exxon’s overall business, long-term strategy and risks, presented in a matrix form. The requested matrix shall not include any attributes the steps necessary to adopt a ‘proxy access’ bylaw. Such a bylaw shall require the Company to includeBoard identifies as minimum qualifications for all Board candidates in proxy materials prepared for a shareholder meeting at which directors are to be elected the name, Disclosure and Statement (as defined herein) of any person nominated for election to the board by a shareholder or group (the ‘Nominator’) that meets the criteria established below. The Company shall allow shareholders to vote on such nominee on the Company’s proxy card.compliance with SEC RegulationS-K.
The number of shareholder-nominated candidates appearingrequested matrix shall be presented to shareholders in Exxon’s annual proxy materials shall not exceed one quarterstatement and on its website within six months of the directors then serving. This bylaw, which shall supplement existing rights under Company bylaws, should provide that a Nominator must:
The Nominator may submit with the Disclosure a statement not exceeding 500 words in support of each nominee (the ‘Statement’). The Board shall adopt procedures for promptly resolving disputes over whether notice of a nomination was timely, whether the Disclosureannual meeting, and Statement satisfy the bylaw and applicable federal regulations, and the priority to be given to multiple nominations exceeding the one-quarter limit.updated annually.
SUPPORTING STATEMENT
We believe proxy accessa diverse board – in terms of relevant skills and experience AND gender and race/ethnicity – is a fundamental shareholder right that will make directors more accountablegood indicator of a well-functioning board. Diverse boards can better manage risk by avoiding ‘groupthink’ – a cognitive bias whereby ‘homogenous, cohesive groups’ tend toward standard agreement with known business associates and enhance shareholder value. A 2014 CFA Institute study concluded that proxy access would ‘benefit both the markets and corporate boardrooms, with little cost or disruption’ and could raise overall US market capitalization by up to $140.3 billion if adopted market-wide.not challenge ‘basic premises’ (http://www.cfapubs.org/doi/pdf/10.2469/ccb.v2014.n9.1www.ieoimf.org/ieo/files/completedevaluations/01102011Crisis_IV._Why_ Did_the_IMF_Fail_to_Give_Clear_Warning.pdf).
The proposed terms are similar to those in vacated SEC Rule 14a-11McKinsey research suggests that companies with greater gender and ethnic board diversity have stronger financial performance (https://www.mckinsey.com/business-functions/organization/our-insights/why-diversity-matters). MSCI research suggests that gender diverse boards have fewer instances of bribery, corruption, and fraud (https://www.sec.gov/rules/final/2010/33-9136.pdfwww.msci.com/documents/10199/04b6f646-d638-4878-9c61-4eb91748a82b). The SEC, following extensive analysis
Many directors recognize the importance of, and input from companiesmany boards disclose information on, gender and investors, determined that those terms struckracial/ethnic diversity on boards:
• | According to a 2017 PwC survey of 886 directors, 68% believe gender diversity is very important and 42% believe racial diversity is very important. Among those who responded that diversity is important, 82% said it improved board performance and 59% said it improved company performance. (https://www.pwc.com/us/en/governance-insights-center/annual-corporate-directors-survey/assets/pwc-2017-annual-corporate--directors--survey.pdf) |
• | According to a 2017 Equilar study of 500 large companies, 45.1% disclosed board composition by gender and 39.8% disclosed composition by race or ethnicity. (http://semlerbrossy.com/wp-content/uploads/Equilar-Board-Composition-and-Director-Recruiting-Trends-SEP-2017.pdf) |
In its 2018 proxy statement, Exxon fails to disclose individual directors’ individual qualifications in a matrix format, to provide an overview of how the proper balance of providing shareholders with a viable proxy access right while containing appropriate safeguards.board effectively fulfills its oversight responsibilities in the aggregate.
A similar proposal received 49.40%Board matrix will give Exxon shareholders a‘big-picture’ view of votes cast atnominees’ attributes, both individually and collectively, and how they fit together, thereby enabling shareholders to (a) assess how well-suited individual director nominees are for the Company’scompany in light of (i) the company’s evolving business strategy and risks and (ii) the overall mix of skills and experiences; (b) identify any gaps in skills, experience or other characteristics; and (c) make better informed proxy voting decisions.
Using a matrix to present director qualifications is recommended by the National Association of Corporate Directors (https://www.nacdonline.org/Resources/Article.cfm?ItemNumber=35337), among other groups. The EY Center for Board Matters reported that 29% of S&P 500 companies disclosed a director skills matrix in 2018 (https://www.ey.com/Publication/vwLUAssets/EY-cbm-proxy-season-review-2018/$FILE/EY-cbm-proxy-season-review-2018.pdf).
2019 Proxy Statement | ![]() | 61 |
The matrix approach that we request is consistent with the request in a March 2015 annual meetingrulemaking petition to the Securities and similar bylaws have been adoptedExchange Commission seeking mandatory matrix disclosure by more than 80 companies.all U.S. public companies (https://www.sec.gov/rules/petitions/2015/petn4-682.pdf).
We urge shareholders to vote FOR this proposal.”
The Board recommends you vote AGAINST this proposal for the following reasons:
The Board agrees that diversity is a key attribute of a well-functioning board, and is important information for shareholders. This is one of the reasons we provide detailed information regarding our Board in our proxy statement and on our website.
After conferring with the underlying objectiveproponent, we supplemented this year’s proxy statement with several enhancements, including: a detailed matrix allowing shareholders to easily judge the collective competencies of maintainingthe Board; clarity between Board qualifications and the competencies sought for director candidates; descriptions of the relevance of each competency to ExxonMobil’s business; infographics related to gender, race/ethnicity, and age diversity; and relevant competencies shown in each director biography. This adds to the data traditionally provided, including lists of the qualifications and competencies sought by the Board and a highly qualifieddetailed description of how diversity fits into the candidate search process.
The board refreshment process is a key function of the Board and a priority of the Board Affairs Committee. This committee engages an independent Boardexecutive search firm to help identify new director candidates, and also considers recommendations made by accessing a broad poolemployee directors, shareholders, and others. All recommendations are evaluated against the Board’s Guidelines for Selection of candidates who haveNon-Employee Directors; these guidelines are available onexxonmobil.com and summarized in our proxy statement.
Diversity of experiences and capabilities thatbackgrounds are complementary toimportant considerations in identifying and assessing Board candidates. The success of our refreshment program is clearly evident in the scope and complexity of the Company’s business. While the Board is fully aligned with the underlying objective, it believes that the long proven processes currently in place provide a more effective outcome than what is being proposed by the proponents and that the proposal presents potential risks to the Company and its shareholders.
The Board takes its duty as a fiduciary of the Company seriously and has processes in place to ensure that all shareholder interests are well represented. Twelve out of the fourteen Board nominees are independent and have
been selected based upon Board-adopted, published guidelines and processes that are intended to yield a Board comprised of the most highly qualified business and professional leaders. The high voter tallies that our directors receive year-on-year suggest that shareholders are pleased with the qualityresults. Female members comprise 30 percent of our Board, members and demonstratewell above the effectivenessS&P 500 average of 24 percent (2018 Spencer Stuart Board Index). The Board’s minority representation of 20 percent also exceeds the average of the established processes.top 200 S&P 500 companies (2018 Spencer Stuart Board Index). Four of the last seven most recently elected independent directors were women or race/ethnic minorities. Our Board also enjoys significant shareholder support, with votes on average ranging well into the mid90-percentile over the past 10 years.
The proposal risks undercuttingimposition of a prescriptive matrix by individual director can promote acheck-the-box approach to refreshment, thus increasing the critical rolerisk of bypassing a well-qualified candidate, and may mislead shareholders into wrongly believing that the independent Board Affairs Committee plays in ensuring that, through well-established, rigorous processes,only a subset of directors contribute to particular decisions or represent the Board is comprised of personnel with required skills, backgrounds and competencies. Introducing a novel selection process, as the proposal seeks to do, risks diminishing the caliber and effectiveness ofon particular matters. Instead, the Board over time and the ability of the Company to attract the kinds of leaders to its Board that shareholders have come to expect. Furthermore, directors who recommend candidates for election each year under these processes do so withacts as a legal duty to all shareholders and act in the best interests of the Company. It is unclear what duty applies to the selection of proxy candidates under the proposal.
The proposal additionally risks introducing non-constructive and destabilizing dynamics into the Board election process. Some whom the Company has spoken with as result of its expansive engagement with shareholders on the issue say that a nomination under proxy access does not necessarily mean that the candidate will be elected. However, there is little experience in the United States with how proxy access will work, and the practice here may vary considerably from other jurisdictions where proxy access currently exists. At a minimum, the process may result in a proxy contest, which history suggests can be costly, fractious, distracting, and lead to results that are not in the best interests of the Company or its shareholders. Further, we do not believe that there is any meaningful evidence that proxy access would improve corporate governance or enhance market capitalization.
Perhaps most concerning is the potential risk for the proposal to increase the influence of special interest groups and lead to single-issue participants on the Board. The Board believes that directors should represent all of the Company’s shareholders, not just those who propose them for election. The proposal, however well intentioned, may be misused by shareholder groups to address various single issues that individually or collectively could undermine a business model that has long servedcollective body, representing the interests of all shareholders. While individual directors leverage their experience and knowledge, Board decisions and perspectives reflect the collective wisdom of the group. The breadth of our shareholders well. The potential for a seriesdisclosures, including the enhancements mentioned above, emphasizes the collective strength of directors who rotate from one single issue to another can also undermine the long-term focus the Company seeks to foster in its management and Board, consistent with its business strategy and required investment horizons.
It is also important to reinforce that shareholders already have an important role in determining who is on the Board. Directors are required to stand for election each year and shareholders can evidence their support or concern regarding individual Board members by vote during the annual shareholders meeting, and the Company has a stringent resignation policy required of any director who fails to receive a majority of “for” votes. Also, shareholders have the right to suggest non-employee Board candidates for consideration, and these suggestions are considered in the same manner as other candidate recommendations, whether from Board members, the Board Affairs Committee’s independent search firm, or from other sources. Through the Company’s ongoing engagement process, shareholders also have an opportunity to share their views and to influence Company policies and approaches.
ExxonMobil has demonstrated a track record of engagement with and responsiveness to shareholders, established strongour Board and governance practices, and continues to maintain long-term industry-leading returns for our shareholders. Our current governance practices provide strong Board accountability and important shareholder rights. We believe that instead of strengthening our existing practices,meaningfully addresses the proposal could undermine the rigorous and effective processes we have in place.
Through the Company’s ongoing engagement with shareholders this past year, the Board has heard a broad range of views regarding this proposal. The Board appreciates all shareholder views on the matter, and while it continues to consider the merits of the proposal in light of the Company’s ongoing engagement, it believes, for the reasons discussed above, that the proposal is not in the best interests of the Company at this time.
ITEM 8Item 7 – REPORT ON COMPENSATION FOR WOMENClimate Change Board Committee
This proposal was submitted by Eve S. Sprunt, PhD, 3753 Oakhurst Way, Dublin, CA 94568,Adam Seitchik, a client of Arjuna Capital, 1 Elm Street, Manchester, MA 01944, the beneficial owner of at least $2,00042 shares.
“RESOLVED: Shareholders request the Board of Directors charter a new Board Committee on Climate Change to evaluate Exxon Mobil’s strategic vision and responses to climate change, and better inform Board decision making on climate issues. The charter should explicitly require the committee to engage in market valueformal review and oversight of corporate strategy, above and beyond matters of legal compliance, to assess the Company’s stock.company’s responses to climate related risks and opportunities, including the potential impacts of climate change on business, strategy, financial planning, and the environment.
“RESOLVED, that to improve transparency regarding compensation earned by female employees relative
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Supporting Statement:The proponent believes an independent committee would better provide focused fiduciary oversight of climate related risks and opportunities and should include board members with climate change expertise in areas such as policy, carbon pricing, renewable energy, adaptation, and climate science.
WHEREAS: Major oil companies face unprecedented disruption to their male peers, ExxonMobil will annually reportbusiness driven by global imperatives to shareholders the percentagelimit global warming and competition fromnon-carbon-emitting technologies. The Intergovernmental Panel on Climate Change projects dramatic drops in industry emissions of female employees in each50 to 90 percent by 2050 are necessary to limit global warming to between 1.5 and 2 degrees Celsius.
Board oversight of ten
equally-sized fractions of its workforce by total compensation, namely, the lowest 10% by total compensationclimate change strategy and so on, continuing with each increasingly compensated group, up through the tenth and final group that includes the 10% of employees who receive the highest total compensation.
STATEMENT OF SUPPORT
Women on average in the United States still earn less than 79% of what men earn and often face more barriers to advancement than their male counterparts. Greater transparency concerning compensationplanning is essential to identifyingaddress the existential threat of climate change to the fossil fuel industry and eliminating remaining obstaclesour Company. 84 percent of companies in the energy sector have adopted some level of board oversight of climate change, but only 6 percent provide board incentives (monetary andnon-monetary) for managing this critical threat, the lowest of all industries.
Effective governance of climate change risk, opportunity, adaptation and transition is essential to the long term success of Exxon. Investors believe a commitment to good climate change governance should be formalized in the board charter.
As fiduciaries, our Board is responsible for stewardship of business performance and long term strategic plans, while reviewing specific risk factors like developments in climate science and policy. Evidence from other companies demonstrates that impede progress towards gender pay equity.committee charter language helps define the scope of fiduciary duties of board members.
Publicly held companies are requiredCurrently, there is no specialized committee to report sensitive financial information sohelp the Board carry out its responsibility for Climate Change oversight like there is for the Audit, Board Affairs, Compensation, Public Issues and Contributions, and Finance Committees, despite the existential nature of climate change for our Company.
Exxon has stated that stockholders are appropriately informed. Since employees play‘climate risk oversight ultimately is the responsibility of the Board of Directors,’ yet climate appears a critical roletangential focus of the full board, as it is among approximately 17 other duties. And despite reporting that the Public Issues and Contributions Committee assists in oversight of climate risk, the committee’s charter does not list climate change among its approximately 6 other duties.
A failure to adequately plan for a low carbon transition, including climate change policy, competition from renewables, peak oil demand, and unburnable fossil fuel reserves, may place investor capital at substantial risk. It vital that our Company formalize board level oversight of climate change strategy to remain successful in an increasingly decarbonizing economy.”
The Board recommends you vote AGAINST this proposal for the following reasons:
The Board agrees that oversight of risks and the Company’s strategic direction is an important aspect of ExxonMobil’s enterprise risk management, and that effective risk management is essential to the long-term success of the Company.
The Board is responsible for the oversight of all Company risks, including climate-related risks. As part of a well-established process, the Board routinely reviews environmental stewardship through briefings on scientific and technical research, public policy positions and analysis, and Company initiatives and actions. The Board recognizes that the risk of climate change has the potential to manifest itself in a company’s success and women arenumber of ways. The risk of changing demand for ExxonMobil’s products for any reason, including climate, technology, or economic conditions, is considered a large percentagekey risk, which is managed by the full Board.
To understand the potential corporate impact of the workforce,a specific risk factor, it is important to understand the interactions and interdependencies with other risk drivers. As such, the Board believes it is important to evaluate specific risks in the context of all relevant risk. Annually, through its review of theOutlook for stockholdersEnergy, areas of research and development and the Company’s strategies and business plans, the Board assesses the Company’s management of, and response to, external risk factors. As part of its careful consideration of climate-related risks and opportunities, for the last decade at least one session of the full Board each year is dedicated to climate issues, with the Board engaging Company subject matter experts on the latest developments in climate science and policy.
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In addition, the Board relies on committees to provide additional insight on the risks faced by the Company. For example, the Board Audit Committee assesses ExxonMobil’s overall risk management approach and structure to ensure that enterprise-level risks are being appropriately considered by the Board. The Public Issues and Contributions Committee (“PICC”) regularly reviews ExxonMobil’s safety, health, and environmental performance, including steps taken to identify and manage climate-related risks and opportunities, and informs the Board on such matters.
The PICC, in conjunction with the Audit Committee, assists the Board in regularly considering climate-related risks, including the potential employeesimpacts on business, strategy, financial planning, and the environment, in a multitude of settings. These include: during the annual corporate planning process; during technology reviews; when reviewing current events; during shareholder engagements; when assessing Company performance; during annual visits to operating sites; and in reviews of publications like theEnergy & Carbon Summary andOutlook for Energy; and regulatory filings like the SEC Form10-K.
Accordingly, the Board believes that the PICC, and the Audit Committee in its review of the risk management framework, are better structured to assess the risks of climate change and make recommendations to the Board than a new committee created solely for this purpose.
Thus, while we agree that effective governance and oversight of climate issues are critical to long-term success, given the already-established review process, as well as the broad oversight currently provided by the PICC, the Audit Committee, and the full Board, the Board is confident that this matter is appropriately addressed.
Item 8 – Report on Risks of Gulf Coast Petrochemical Investments
This proposal was submitted by Andrew Behar, a client of As You Sow, 1611 Telegraph Avenue, Suite 1450, Oakland, CA 94612, the beneficial owner 40 shares.
“RESOLVED: Shareholders request that ExxonMobil, with board oversight, publish a report, omitting proprietary information and prepared at reasonable cost, assessing the public health risks of expanding petrochemical operations and investments in areas increasingly prone to climate change-induced storms, flooding, and sea level rise.
Supporting Statement: Investors request the company assess, among other related issues at management and Board discretion: The adequacy of measures the company is employing to prevent public health impacts from associated chemical releases.
WHEREAS: Investors are concerned about the financial, health, environmental, and reputational risks associated with operating andbuilding-out new chemical plants and related infrastructure in Gulf Coast locations increasingly prone to catastrophic storms and flooding associated with climate change. Civil society groups have accessmobilized to financial information that documents how well women are succeeding relativeoppose the expansion of petrochemical facilities in their communities due to concerns regarding direct impacts to their male counterparts.health and livelihoods from unintentional air and water pollutant releases. Such opposition threatens to jeopardize ExxonMobil’s social license to operate in the region.
Petrochemical facilities like ethane crackers and polyethylene processing plants produce dangerous pollutants including benzene (a known carcinogen), Volatile Organic Compounds, and sulfur dioxide. These operations can become inundated and pose severe chemical release risks during extreme weather events. Flooding from Hurricane Harvey in 2017 resulted in ExxonMobil shouldplant shut downs and the release of unpermitted, unsafe levels of pollutants. Nearby Houston residents reported respiratory and skin problems following ExxonMobil’s releases during Hurricane Harvey.
Growing storms and the costs they bring our company are predicted to increase in frequency and intensity as global warming escalates. Flood-related damage is projected to be proud to release the information on women’s compensation relative to men’s. Annual reports would show how women rank, and over time would reveal the effectivenesshighest in Texas, where many of ExxonMobil’s programspetrochemical plants are concentrated. Houston alone has seen three500-year floods in providing equal opportunitiesthe span of three years. Hurricane Harvey contributed to decreased earnings of approximately $40 million for women. IfExxonMobil in 2017.
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Historically, releases from ExxonMobil’s petrochemical operations have exceeded legal limits, exposing the requested data revealcompany to liability and millions in payment for violations of environmental laws including the Clean Air and Clean Water Acts. As climate change intensifies flooding and storm strength, the potential for unplanned chemical releases grows. Investors are concerned that ExxonMobil rankshas not adequately demonstrated how it will prevent such unsafe chemical releases.
In spite of these risks, Exxon has accelerated its petrochemical activity in the Gulf Coast, investing heavily in further expansion in flood-prone areas of Texas and Louisiana. The company has generally disclosed that risks from storms may impact its business and that extreme storms are among the best employers for women, this would improvefactors considered in its Operations Integrity Management System. The impacts to Exxon’s operations from Hurricane Harvey, however, indicate the corporation’s competitive positioncompany’s level of preparedness was insufficient. While the Company rapidly expands its petrochemical assets in climate-impacted areas, its available disclosures do not provide investors adequate information to understand whether ExxonMobil is effectively assessing and managing the drastic increase in material public health and financial risks presented by enhancing attractionclimate-related storm impacts and retention of top female talent.sea level rise.”
The Board recommends you vote AGAINST this proposal for the following reasons:
ExxonMobil values diversity,invests only in petrochemical plants or other operations where the potential public health risk can be managed to safe and acceptable levels. Therefore, the report requested by the proponent is not necessary.
To meet society’s growing demand for our products, ExxonMobil must often work in remote and challenging environments all over the world, including gender,in flood-prone areas. Using a rigorous and has well-established processes that have allowedcomprehensive assessment process, we consider the full range of potential environmental, socioeconomic, and health risks associated with our operations before we begin a new development. This allows us to successfully advance women onestablish a global basis.
Within ExxonMobil, compensation, development and advancement are highly integrated. As an individual advances through various career stages, pay grade and total compensation will advance accordingly. The program compensates each individual at a level commensurate with individual performance, experience, and pay grade, independent of gender. This ensures alignment of compensation among employees with similar performance who are in jobs of similar scope and complexity.
Within this context, metrics that measure the progress in development and advancement of women are more meaningful.
ExxonMobil develops future leaders from within the Company worldwide, drawing upon our diverse employee population. We promote leadership opportunities for women and work to improve the gender balance within the Company through all aspectscomprehensive understanding of the employment relationship,potential impacts and develop measures to avoid, mitigate, or remedy them. This proven assessment approach is worked jointly with the communities in which we operate and in cooperation with the governments and agencies that provide oversight for permit application and approval processes.
ExxonMobil’sOperations Integrity Management System (“OIMS”) has proven effective at ensuring readiness for and resiliency to extreme weather conditions. Our facilities are designed, constructed, and operated consistent with industry standards to withstand a variety of extreme weather and environmental conditions. When considering physical risks such as flooding and storms, we use historical experience, with additional safety factors, to cover a range of uncertainties. We monitor and manage ongoing facility integrity, and maintain disaster preparedness, response, and business continuity plans.
Our scientists and engineers are considered experts and through their participation in industry groups, they advise and gather insights to inform and improve standards, which in turn are adopted to enhance ExxonMobil’s operations. ExxonMobil’s spill prevention program and related procedures are effective. We build layers of protection by requiring that equipment is inspected and maintained, operators are trained, and drills are conducted. We take a rigorous approach to assessing and managing the potential impacts of a spill on water or land, with a particular emphasis on risk management, operations integrity, and containment capabilities. If a spill does occur, we ensure a rapid, comprehensive response to minimize the impact on communities and the environment.
These detailed, well-practiced, and continuously evaluated emergency response plans, tailored to each facility, help ExxonMobil respond to unplanned events, including recruitment, training, advancementextreme weather. For example, we started response efforts to Hurricane Harvey before the storm even arrived, safely shutting down operations, and salary administration.
At multiple times during the year, management discusses efforts in the area of diversity talent development, which includes both stewardship of metricsquickly recovering after it passed. Our Baytown and a review of specific development plans. These reviews take place at multiple levels within the organization and include representatives of senior management.
Robust development processes and rigorous management reviews, scheduled throughout the year, allow us to advanceBeaumont refineries effectively minimized environmental impacts from our goal of drawing from the most diverse and most qualified pool of candidates for each position at each level within the organization.
TheCorporate Citizenship Report (CCR), published by the Company on an annual basis, includes detailed information on our workforce demographics and provides additional information on our comprehensive diversity and inclusion efforts.
Key headlines from the 2015CCR:
Our efforts benefit our operations and the communities where we operate. At Beaumont, ExxonMobil assisted in emergency storm recovery witharound-the-clock efforts to restore water service to the city by mobilizing a temporary pumping solution, providing numerous generators for critical storm water management systems, and providingin-kind donations of high-performing female employees. Notably, 29 percentlabor and key equipment exceeding an estimated $900,000. At Baytown, the Company donated 27,000 gallons of our early career stage executive employees worldwide are women.
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ExxonMobil reports onOIMS, process safety, and engineering.
We believe that a focus on all aspects of the development path supported by a consistently applied compensation program will continue to result in a strong and diverse pool of highly qualified talent. We view the metrics that are disclosedenvironmental performance at its facilities in ourCorporate CitizenshipSustainability Report to be more meaningful to shareholders as they better represent our development model.and other public statements and publications,available atexxonmobil.com.
ITEMItem 9 – REPORT ON LOBBYINGReport on Political Contributions
This proposal was submitted by United Steelworkers, Five Gateway Center, Pittsburgh, PA 15222,the Unitarian Universalist Association, 24 Farnsworth Street, Boston, MA 02210, the beneficial ownerowners of 11687 shares and lead proponent of a filing group.
“Whereas, we believe in full disclosure of our company’s direct and indirect lobbying activities and expenditures to assess whether our company’s lobbying is consistent with ExxonMobil’s expressed goals and in the best interest of shareholders.
Resolved, the: The shareholders of ExxonMobilExxon Mobil Corporation (‘Exxon’ or ‘Company’) hereby request that the preparation ofCompany prepare and semiannually update a report, updated annually, disclosing:
For purposes of this proposal, a ‘grassroots lobbying communication’ is a communication directed to the general public that (a) refers to specific legislation or regulation, (b) reflects a view on the legislation or regulation and (c) encourages the recipient of the communication to take action with respect to the legislation or regulation. ‘Indirect lobbying’ is lobbying engaged in by a trade association or other organization of which ExxonMobil is a member.
Both ‘direct and indirect lobbying’ and ‘grassroots lobbying communications’ include efforts at the local, state and federal levels.
The report shall be presented to the Audit Committee or other relevant oversight committeespertinent board of directors committee and posted on ExxonMobil’s website.the Company’s website, that discloses the Company’s:
(a) | Policies and procedures for making electoral contributions and expenditures with corporate funds (both direct and indirect), including the board’s role (if any) in that process; and |
(b) | Monetary andnon-monetary contributions or expenditures that could not be deducted as an ‘ordinary and necessary’ business expense under section 162(e)(1)(B) of the Internal Revenue Code, including (but not limited to) contributions or expenditures on behalf of candidates, parties, and committees and entities organized and operating under section 501(c)(4) of the Internal Revenue Code, as well as the portion of any dues or payments made to anytax-exempt organization (such as a trade association) used for an expenditure or contribution that, if made directly by the Company, would not be deductible under section 162(e)(1)(B) of the Internal Revenue Code. |
The report shall be made available within 12 months of the annual meeting and identify all recipients and the amount paid to each recipient from Company funds. This proposal does not encompass lobbying spending.
Supporting Statement
As long-term Exxon shareholders, we encouragesupport transparency and accountability in corporate electoral spending. Disclosure is in the best interest of the Company and its shareholders. The Supreme Court recognized this in its 2010 Citizens United decision, which said: ‘[D]isclosure permits citizens and shareholders to react to the speech of corporate entities in a proper way. This transparency enables the electorate to make informed decisions and give proper weight to different speakers and messages.’
Publicly available records show Exxon has contributed at least $11,500,000 in corporate funds since the 2010 election cycle. (CQMoneyLine:http://moneyline.cq.com; National Institute on Money in State Politics:http://www.followthemoney.org).
We acknowledge that Exxon publicly discloses a policy on corporate political spending and its direct contributions to candidates, parties, and committees. However, we believe this is insufficient because Exxon does not disclose the following:
A full list of trade associations to which it belongs and thenon-deductible portions under section 162(e)(1)(B) of the dues paid to each; and
Payments to any other third-party organization, including those organized under section 501(c)(4) of the Internal Revenue Code, that could be used for election-related purposes.
Information on indirect electoral spending through trade associations and 501(c)(4) groups cannot be obtained by shareholders unless the Company discloses it. This proposal asks the Company to disclose all of its electoral spending, both direct and indirect. This would bring our company in line with a growing number of leading companies, includingConocoPhillips,Noble Energy, Inc., andSempra Energy, which present this information on their websites. Exxon’s Board and shareholders need comprehensive disclosure to be able to fully evaluate the use of corporate assets in elections. We urge your support FOR this critical governance reform.”
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The Board recommends you vote AGAINST this proposal for the following reasons:
The Company believes disclosure requirements outlined by federal and state laws are adequate. In addition, they are equitable as they require the same level of disclosure from all participants in the political process.
The Board agrees with the proponent that making political contributions and expenditures with corporate funds is a legitimate corporate activity. ExxonMobil, like many labor unions, companies, and other entities, engages in the political process by providing financial support to candidates and political organizations, that understand the necessity of fair and balanced public policy. Corporate political contributions are subject to a strict internal review process that requires them to be approved by the Chairman under the Company’sPolitical Activities Guidelines, available on our corporate website. Procedures are routinely verified during internal audits of the Corporation’s political activities. The political contributions of the Corporation, as well as the contributions of the political action committees established by the Corporation, are reviewed annually with the Board of Directors.
ExxonMobil complies fully with all relevant political spending disclosure laws, and also self-discloses multi-year political contributions to candidates and political organizations in the Political Contributions and Lobbying section ofexxonmobil.com. Additional relevant information is found in ExxonMobil’sSustainability Report, and websites for federal and state regulatory agencies, and the United States Congress. In addition, political contributions made by the Exxon Mobil Corporation Political Action Committee are reported monthly to the Federal Election Commission, and are a matter of public record atwww.fec.gov.
To the extent the proponent believes that current law requires inadequate disclosure from all parties, we believe that the U.S. Congress, Executive Branch, and state and local governments are the appropriate recipients of the proponent’s specific positions on political contribution disclosure laws and any reforms they seek. ExxonMobil should not be held to a different standard than other groups.
With the reporting and detail currently provided, the report requested by this proposal is not necessary.
This proposal was submitted by United Steelworkers, 60 Boulevard of the Allies, Pittsburgh, PA 15222, the beneficial owner of 116 shares and lead proponent of a filing group.
“Whereas, we believe in full disclosure of ExxonMobil’s direct and indirect lobbying activities and expenditures to assess whether ExxonMobil’s lobbying is consistent with its expressed goals and in the best interests of shareholders.
Resolved, the shareholders of ExxonMobil request the preparation of a report, updated annually, disclosing:
1. | Company policy and procedures governing lobbying, both direct and indirect, and grassroots lobbying communications. |
2. | Payments by ExxonMobil used for (a) direct or indirect lobbying or (b) grassroots lobbying communications, in each case including the amount of the payment and the recipient. |
3. | Description of management’s and the Board’s decision making process and oversight for making payments described above. |
For purposes of this proposal, a ‘grassroots lobbying communication’ is a communication directed to the general public that (a) refers to specific legislation or regulation, (b) reflects a view on the legislation or regulation and (c) encourages the recipient of the communication to take action with respect to the legislation or regulation. ‘Indirect lobbying’ is lobbying engaged in by a trade association or other organization of which ExxonMobil is a member.
Both ‘direct and indirect lobbying’ and ‘grassroots lobbying communications’ include efforts at the local, state and federal levels.
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The report shall be presented to the Audit Committee or other relevant oversight committees and posted on ExxonMobil’s website.
Supporting Statement
We encourage transparency in ExxonMobil’s use of corporate funds to influence legislation and regulation.lobby. ExxonMobil spent $26.07$99.43 million in 2013 and 2014from 2010 – 2017 on federal lobbying (opensecrets.org).lobbying. These figures do not include state lobbying expenditures, to influence legislation in states, where ExxonMobil also lobbies but disclosure is uneven or absent. For example, ExxonMobil spent $699,362$3,860,715 on lobbying in California from 2010 – 2017. Exxon also lobbies abroad, reportedly spending between€3.75m and€4m on lobbying in Brussels for 2014 (http://cal-access.ss.ca.gov/).2017 (‘Revealed: ExxonMobil’s lobbying on climate change has attracted media attentionPrivate Dinner with Cyprus’ Top EU Brass,’EU Observer, August 12, 2018).
We commend ExxonMobil for ending its membership in the American Legislative Exchange Council (‘Exxon Knew about Climate Change Decades Ago, Spent $30MMobil Joins Exodus of Firms from Lobbying Group ALEC,’Reuters, July 12, 2018). However, serious disclosure concerns remain. ExxonMobil belongs to Discredit It,’ Christian Science Monitor, Sep. 17, 2015).
ExxonMobil is a member of the American Petroleum Institute, Business Roundtable (BRT), Chamber of Commerce and National Association of Manufacturers (NAM), which togetheraltogether spent over $65 million$260,410,014 on lobbying for 20132016 and 2014. ExxonMobil is also a member of2017. Both the Western States Petroleum Association, which spent $13,553,942 onBRT and NAM are lobbying in California for 2013 and 2014.against shareholder rights to file resolutions. ExxonMobil does not disclose its memberships in, or payments to, trade associations, or the
portions of such amounts used for lobbying. Transparent reporting would reveal whether
We are concerned that ExxonMobil’s lack of lobbying disclosure presents reputational risks when its lobbying contradicts company assets are being used for objectives contrary to ExxonMobil’s long-term interests.
Andpublic positions. For example, ExxonMobil does not disclose membership in or contributions to tax-exempt organizations that write and endorse model legislation, such as being a membersupports the Paris climate agreement, yet was named one of the American Legislative Exchange Council (ALEC). ExxonMobil’s ALEC membership has drawn press scrutinytop three global corporations lobbying against effective climate policy, (‘ExxonMobil Gave Millions to Climate-Denying Lawmakers despite Pledge,When Corporations Take Credit for Green Deeds Their Lobbying May Tell Another Story,’The GuardianConversation, Jul. 15, 2015)July 17, 2018), and the Chamber undermined the Paris climate accord (‘Paris Pullout Pits Chamber against Some of Its Biggest Members,’Bloomberg, June 9, 2017). More than 100As shareholders, we believe that companies have publicly left ALEC,should ensure there is alignment between their own positions and their lobbying, including BP, ConocoPhillips, Occidental Petroleum and Shell.through trade associations.”
The Board recommends you vote AGAINST this proposal for the following reasons:
The report requested by the proponent is not necessary. The Board fully supports accountability and appropriate transparency and disclosure of lobbying activities and expenditures. As a result, the Company makes its positions on key issues, lobbying expenses, and specific issues lobbied available to the public.
ExxonMobil like many U.S. companies, labor unions,has an established process to determine public policy issues that are important to the Company, which includes reviews by both the Management Committee and other entities, engagesthe Board. We calibrate our lobbying and advocacy efforts accordingly. Positions on key issues and grassroots lobbying communications produced by the Corporation are publicly available on the Exxchange website,exxchange.com, ExxonMobil’s advocacy community portal. Our lobbying is aligned with those positions. The Company’s positions on key issues are also available onexxonmobil.com.
Under ourPolitical Activities Policyand Guidelines, certain employees are authorized to act on behalf of the Company to execute the political activities of the Company, including lobbying. Lobbying is viewed by the Corporation as a political activity in support of business interests. The policy and guidelines are viewable, and lobbying activities are described, in the United StatesPolitical Contributions and Lobbying section onexxonmobil.com. Furthermore, ExxonMobil, and where required, its employee lobbyists, file lobby disclosure reports at both the federalstate and state levels to explain or advocate the Corporation’s position when necessary. ExxonMobil complies fullylocal level in accordance with all applicable state and federal requirements concerning lobbying activity and related disclosures. Pursuant to the federal Lobby Disclosure Act, local lobby disclosure laws.
ExxonMobil publicly reports on a quarterly basis to the U.S. Congress itsour federal lobbying expenses and the specific issues lobbied. The reports are accessible to the general public on the U.S. Senate’s website atsenate.gov. Lobby reports are also filed with state and local jurisdictions as required by law.
ExxonMobil also provides support to a variety of think tanks, trade associations, and coalitions in order to promote informed dialogue and sound public policy on matters pertinent to the Corporation’s interests. Some of the support provided to these organizations may be used by the firms for lobbying. The total figure reported in ExxonMobil’s public LobbyLobbying Disclosure Act filings includes expenses associated with the costs of employee federal lobbying, as well as those portions of payments to trade associations coalitions and think tanksother groups that are spent on federal lobbying.
The Corporation believes the rigor of these requirements provides sufficient transparency and accountability of our public advocacy activities All reports are accessible to the general public including shareholders. The Congresson the U.S. Senate’s website atwww.senate.gov. More recently filed reports are also listed onexxonmobil.com.
Our contributions to more than 100 U.S.-based organizations are detailed in theWorldwide Contributions and Executive Branch are the appropriate recipients of the proponent’s specific positions on our nation’s policy disclosure laws, and any reforms they seek.
The Corporation has an established practice to determine which public policy issues are important to ExxonMobil, which includes gaining input from affected business lines and functional departments such as Law andCommunity Investments: Public and Government Affairs. Key issues are reviewed by the Management Committee and Board of Directors of the Corporation. ExxonMobil’s position on key policy issues are posted in the Current Issues sectionPolicy report available atexxonmobil.com, and our lobbying activities are aligned with those positions. In addition, our policy and procedures governing lobbying, including oversight, can be found in the Accountability section of the same website. We believe detailed disclosures concerning internal deliberations on public policy issues could be competitively harmful, and would be of questionable utility to shareholders.
ExxonMobil promotes discussion on issues of direct relevance to the Company. We contribute to a wide range of academic and policy organizations that research and promote dialogue on significant domestic and foreign policy issues.. Our contributions do not constitute an endorsement of every policy position or point of view expressed by a recipient organization. As is true of all non-profitsnonprofit
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groups we support, we conduct an annual evaluation of the merits of each organization is conducted, and we reserve the right to initiate, sustain, or withdraw support at any time.time as demonstrated by our actions in 2018 when, for example, we withdrew from the American Legislative Exchange Council.
These efforts comply fully with the spirit and letter of all federal and state lobbying disclosure requirements. We believe these existing disclosure laws are appropriately broad and provide the necessary transparency, consistent with that provided by all parties in the political process. ExxonMobil should not be held to a different standard than other groups engaging in such activity. As such, ExxonMobil believes that the risksU.S. Congress, Executive Branch, and state and local governments are the appropriate recipients of climate change are seriousthe proponent’s specific positions on lobbying disclosure laws, and warrant thoughtful action. Managing these risks requires innovation and collaboration. We are dedicatedany reforms they seek.
The annual total compensation of the CEO of the Corporation for 2018 was $18,810,320. The median of the annual total compensation of all employees of the Corporation except the CEO for 2018 was $171,375. The ratio of the annual total compensation of the CEO for 2018 to working to reduce the risksmedian of climate changethe annual total compensation of all employees was 110:1.
The median employee was identified as of October 1, 2018, based on total taxable wages for the most recently completed prior fiscal year as shown in the most efficient wayCorporation’s records. No estimates or sampling methodologies were used for society, while recognizing the importance of reliable and affordable energy in supporting economic growth. We actively engage in constructive dialogue on climate change policy with a wide variety of stakeholders, including governments, non-governmental organizations, academiathis purpose. Nocost-of-living adjustments were made, and the public.taxable wages of employees employed for less than the full fiscal year were not annualized. “Employees” were defined based on applicable employment and tax laws.
Policymakers around the world currently are considering a varietyFor purposes of legislative proposals and regulatory options related to climate policies. ExxonMobil advocates an approach that ensures a uniform and predictable cost of carbon; allows market prices to drive solutions; maximizes transparency to stakeholders; reduces administrative complexity; promotes global participation; and is easily adjusted to future developments in climate science and policy impacts. We continue to believe a revenue-neutral carbon tax is better able to accommodate these key criteria.
ExxonMobil updates shareholders annually on our views on climate change and how the Company plans capital expenditures, assesses and plans for policies limiting greenhouse gas emissions, and works to reduce emissionsthis disclosure, as part of theCorporate Citizenship Report. The Company also periodically responds to specific shareholder requests. Currently available reports and responses are viewable onexxonmobil.com.
A robust civil society requires the airing of different voices and perspectives as part of the nation’s ongoing public policy debate. In light of the importance and implications of sound public policies, ExxonMobil will continue to engage actively with stakeholders who have an interest in key issues that affect the Company and industry.
ITEM 10 – INCREASE CAPITAL DISTRIBUTIONS
This proposal was submittedpermitted by Eric McCallum, a client of Arjuna Capital/Baldwin Brothers Inc., 204 Spring Street, Marion, MA 02738, the beneficial owner of 200 shares.
“Capital Distributions
WHEREAS:
In the face of global climate change, we believe investor capital is at risk from investments in projects that may prove economically stranded and unburnable if fossil fuel demand is reduced through public policy carbon restrictions, pricing and competition from renewables.
Global governments have agreed ‘the increase in global temperature should be below 2 degrees Celsius.’ The International Energy Agency states, ‘No more than one-third of proven reserves of fossil fuels can be consumed prior to 2050 if the world is to achieve the 2º C goal.’
In 2015 Citigroup estimatedSEC rules, the value of unburnable fossil fuel reserves could amount to over 100 trillion dollars out to 2050:nondiscriminatory benefits is included in annual total compensation of both the median employee and the CEO. These nondiscriminatory benefits are long-term disability, basic life insurance, accidental death and dismemberment insurance, medical, and dental.
‘Lessons learned from the strandingWe believe including these benefits provides a more accurate compensation ratio. Since SEC rules do not require inclusion of assets via the recent fallthese generally available benefits in the oil price gives food for thought about whatSummary Compensation Table, the impactannual total compensation of the introduction of carbon pricing (or similar measures from Paris COP21) on higher-cost fossil fuel reserves might be.’
The industry cancelled approximately 200 billion dollars of capex in 2015 (Wood Mackenzie). The Carbon Tracker Initiative (CTI) estimates 2 trillion dollars of industry capex and 72.9 percent of ExxonMobil’s capexCEO shown above is ‘unneeded’ if we are to achieve a 2 degree pathway.
Massive production cost inflation overslightly higher than the past decade has made the industry vulnerable to a downturn in demand and oil prices.
Analysts indicate companies may not be adequately accounting for or disclosing downside risks from lower than expected demand and prices.
Investors are concerned ExxonMobil risks eroding shareholder value through investments in what may prove stranded, uneconomical assets in a low carbon demand scenario. Exxon’s capital expenditures grew at a
compound annual growth rate of 9 percent from 2005 to 2014, coinciding with a 1 percent net income decline. Exxon cut total capital distributions (summing dividends and share buybacks) to shareholders approximately 25 percent over the last twelve months.
RESOLVED:Shareholders hereby approve, on an advisory basis, a proposal that ExxonMobil commit to increasing the total amount authorized for capital distributions (summing dividends and share buybacks) to shareholders as a prudent use of investor capital in light of the climate change related risks of stranded carbon assets.”
The Board recommends you vote AGAINST this proposalTotal Compensation shown for the following reasons:
ExxonMobil published the report,Energy and Carbon – Managing the Risks, to address questions raised on the topic of global energy demand and supply, climate change policy and carbon asset risks. This report further described how the Company integrates consideration of climate change risks into planning processes and investment evaluation. The Board is confidentCEO in that the Company’s robust planning and investment processes adequately contemplate and address climate change related risks.
Each year, we update our long-term energy demand projection in ourOutlook for Energy – taking into account the most up-to-date demographic, economic, technological, and climate policy information available. This analysis serves as a foundation for our long-term business strategies and investments, and is generally consistent with other forecasting organizations such as the International Energy Agency. OurOutlook by no means represents a “business as usual” case and it includes a significant reduction in projected energy use and greenhouse gas (GHG) emissions due to energy efficiency initiatives. Because we assume policy action will become increasingly more stringent over time, ourOutlook projects lower future energy-related CO2 emissions through 2040 than would be implied by a “no policy scenario” where limited GHG reduction policies and regulations are implemented.
ExxonMobil maintains a disciplined capital allocation approach with a long-term horizon. Our commitment to shareholders is to invest in attractive business opportunities and pay a reliable and growing dividend. Across the business cycle, we manage cash by returning excess to shareholders through share repurchases or borrowing to fund our investments.
From 2000 through 2015, the Company returned $357 billion of value to shareholders through dividend payments and share purchases, which reduced outstanding shares by 40 percent. ExxonMobil remains committed to a reliable and growing dividend, which has been increased 33 consecutive years. Despite a nearly 40 percent drop in crude prices in 2015, the dividend was increased by 5.8 percent and $3 billion of stock was repurchased, further enhancing the underlying value of all remaining shares and demonstrating the resiliency of our integrated business model. This value was delivered to shareholders while maintaining a robust capital investment program.table.
ExxonMobil is committed to disciplined investinga global company with employees in attractive opportunities across normal fluctuationsmany countries around the world. As permitted by thede minimisexemption under the SECrules, for purposes of identifying the median employee we have excluded employees from 41 countries, which represent in business cycles. Projects are evaluated under a wide range of possible economic conditions and commodity prices that are reasonably likely to occur. The Company does not publish the economic bases upon which we evaluate investments due to competitive considerations; however, it applies prudent and substantial safety margins in our planning assumptions to help ensure robust returns.
The Company also stress tests its oil and natural gas capital investment opportunities, which provides an added margin of safety against uncertainties, such as those related to technology, regulation/legislation, costs, geopolitics, availability of required materials, services, and labor. Such stress testing differs from alternative scenario planning, which we do not develop, but stress tests provide us an opportunity to fully consider a wide range of market conditions in the planning and investment process.
The Company addresses the potential for future climate-related policy, including the potential for restriction on emissions, through the use of a proxy cost of carbon. The proxy cost seeks to reasonably reflect the types of actions and policies that governments may take over the outlook period relating to the exploration, development, production, transportation or use of carbon-based fuels. This proxy cost of carbon is embedded in ourOutlook for Energy, and has been a featureaggregate less than 5 percent of the report since 2007. All business segments areCorporation’s total employees. As required, to include, where appropriate, an estimate of the costs associated with greenhouse gas emissions in their economics when seeking funding for capital investments.
The scale and integrated nature of our operating cash flows along with prudent cash management provide unmatched financial strength, enabling the Company to invest in attractive projects throughout the business cycle.
A key strategy to ensure investment selectivity underany employees from a wide range of economic assumptions is to maintain a diverse portfolio of oil, gas, and petrochemical investment opportunities. This diversity, in terms of resource type and corresponding development options (oil, gas, natural gas liquids, onshore, offshore, deepwater, conventional, unconventional, liquefied natural gas) and geographic dispersion, is unparalleled in the industry.
These factors have positioned ExxonMobil consistently as an industry leader in return on capital employed and underpin our ability to continue leading shareholder distributions and maintain a long-term investment programjurisdiction were excluded, all employees from that creates significant shareholder value.
This proposal was submitted by the Sisters of St. Dominic of Caldwell New Jersey, 40 South Fullerton Avenue, Montclair, NJ 07042, the beneficial owner of 200 shares and lead proponent of a filing group.
“Whereas:
Pope Francis, in his encyclical letter Laudato Si’, states that ‘the climate is a common good, belonging to all and meant for all.’1 Numerous faith traditions have issued statements highlighting the moral responsibility to address climate change and care for creation and calling for urgent action.2 They join experts in science, business, and politics who have stated that global warming is unequivocal, that climate change is human-induced, and that its decisive mitigation is a moral imperative for humanity.3
The poor and most vulnerable are the first to suffer, while future generations, holding no responsibility, will live with greater impacts of global warming.
World leaders in the 2010 Cancun Agreement agreed to limit warming of the average global atmospheric temperature to less than 2 degrees Centigrade (2°C) above pre-industrial levels in order to prevent the worst impacts of climate change, including extreme weather, drought, rising sea levels, crop failure, and accelerated species loss. These impacts will likely have societal consequences including migration, food insecurity, and conflict. The World Bank and the Intergovernmental Panel on Climate Change warn that if warming exceeds 2°C, there are risks of ‘triggering nonlinear tipping elements’ thus producing ‘irreversible’ impacts.
The emissions profile of ExxonMobil’s 2015Outlook for Energy report approximates scenarios that would entail warming in excess of 2°C.4
ExxonMobil claims that its energy production responds to a ‘moral imperative’5 to meet growing energy demand and eradicate poverty, but this does not offset the necessity to mitigate climate change or the moral imperative to limit warming to 2°C. Further, World Bank and energy analyst reports conclude that renewable energy provides a better pathway to energy access.6 Billions of people living in energy poverty are not only the least responsible for greenhouse gas (GHG) emissions, but also likely to be most adversely impacted by climate change.7
As a large GHG emitter with carbon intensive products, ExxonMobil should robustly support the global framework to address climate change resulting from the 21st Conference of Parties of the United Nations Framework Convention on Climate Change in December 2015. Constructive engagement on climate policy is especially important given Exxon’s historical role in financing climate denial and misinformation campaigns on climate change.8 Failing to address this could present reputational risk for ExxonMobil.jurisdiction were excluded. In contrast to ExxonMobil, ten oil industry peers including Total, Shell, BP, and Saudi Aramco, and business leaders in other industries, support an international agreement to limit warming to 2°C.9
Resolved: Shareholders request that the Board of Directors adopt a policy acknowledging the imperative to limit global average temperature increases to 2°C above pre-industrial levels, which includes committing the Company to support the goal of limiting warming to less than 2°C.
SUPPORTING STATEMENT
We believe that ExxonMobil should assert moral leadership with respect to climate change. This policy would supplement ExxonMobil’s existing positions on climate policy.
The Board recommends you vote AGAINST this proposal for the following reasons:
ExxonMobil takes the risks of global climate change seriously and believes these risks warrant thoughtful action. The long-term objective of climate change policy should be to reduce the risks of serious harm to humanity and ecosystems at minimum societal cost, while recognizing additional shared humanitarian necessities, including providing reliable and affordable energy to improve global living standards.
The Board believes the Company has an obligation to shareholders to continue to invest in economically attractive energy sources in an environmentally responsible manner. The Board further believes the Company’s capabilities are best utilized finding practical, achievable solutions to address climate change risks consistent with the Company’s mandate, rather than focusing on a future global temperature stabilization outcome that ultimately will be dictated by many variables beyond the Company’s control.
Recognizing that reducing greenhouse gas emissions across the global economy is a shared objective, the Company remains focused on finding practical, prudent, and affordable solutions to address the dual challenge of expanding energy supplies to support economic growth, improve living standards, alleviate poverty, and improve resilience while simultaneously addressing the societal and environmental risks posed by rising greenhouse gas emissions and climate change.
Through effective solutions, progress can and has been made. For example, according to the U.S. Energy Information Agency, CO2 emissions in the U.S. power sector are down 15 percent since 2005, with 60 percent of this reduction reflecting the benefit of shifting from coal to natural gas. Also, per the U.S. Environmental Protection Agency, net methane emissions from natural gas have fallen 38 percent since 2005, during which time U.S. natural gas production has increased by 26 percent. Looking forward, we believe more progress will be made in the development of low greenhouse gas emissions technology, such as advanced carbon capture and sequestration (CCS).
As the policy and regulatory landscape has continued to develop, we have proactively addressed this global challenge. We have long taken action by increasing energy efficiency and reducing greenhouse gas emissions in our operations, providing products that help consumers reduce their emissions, supporting research into technology breakthroughs, and participating in constructive dialogue on policy options with non-governmental organizations, industry, and policy makers.
Each year, we update our long-term energy demand projection in ourOutlook for Energy – taking into account the most up-to-date demographic, economic, technological, and climate policy information available. This analysis serves as a foundation for our long-term business strategies and investments, and is generally consistent with other forecasting organizations such as the International Energy Agency. OurOutlook by no means represents a “business as usual” case and it includes a significant reduction in projected energy use and GHG emissions due to energy efficiency initiatives. Because we assume policy action will become increasingly more stringent over time,
ourOutlook projects lower future energy-related CO2 emissions through 2040 than would be implied by a ‘no policy scenario’ where limited GHG reduction policies and regulations are implemented.
ExxonMobil believes that effective policies to address climate change should put a price on greenhouse gas emissions that will:
ExxonMobil has for many years held the view that a revenue-neutral carbon tax is the best option to fulfill these key principles. Instead of subsidies and mandates that distort markets, stifle innovation, and needlessly raise energy costs, a carbon tax could help create the conditions to reduce greenhouse gas emissions in a way that spurs new efficiency and technology solutions at the lowest cost to society and consumers.
This proposal was submitted by the New York State Common Retirement Fund, 59 Maiden Lane – 30th Floor, New York, NY 10038, the beneficial owner of 10,926,248 shares and lead proponent of a filing group.
“RESOLVED: Shareholders request that by 2017 ExxonMobil publish an annual assessment of long term portfolio impacts of public climate change policies, at reasonable cost and omitting proprietary information. The assessment can be incorporated into existing reporting and should analyze the impacts on ExxonMobil’s oil and gas reserves and resources under a scenario in which reduction in demand results from carbon restrictions and related rules or commitments adopted by governments consistent with the globally agreed upon 2 degree target. The reporting should assess the resilience of the company’s full portfolio of reserves and resources through 2040 and beyond and address the financial risks associated with such a scenario.
Supporting Statement:
It is our intention that this be a supportive but stretching resolution that ensures the long-term success of the company.
Recognizing the severe and pervasive economic and societal risks associated with a warming climate, global governments have agreed that increases in global temperature should be held below 2 degrees Celsius from pre-industrial levels (Cancun Agreement). Pursuant to the Durban Platform, 184 parties submitted plans to reduce greenhouse gas emissions in advance of the 21st Conference of the Parties. In November 2014 the United States and China agreed to policy and regulatory actions to reduce greenhouse gas emissions and re-affirmed and expanded those actions in September 2015.
ExxonMobil recognized in its 2014 10-K that ‘a number of countries have adopted, or are considering adoption of, regulatory frameworks to reduce greenhouse gas emissions,’ and that such policies, regulations, and actions could make its ‘products more expensive, lengthen project implementation timelines and reduce demand for hydrocarbons,’ but ExxonMobil has not presented any analysis of how its portfolio performs under a 2 degree scenario.
In response to a previous shareholder resolution regarding Carbon Asset Risk, ExxonMobil asserted ‘that an artificial capping of carbon-based fuels to levels in the ‘low carbon scenario’ [such as IEA 450ppm] is highly unlikely’ and did not test its portfolio against a 2 degree scenario.
However, ExxonMobil’s peers, Shell, BP, and Statoil have recognized the importance of assessing the impacts of these scenarios by endorsing the ‘Strategic Resilience for 2035 and beyond’ resolutions that received almost
unanimous investor support in 2015. BHP Billiton now publishes a ‘Climate Change: Portfolio Analysis’ evaluating its assets against 2 degree scenarios, and ConocoPhillips states that it stress tests its portfolio against 2 degree scenarios. More recently, ten major oil and gas companies have announced that they will support the implementation of clear stable policy frameworks consistent with a 2 degree future.
This resolution aims to ensure that ExxonMobil fully evaluates and mitigates risks to the viability of its assets as a result of public climate change policies, including in a 2 degrees scenario.”
The Board recommends you vote AGAINST this proposal for the following reasons:
In 2014, ExxonMobil published the report, Energy and Carbon – Managing the Risks, to provide shareholders an enhanced description of global energy demand and supply, climate change policy and carbon asset risks. This report further described how the Company integrates consideration of climate change risks into planning processes and investment evaluation. The Board is confident that the Company’s robust planning and investment processes adequately contemplate and address climate change related risks, ensuring the viability of its assetstotal, as detailed in the above report. This report is found atexxonmobil.com intable below, 2,924 employees were excluded under theClimatede minimis section.exemption of a total number of 72,619 worldwide employees.
ExxonMobil believes that producing our existing hydrocarbon resources is essential to meeting growing global energy demand. We enable consumers – especially those in the least-developed and most-vulnerable economies – to pursue higher living standards and greater economic opportunity. We believe all economic energy sources will be necessary to meet growing demand, and the transition
| Countries Excluded / Number of Employees | |||||||||||||||||||||||||||||
| 1. |
| Norway |
| 395 |
| 12. | Sweden |
| 72 |
| 23. | South Korea |
| 22 |
| 34. | Tanzania | 4 | |||||||||||
| 2. |
| Egypt |
| 343 |
| 13. | Taiwan |
| 71 |
| 24. | Romania |
| 21 |
| 35. | Mauretania | 4 | |||||||||||
| 3. |
| Chad |
| 307 |
| 14. | United Arab Emirates |
| 71 |
| 25. | N. Mariana Island |
| 20 |
| 36. | Cameroon | 3 | |||||||||||
| 4. |
| Mexico |
| 274 |
| 15. | Cyprus |
| 52 |
| 26. | Saudi Arabia |
| 14 |
| 37. | Azerbaijan | 3 | |||||||||||
| 5. |
| Equatorial Guinea |
| 270 |
| 16. | Guam |
| 38 |
| 27. | Spain |
| 13 |
| 38. | Luxembourg | 3 | |||||||||||
| 6. |
| Qatar |
| 143 |
| 17. | Poland |
| 36 |
| 28. | South Africa |
| 12 |
| 39. | Peru | 2 | |||||||||||
| 7. |
| Japan |
| 141 |
| 18. | Fiji |
| 32 |
| 29. | Micronesia |
| 9 |
| 40. | Ghana | 2 | |||||||||||
| 8. |
| Turkey |
| 125 |
| 19. | Kazakhstan |
| 32 |
| 30. | Vietnam |
| 7 |
| 41. | Switzerland | 2 | |||||||||||
| 9. |
| Guyana |
| 107 |
| 20. | New Caledonia |
| 26 |
| 31. | Greece |
| 7 |
| ||||||||||||||
| 10. |
| Finland |
| 94 |
| 21. | Mozambique |
| 25 |
| 32. | Denmark |
| 7 |
| ||||||||||||||
| 11. |
| New Zealand |
| 87 |
| 22. | Colombia |
| 23 |
| 33. | Ukraine |
| 5 |
|
Total number of the energy system to lower carbon sources will take many decades due to its enormous scale, capital intensity and complexity. As such, we believe that none of our proven hydrocarbon reserves are, or will become, stranded. This is further detailed in the aforementioned report.
Each year, we update our long-term energy demand projection in ourOutlook for Energy – taking into account the most up-to-date demographic, economic, technological, and climate policy information available. This analysis serves as a foundation for our long-term business strategies and investments, and is generally consistent with other forecasting organizations such as the International Energy Agency. OurOutlook, which can be foundat exxonmobil.com/energyoutlook, by no means represents a “business as usual” case and it includes a significant reduction in projected energy use and GHG emissions due to energy efficiency initiatives. TheOutlook projects lower future energy-related CO2 emissions through 2040 than would be implied by a “no policy scenario” where limited GHG reduction policies and regulations are implemented.
In December 2015, parties to the United Nations Framework Convention on Climate Change (UNFCCC) convened in Paris for the 21st Conference of the Parties (COP 21). COP 21 resulted in a global compact, which for the first time, directs all parties to undertake action on climate change and report on related progress. For many years, ourOutlook has taken into account the potential for climate polices to become increasingly stringent over time by imposing higher costs on energy-related carbon dioxide emissions. Preliminary analysis of the aggregation of intended nationally determined contributions, which were submitted by governments as part of the COP 21 process, indicates a greenhouse gas emissions trajectory similar to that anticipated in ourOutlook.
We address the potential for future climate change policy, including the potential for restrictions on emissions, by estimating a proxy cost of carbon. This cost, which in some geographies may approach $80 per ton by 2040, has been included in ourOutlook since 2007. This approach seeks to reflect potential policies governments may employ related to the exploration, development, production, transportation or use of carbon-based fuels. We believe our view on the potential for future policy action is realistic and we require all of our business lines to include, where appropriate, an estimate of GHG-related emissions costs in their economics when seeking funding for capital investments.
We evaluate potential investments and projects using a wide range of economic conditions and commodity prices. We apply prudent and substantial margins in our planning assumptions to help ensure competitive returns over a wide range of market conditions. We also financially “stress test” our investment opportunities, which provides an added margin against uncertainties, such as those related to technology development, costs, regulation/legislation, geopolitics, availability of required materials, services, and labor. Stress testing, which differs from alternative scenario planning, further enables us to consider a wide range of market environments in our planning and investment process.
We maintain our long-standing commitment to energy efficiency, progressing the benefits of natural gas, research and development in alternative energies, providing access to energy, and constructive engagement with industry, governments, academic institutions, trade associations, and known external experts. We are an active participant in the International Petroleum Industry Environmental Conservation Association (IPIECA), an association that advances ideas and potential solutions for the industry concerning the risk of climate change.
In summary, while the Board agrees with the importance of assessing the resiliency of the Company’s resource portfolio, it believes the current processes as described above sufficiently test the portfolio to ensure long-term shareholder value. Framed by the 2014 report and assessed annually through stress testing in ourOutlookand in investment planning, we remain confident in the commercial viability of our portfolio. Furthermore, all proved reserves fully comply with SEC definitions and requirements as detailed in our annual 10-K.employees excluded: 2,924
2019 Proxy Statement | ![]() | 69 |
This proposal was submitted by Adelaide Gomer, c/o As You Sow, 1611 Telegraph Ave., Suite 1450, Oakland, CA 94612, the beneficial owner of 150 shares and lead proponent of a filing group.
“Whereas:The current accounting system for oil and gas reserve replacement has inherent limitations that impede ExxonMobil’s ability to adapt to a climate constrained global energy market.
A primary metric the market uses to assess the value of an oil and gas company is its reserve replacement ratio. (Cambridge Energy Policy Forum, March 2015). Reserve replacement is currently denominated in oil and gas units, incentivizing the production and development of new oil and gas reserves. Where annual oil and gas reserve replacement is not fully achieved, a company’s stock market value is likely to be impaired and top company executives may not receive full incentive packages. This fuel specific reporting metric does not allow management the latitude needed to optimize enterprise goals in a carbon constrained environment.
Global governments recognize severe risks associated with a warming climate and the need to limit warming to 2 degrees Celsius or less. At the Conference of the Parties in Paris, world leaders made significant commitments to reduce greenhouse emissions and initiated discussions to implement carbon pricing policies. As worldwide energy needs grow, it is becoming increasingly likely that such demand will be met with a much greater amount of renewable energy. Climate change induced transitions are already occurring in energy markets in the form of rapid energy efficiency increases, decreasing costs of renewables, and disruptive technology development such as electric vehicles.
The need for Exxon to develop new pathways in response to these transitions is highlighted by Citi, Statoil, and other analysts, which predict that global oil demand could peak in the next 10 to 15 years. As the 2015 oil market decline demonstrates, even a relatively small global oversupply of oil can substantially decrease the value of oil companies.
Company management must have maximum flexibility to optimize production and development of energy reserves in line with these changing market conditions and opportunities. Further, management should be incentivized to adopt a stable, long-term revenue path that includes replacing carbon holdings with renewable energy. The current system of oil and gas reserve replacement accounting hampers such flexibility and creates inappropriate incentives. Moving to a system that accounts for resources in energy units, such as the internationally accepted standard British Thermal Units, instead of oil and gas, will create a new measure of successful operation and incentivize a stable transition to a climate appropriate resource mix. It will also help foster better company valuations by investors, creditors, and analysts, thus improving capital allocation and reducing investment risk.
Resolved:Proponents request that, by February 2017 and annually thereafter in a publication such as its annual or Corporate Social Responsibility report, Exxon quantify and report to shareholders its reserve replacements in British Thermal Units, by resource category, to assist the Company in responding appropriately to climate change induced market changes. Such reporting shall be in addition to reserve reporting required by the Securities and Exchange Commission, and should encompass all energy resources produced by the company.”
The Board recommends you vote AGAINST this proposal for the following reasons:
The current practice of reporting annual reserves replacement on an Oil-Equivalent Basis is the industry standard and compliant with the requirements of the Securities and Exchange Commission. Supplementing that statutory reporting with a BTU-based equivalent would not fundamentally provide the investment community with additional information nor influence investment choices. Importantly, the Company’s success as measured by the stock market is not, as the proposal suggests, driven by reserve replacement, but primarily by financial performance over a period consistent with investment horizons.
ExxonMobil executives are not compensated on the basis of a reserves replacement ratio. As detailed in ourExecutive Compensation Overview (ECO) and our Proxy Statement, the Compensation Committee assesses ExxonMobil’s leadership position in seven key areas in determining the appropriateness of total compensation. These seven metrics include Safety and Operations Integrity, Return on Average Capital Employed, Strategic Initiatives, Free Cash Flow, Shareholder Distributions, Total Shareholder Return and Project Execution. TheECO demonstrates how outstanding performance is required in all seven of these areas to result in a top award.
ExxonMobil’s long-termOutlook for Energy (exxonmobil.com/energyoutlook) is updated annually to reflect global economic and demographic trends as well as emerging technologies and policies that will impact energy supply and demand. As in past years, theOutlook continues to assume governments will place significant costs on greenhouse gas (GHG) emissions. TheOutlook also anticipates that even with substantial gains in efficiency, and strong growth in nuclear and modern renewable energy supplies, demand for oil will continue to rise through 2040, driven by developing nations. Credible third-party outlooks, including those developed by the International Energy Agency (IEA) and the U.S. Department of Energy, share this view. Also consistent with theOutlook, the IEA sees natural gas growing more than any other energy type through 2040, reflecting its ability to meet a wide variety of needs and provide one of the most cost-effective ways to reduce GHG emissions. The rising use of natural gas is a key factor in theOutlook’s view that by 2040 the carbon intensity of the global economy is likely to fall by half.
We address the potential for future climate change policy, including the potential for restrictions on emissions, by estimating a proxy cost of carbon. This cost, which in some geographies may approach $80 per ton by 2040, has been included in ourOutlook since 2007. This approach seeks to reflect potential policies governments may employ related to the exploration, development, production, transportation or use of carbon-based fuels. We believe our view on the potential for future policy action is realistic and, by no means represents a “business as usual” case. We require all of our business lines to include, where appropriate, an estimate of GHG-related emissions costs in their economics when seeking funding for capital investments.
ExxonMobil monitors the business environment, including long-term supply and demand fundamentals. The Company is structured to capture shareholder value throughout the commodity price cycle and is well positioned for the future. Moving to a system that accounts for reserves in energy units will not enhance ExxonMobil’s ability to create shareholder value.
This proposal was submitted by the Park Foundation, P.O. Box 550, Ithaca, NY 14851, the beneficial owner of 117 shares.
“WHEREAS:
Extracting oil and gas from shale formations using hydraulic fracturing and horizontal drilling technology has become a controversial public issue. Leaks, spills, explosions and community impacts have led to bans and moratoria in New York State and elsewhere in the U.S., putting the industry’s social license to operate at risk. Hydraulic fracturing has also become a topic of controversy in many locations across the world, including in Germany which has impacted ExxonMobil’s unconventional oil and gas development in the region.
Disclosure of management practices and their impacts is the primary means by which investors can assess how companies are managing the risks of their operations. The Department of Energy’s Shale Gas Production Subcommittee recommended that companies ‘adopt a more visible commitment to usingquantitative measures as a means of achieving best practice and demonstrating to the public that there is continuous improvement in reducing the environmental impact of shale gas production.’
ExxonMobil has become a laggard in the oil and gas industry in its disclosure practices. In a 2015 report ‘Disclosing the Facts: Transparency and Risk in Hydraulic Fracturing Operations’, which ranked companies on disclosure of quantitative information to investors, Exxon scored only 4 out of 39 points for its disclosure practices. Two thirds of the companies reviewed earned higher scores for their disclosures.
Exxon’s subsidiary, XTO Energy, was cited for having 113 hydraulic fracturing environmental and health violations, from January 2011 to August 2014, in Pennsylvania alone (Environment America, Fracking Failures, 2015). These violations have increased shareholder concern about Exxon’s practices.
Due to Exxon’s poor disclosure performance, investors call for the Company to provide detailed, quantitative, comparable data about how it is managing the risks and reducing the impacts of its hydraulic fracturing extraction operations. ItsOperations Integrity Management System fails to provide such reporting to investors; as a generalized framework for companywide operations, it provides no specific information on the company’s shale energy operations.
THEREFORE BE IT RESOLVED:
Shareholders request the Board of Directors report to shareholders, using quantitative indicators, by December 31, 2016, and annually thereafter, the results of company policies and practices above and beyond regulatory requirements, to minimize the adverse environmental and community impacts from the company’s hydraulic fracturing operations associated with shale formations. Such report should be prepared at reasonable cost, omitting confidential information.
SUPPORTING STATEMENT:
Proponents suggest the report provide quantitative information for each play in which the company has substantial extraction operations, on issues including, at a minimum:
The Board recommends you vote AGAINST this proposal for the following reasons:
The Board believes the Company has provided a comprehensive and sufficient discussion of its policies and practices on risk management of unconventional resource development, including hydraulic fracturing. Additional quantitative reporting at the “play level” will not improve our risk management or community engagement efforts.
The Company details its risk management practices in several public documents in order to inform key stakeholders. In September 2014, ExxonMobil prepared the report,Unconventional Resources Development – Managing theRisks, which describes in detail how the Company assesses and manages risks associated with developing unconventional resources. This report is available atexxonmobil.com/hfreport. Further, the Company’s annualCorporate Citizenship Report also discusses risk management issues associated with unconventional resource development.
The Company continually engages with communities in which we operate regarding upcoming and ongoing operations. We learn of community concerns directly and address them in a timely and proactive manner.
Modern drilling technologies and adherence to appropriate safety protocols allow unconventional oil and gas resources to be developed in a manner that protects human health and the environment, and we are committed to environmentally responsible operations. Our Environment Policy and Operations Integrity Management System commit us to continuous efforts to improve environmental performance. The reports cited by the proposal including the Proponent’s report do not credibly represent the Company’s performance.
This is the seventh year such a proposal has been filed. The proposal fails to recognize the continued operational enhancements and disclosures made by industry, and the significant expansion of federal and state regulatory requirements that govern industry operations.
A subset of detailed “by play” data as suggested by the proposal, all of which are managed by industry best practices and federal and state regulation, will not meaningfully inform the shareholder. Informing shareholders of the risks and how these risks are effectively managed is important, which we have done through the 2014 report mentioned above and through our annualCorporate Citizenship Report.
Other Business
We are not currently aware of any other business to be acted on at the annual meeting. Under the laws of New Jersey, where ExxonMobil is incorporated, no business other than procedural matters may be raised at the meeting unless proper notice has been given to the shareholders. If other business is properly raised, your proxies have authority to vote as they think best, including to adjourn the meeting.
People withWith Disabilities
We can provide reasonable assistance to help you participate in the meeting if you tell us about your disability and your plans to attend. Please call or write the Secretary at least two weeks before the meeting at the telephone number, address, or fax number listed under Contact Information on page 4.7.
Outstanding Shares
On February 29, 2016,28, 2019, there were 4,150,241,2794,233,104,962 shares of common stock outstanding. Each common share has one vote.
How We Solicit Proxies
In addition to this mailing, ExxonMobil officers and employees may solicit proxies personally, electronically, by telephone, or with additional mailings. ExxonMobil pays the costs of soliciting this proxy. We are paying D.F. King & Co. a fee of $30,000 plus expenses to help with the solicitation. We also reimburse brokers and other nominees for their expenses in sending these materials to you and getting your voting instructions.
Shareholder Proposals and Director Nominations for Next Year
Any shareholder proposal for the annual meeting in 20172020 must be sent to the Secretary at the address or fax number of ExxonMobil’s principal executive office listed under Contact Information on page 4.7. The deadline for receipt of a proposal to be considered for inclusion in the 20172020 proxy statement is 5:005 p.m., Central Time, on December 14, 2016.13, 2019. The deadline for notice of a proposal for which a shareholder will conduct his or her own solicitation is February 27, 2017.26, 2020. Upon request, the Secretary will provide instructions for submitting proposals.
Submissions of nominees for director under the proxy access provisions of our bylaws for the 2020 annual meeting must be submitted in compliance with those bylaws no later than December 13, 2019, and no earlier than November 13, 2019. Notice of a director nomination other than under proxy access must be submitted in compliance with the advance notice provisions of our bylaws no later than January 30, 2020, and no earlier than December 31, 2019.
Duplicate Annual Reports
Registered shareholders with multiple accounts may authorize ExxonMobil to discontinue mailing annual reports on an account by calling ExxonMobil Shareholder Services at the toll-free telephone number listed on page 47 at any time during the year. Beneficial holders should contact their banks, brokers, or other holders of record to discontinue duplicate mailings. At least one account must continue to receive an annual report. Eliminating these duplicate mailings will not affect receipt of future proxy statements and proxy cards.
Shareholders withWith the Same Address
If you share an address with one or more ExxonMobil shareholders, you may elect to “household” your proxy mailing. This means you will receive only one set of proxy materials at that address unless one or more shareholders at that address specifically elect to receive separate mailings. Shareholders who participate in householding will
continue to receive separate proxy cards. Householding will not affect dividend check mailings. We will promptly send separate proxy materials to a shareholder at a shared address on request. Shareholders with a shared address may also request us to send separate proxy materials in the future, or to send a single copy in the future, if we are currently sending multiple copies to the same address.
70 | ![]() | 2019 Proxy Statement |
Requests related to householding should be made by calling ExxonMobil Shareholder Services at the telephone number listed on page 4.7. Beneficial shareholders should request information about householding from their banks, brokers, or other holders of record.
SEC Form10-K
Shareholders may obtain a copy of the Corporation’sAnnual Report on Form10-K to the Securities and Exchange Commission without charge by writing to the Secretary at the address listed under Contact Information on page 4,7, or by visiting ExxonMobil’s website atexxonmobil.com/secfilings.
2019 Proxy Statement | ![]() | 71 |
ExxonMobil 20162019 Annual Meeting
Wednesday, May 25, 201629, 2019
9:30 a.m., Central Time
Morton H. Meyerson SymphonyRenaissance Dallas Hotel Conference Center
2301 Flora Street2222 North Stemmons Freeway
Dallas, Texas 7520175207
Free parkingself-parking is availableprovided at the Hall Arts Center Parking Garage. Traffic and constructionRenaissance Hotel in the area may cause a delay; please allow extra time for parking.parking garage and in the hotel’s uncovered ground-level parking lot.
FromI-45/Hwy. 75 – Take I-35E exitI-345, Exit 286A,TX-366 Spur West (Woodall Rodgers Frwy.)Freeway) andI-35E North to Pearl StreetNorth Stemmons Freeway. Take exit or St. Paul exit (follow frontage road east to Pearl Street); turn south430B-430C fromI-35E North toward Market Center Boulevard/Wycliff Avenue. Merge onto North Stemmons Freeway. Hotel is located at North Stemmons Freeway and continue to Ross Avenue; turn left to the Hall Arts Center Parking Garage.Wycliff Avenue.
From I-35EI-35 – Take I-45/Hwy. 75 exit (Woodall Rodgers Frwy.) to Pearl Street exit; continue to Ross Avenue; turn left to the Hall Arts430B-430C toward Market Center Parking Garage.Boulevard/Wycliff Avenue. Merge onto North Stemmons Freeway. Hotel is located at North Stemmons Freeway and Wycliff Avenue.
From DFW Airport – Take South exit to Hwy. 183 East. Follow 183 East (merges with I-35E); follow directions from I-35E (above).to Interstate 35/Stemmons Freeway South. Continue on the freeway to exit 430C for Wycliff Avenue. Turn left off exit. Travel under the bridge then turn left onto North Stemmons Freeway. The hotel entrance will be on the right.
From Love Field – Exit airportTake first right turn onto West Mockingbird Lane. Merge onto southbound Harry Hines Boulevard then make a slight right onto Market Center Boulevard. Take the second right turn onto North Stemmons Freeway. The hotel entrance will be on Mockingbird Lane west to I-35E South; follow directions from I-35E (above).the right.
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![]() | Your vote matters – here’s how to vote! You may vote online or by phone instead of mailing this card. |
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Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas. | ☒ | Save paper, time, and money Sign up for electronic delivery at www.investorvote.com/exxonmobil | ||||||
q IF VOTING BY MAIL, SIGN THE REVERSE SIDE, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q
VOTING ITEMS — The Directors recommend a voteFOR |
1. Election of Directors (page 16):
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The Directors recommend a voteAGAINST shareholder proposal items 4 through 14.
1. Election of Directors: | For | Against | Abstain | For | Against | Abstain | For | Against | Abstain | + | ||||||||||||||
01 - Susan K. Avery | ☐ | ☐ | ☐ | 05 - Steven A. Kandarian | ☐ | ☐ | ☐ | 08 - Steven S Reinemund | ☐ | ☐ | ☐ | |||||||||||||
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03 - Ursula M. Burns | ☐ | ☐ | ☐ | 07 - Samuel J. Palmisano | ☐ | ☐ | ☐ | 10 - Darren W. Woods | ☐ | ☐ | ☐ | |||||||||||||
04 - Kenneth C. Frazier | ☐ | ☐ | ☐ |
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c/o Computershare Investor Services
P.O. Box 43105
Providence, RI 02940-5076
2019 Annual Meeting of Shareholders Admission Ticket | ||||||
TIME | Wednesday, May | 29, 2019 | ||||
9:30 a.m. | ||||||
PLACE | ||||||
2222 North Stemmons Freeway | ||||||
Dallas, | TX 75207 | |||||
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ADMISSION |
This ticket will admit shareholder. For safety and security reasons, cameras, smartphones, recording equipment, electronic devices, computers, large bags, briefcases, packages, and firearms or other weapons will not be permitted in the building. |
Small steps make an impact. Help the environment by consenting to receive electronic delivery, sign up at www.investorvote.com/exxonmobil |
q IF VOTING BY MAIL, SIGN BELOW, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.q
PROXY/VOTING INSTRUCTIONS | + | |
Solicited by the Board of Directors | ||
The undersigned hereby appoints, and instructs the appropriate account trustee(s), if any, to appoint, | ||
This proxy covers shares of ExxonMobil common stock registered in the name of the undersigned (whether certificated or book entry) and shares held in the name of the undersigned in the Computershare Investment Plan. This card also provides voting instructions to the applicable trustees for any shares held in the name of the undersigned in the ExxonMobil Savings Plan and/or a Computershare Investment Plan IRA. | ||
If no other indication is made on the reverse side of this form, the proxies/trustees shall vote: (a) for the election of the director nominees; and (b) in accordance with the recommendations of the Board of Directors on the other matters referred to on the reverse side. |
NON-VOTING ITEMS |
Change of Address— Please print new address below. | Comments— Please print your comments below. | |||
AUTHORIZED SIGNATURES — This section must be completed for your vote to be counted. Date and sign below. |
Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title. | ||||||||
Date (mm/dd/yyyy) — Please print date below. | Signature 1 — Please keep signature within the box. | Signature 2 — Please keep signature within the box. | ||||||
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