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

Filed by the Registrant  ☐☒                             Filed by a party other than the Registrant  ☐

Check the appropriate box:

Valero Energy 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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Notice of 20182020 Annual Meeting of Stockholders

Our Board is soliciting proxies to be voted at the Annual Meeting of Stockholders on May 3, 2018April 30, 2020 (the “Annual Meeting”). The accompanying notice describes the time, place, and purposes of the Annual Meeting. Action may be taken at the Annual Meeting or on any date to which the meeting may be adjourned. Unless otherwise indicated the terms “Valero,” “we,” “our,” and “us” in this proxy statement refer to Valero Energy Corporation, to one or more of our consolidated subsidiaries, or to all of them taken as a whole. “Board” means our board of directors.

We are mailing ourNotice of Internet Availability of Proxy Materials (“Notice”) to stockholders on or about March 21, 2018.19, 2020. On this date, you will be able to access all of our proxy materials on the website referenced in the Notice.

RECORD DATE, SHARES OUTSTANDING, QUORUM

Holders of record of our common stock, $0.01 par value (“Common Stock”), at the close of business on March 6, 20184, 2020 (the “record date”) are entitled to vote on the matters presented at the Annual Meeting. On the record date, 430,922,297408,545,828 shares of Common Stock were issued and outstanding and entitled to one vote per share. Stockholders representing a majority of voting power, present in person or represented by properly executed proxy, will constitute a quorum.

VOTING IN PERSON, REVOCABILITY OF PROXIES

If you attend the Annual Meeting and want to vote in person, we will give you a ballot at the meeting.

If your shares are registered in your name, you are considered the stockholder “of record” and you have the right to vote the shares at the meeting.

If, however, your shares are held in the name of your broker or other nominee, you are considered the beneficial owner of shares held in “street name.” As a beneficial owner, if you wish to vote at the meeting, you will need to bring to the meeting a legal proxy from the stockholder of record (e.g.(e.g., your broker) authorizing you to vote the shares.

You may revoke your proxy at any time before it is voted at the Annual Meeting by (i) submitting a written revocation to Valero, (ii) returning a subsequently dated proxy to Valero, or (iii) attending the Annual Meeting, requestingrequest that your proxy be revoked, and votingvote in person at the Annual Meeting. If instructions to the contrary are not provided, shares will be voted as indicated on the proxy card.

REQUIRED VOTES

For Proposal 1, as required by Valero’s bylaws, each director is to be elected by a majority of votes cast with respect to that director’s election.

Proposals 2, 3 and 34 require approval by the affirmative vote of a majority of the voting power of the shares present in person or by proxy at the Annual Meeting and entitled to vote.

Proposals 4 and 5 require approval by the affirmative vote of the holders of at least 80 percent of the voting power of the outstanding Common Stock.

EFFECT OF ABSTENTIONS

Shares voted to abstain are treated as “present” for purposes of determining a quorum. In the election of directors (Proposal 1), pursuant to our bylaws, shares voted to abstain are not deemed “votes cast,” and are accordingly disregarded. When approval for a proposal requires (i) the affirmative vote of a majority of the voting power of the shares present in person or by proxy and entitled to vote (Proposals 2, 3 and 3)4), or (ii) the affirmative vote of a majority of the voting power of the issued and outstanding Common Stock, or (iii) the affirmative vote of the holders of at least 80 percent of the voting power of the issued and outstanding Common Stock (Proposals 4 and 5), then shares voted to “abstain” have the effect of a negative vote (a vote “against”).

20182020 ANNUAL MEETING OF STOCKHOLDERS

BROKERNON-VOTES

Brokers holding shares must vote according to the specific instructions they receive from the beneficial owners of the stock. If your broker does not receive specific voting instructions from you, in some cases the broker may vote the shares in the broker’s discretion. However, the

The New York Stock Exchange (the “NYSE”) precludes brokers from exercising voting discretion on certain proposals without specific instructions from the beneficial owner. This results in a “brokernon-vote” on the proposal. A brokernon-vote (i) is treated as “present” for purposes of determining a quorum, (ii) has the effect of a negative vote when a majority of the voting power of the issued and outstanding shares is required for approval of a particular proposal, and (iii) has no effect when a majority of the voting power of the shares present in person or by proxy and entitled to vote or a plurality or majority of the votes cast is required for approval.

Proposal 2 is deemed to be a routine matter under NYSE rules. A broker or other nominee generally may vote uninstructed shares on routine matters, and therefore no brokernon-votes are expected to occur for Proposal 2. Proposals 1, 3 4, and 54 are considerednon-routine under applicable rules. Because a broker or other nominee cannot vote without instructions onnon-routine matters, we expect an undetermined number of brokernon-votes to occur on these proposals.

SOLICITATION OF PROXIES

Valero pays the cost for soliciting proxies and the Annual Meeting. In addition to solicitation by mail, proxies may be solicited by personal interview, telephone, and similar means by directors, officers, or employees of Valero, none of whom will be specially compensated for such activities. Valero also intends to request that brokers, banks, and other nominees solicit proxies from their principals and will pay such brokers, banks, and other nominees certain expenses incurred by them for such activities. Valero retained Georgeson LLC, a proxy soliciting firm, to assist in the solicitation of proxies for a fee of $17,500, plus reimbursement of certainout-of-pocket expenses.

For participants in our qualified 401(k) plan (“Thrift Plan”), the proxy card will represent (in addition to any shares held individually of record by the participant) the number of shares allocated to the participant’s account in the Thrift Plan. For shares held by the Thrift Plan, the proxy card will constitute an instruction to the trustee of the plan on how to vote those shares. Shares for which instructions are not received may be voted by the trustee per the terms of the plan.

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Valero’s business is managed under the oversight of our Board. Our Board conducts its business through meetings of its members and its committees. During 2017,2019, our Board held sevensix meetings and the standing Board committees held 1315 meetings. No member

None of theour Board members attended less than 75 percent of the meetings of the Board and committees of which he or she was a member. All Board members are expected to attend the Annual Meeting, and all of our Board members attended the 20172019 annual meeting.

Independent Directors

Independent DirectorsDirectors.. OurCorporate Governance Guidelines require a majority of the Board to be independent. The Board presently has 10non-management directors and one member from management:management, Joseph W. Gorder (our Chief Executive Officer). As a member of management, Mr. Gorder is not an independent director under NYSE listing standards. The Board determined that all of ournon-management directors who served on the Board at any time in 2017 met2019 and who currently serve on the Board meet the Board’s independence requirements. Those independent directors were.are:

Independent CommitteesCommittees.. The Board’s Audit Committee, Compensation Committee, and Nominating/Governance and Public Policy Committee are composed entirely of directors who meet the independence requirements of the NYSE. Each member of the Audit Committee also meets the additional independence standards for Audit Committee members required by the SEC.

Independence Standards and DeterminationDetermination.. The Board determines independence on the basis of the standards specified by the NYSE, the standards listed in ourCorporate Governance Guidelines, and other facts and circumstances the Board may consider relevant. In general, ourCorporate Governance Guidelines require that an independent director must have no material relationship with Valero. A relationship is not material under the guidelines if it:

Under the NYSE’s listing standards, a director is not deemed independent unless the Board affirmatively determines that the director has no material relationship with Valero. The Board has reviewed pertinent information concerning the background, employment, and affiliations (including commercial, banking, consulting, legal, accounting, charitable, and familial relationships) of our directors, and the Board has determined that each of ournon-management directors and each member of the Audit, Compensation, and Nominating/Governance and Public Policy Committees has no material relationship with Valero, and is therefore independent.

INFORMATION REGARDING THE BOARD OF DIRECTORS

Committees ofof the Board

Our Board has three standing committees:				The committees’ charters are available on our website at:   www.valero.com u Investors u  Corporate Governance u Governance Documents u  Charters.
		Audit Committee,
		Compensation Committee, and
		Nominating/Governance and Public Policy Committee.

AUDIT COMMITTEE

The Audit Committee assists the Board in oversight of the integrity of Valero’s financial statements and public financial information, Valero’s compliance with legal and regulatory requirements, the qualifications and independence of Valero’s independent auditor, and the performance of Valero’s internal audit function and independent auditors.

The Audit Committee is directly responsible for the appointment, compensation determination, retention, and oversight of the independent auditors retained to audit Valero’s financial statements. The committee is responsible for the audit fee negotiations and fee approval associated with Valero’s retention of the independent auditing firm.

The committee annually reviews and evaluates the qualifications, performance, and independence of Valero’s independent auditing firm, and reviews and evaluates the lead partner of the independent auditor team. In conjunction with the mandated rotation of the audit firm’s lead engagement partner, the committee is involved in the selection of the audit firm’s new lead engagement partner.

The committee has oversight responsibility regarding management’s annual assessment of, and report on, Valero’s internal control over financial reporting.

The committee also oversees Valero’s initiatives and strategies respecting cybersecurity and information technology risks.

The Audit Committee met five times in 2017.2019. We make additional disclosures about the Audit Committee in this proxy statement under the caption “Risk Oversight” and in connection with “Proposal No. 2—Ratify Appointment of KPMG LLP as Independent Auditors” below.Auditors.”

COMPENSATION COMMITTEE

The Compensation Committee reviews and reports to the Board on matters related to compensation programs, policies, and strategies. The committee has direct responsibility to approve corporate goals and objectives relevant to CEO compensation, evaluate the CEO’s performance in light of those goals and objectives, and together with the other independent directors, determine and approve the CEO’s overall compensation. The committee also reviews and approves the corporate goals and objectives relevant to the compensation of other senior executives of Valero.

The committee conducts periodic reviews of director compensation and makes recommendations to the full Board regarding the independent directors’ compensation.

The committee reviews Valero’s employee compensation policies and programs, adopts and reviews Valero’s equity compensation plans, oversees the administration of Valero’s compensation plans, and approves amendments to and interpretations of Valero’s compensation plans.

As disclosed further below under the caption “CEO Succession Planning,” the committee reviews and makes regular reports to the Board regarding management succession planning for the CEO and other senior executives. The committee also exercises oversight over Valero’s initiatives and strategies in the areas of diversity, inclusion, and human capital.

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INFORMATION REGARDING THE BOARD OF DIRECTORS

The Compensation Committee’s duties are further described in “Compensation Discussion and Analysis” below and in the committee’s charter.

The Compensation Committee met fiveseven times in 2017.2019. The Compensation Committee has, for administrative convenience, delegated authority to our Chief Executive Officer to makenon-material amendments to Valero’s benefit plans and to make limited grants of stock options and restricted stockequity awards to new hires who are not executive officers.

Compensation Committee Interlocks and Insider Participation:Participation: There are no compensation committee interlocks. None of the members of the Compensation Committee has served as an officer or employee of Valero or had any relationship requiring disclosure by Valero under Item 404 of the SEC’sRegulation S-K, which addresses related-person transactions.

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INFORMATION REGARDING THE BOARD OF DIRECTORS

Selection of Director Nominees

The Nominating/Governance and Public Policy Committee solicits recommendations for Board candidates from a number of sources, including our directors, our officers, individuals personally known to our Board members, and third-party research. In addition, the Committee will consider candidates submitted by stockholders when submitted in accordance with the procedures described in this proxy statement under the caption “Miscellaneous—Stockholder Communications, Nominations, and Proposals.”

The Committee will consider all candidates identified through the processes described above and will evaluate each of them on the same basis. The level of consideration the Committee will extend to a stockholder’s candidate will be commensurate with the quality and quantity of information about the candidate that the nominating stockholder makes available to the Committee.

Proxy AccessAccess.. Our amended and restated bylaws permit a stockholder, or a group of up to 20 stockholders, that has owned at least three percent of our outstanding Common Stock for at least three years to nominate and include in our proxy statement candidates for our Board, subject to certain requirements. Each stockholder, or group of stockholders, may nominate candidates for director, up to a limit of the greater of two or 20 percent of the number of directors on the Board. Any nominee must meet the qualification standards listed in our bylaws. The procedures for nominating a candidate pursuant to our proxy access provisions are described in this proxy statement under the caption “Miscellaneous—Stockholder Communications, Nominations, and Proposals.”

EVALUATION OF DIRECTOR CANDIDATES

TheOurCorporate Governance Guidelines vest the Nominating/Governance and Public Policy Committee is charged with (i) assessing the skills and characteristics that candidatesresponsibility for election to the Board should possess and (ii) determiningreviewing the composition of the Board as a whole.well as the qualifications of the individual members of the Board and its various committees. This review includes consideration of the directors’ independence, character, judgment, integrity, diversity, age, skills (including financial literacy) and experience in the context of the overall needs of the Board. The Committee’s assessments include consideration of:

INFORMATION REGARDING THE BOARD OF DIRECTORS

operations and future of Valero based on their experience with and understanding of Valero’s history, policy, and objectives. As an alternative to term limits, the Board believes that its evaluation and nomination processes serve as an appropriate check on each Board member’s continued effectiveness.

Retirement Policy. Our directors are subject to a retirement policy (set forth in Article I of ourCorporate Governance Guidelines). Under that policy, a director may serve on our Board until he or she reaches the age of 75. A director who turns 75 may serve the remainder of his or her term of office, which shall be deemed to end at the next annual meeting of stockholders at which directors are elected.

Director Continuing Education

We encourage our directors to attend director education programs as appropriate to stay abreast of developments in corporate governance and board best practices. Valero’sCorporate Governance Guidelines state that Valero will pay for our directors’ attendance at continuing education seminars, conferences, or workshops to foster education in matters pertaining to corporate governance or directors’ responsibilities generally, and that Valero will pay for a director’s membership in an organization such as the National Association of Corporate Directors in order to provide ongoing resources for board development.

Board Evaluation Process

OurCorporate Governance Guidelines and the charters of each of the Board’s committees require the Board and the committees to conduct an annual performance evaluation. The Nominating/Governance and Public Policy Committee oversees the Board and committee self-evaluation process.

At the end of each year, the directors complete detailed surveys designed to evaluate the performance of the Board and each of its standing committees. The surveys seek feedback on, among other things, Board and committee composition, the frequency and content of Board and committee meetings, the quality of management’s presentations to the Board and the committees, the adequacy of the committees’ charters, and the performance of the Board and the committees in light of the responsibilities of each as established in theCorporate Governance Guidelines and the committees’ charters. Summary reports of the evaluation results are compiled and provided to each director. The summary reports are discussed at Board and/or committee meetings in executive session, led by the Chair of the Nominating/Governance and Public Policy Committee, the Lead Director, and/or the Chairman of the Board, all of whom ensure that the Board or senior management, as appropriate, follow up on any identified areas for improvement.

In addition to the annual self-evaluation process, the Chair of the Nominating/Governance and Public Policy Committee, the Lead Director, and/or the Chairman of the Board will meet from time to time with each director individually, either in-person or via teleconference, in order to obtain feedback on the performance of the Board, a committee, or an individual director. The Board believes that all of these evaluation tools provide effective measures and forums for discussing the Board’s effectiveness and potential areas for improvement.

Leadership StructureStructure of the Board

Our bylaws providestate that the Chairman of the Board has the power to preside at all meetings of the Board. Joseph W. Gorder, our Chief Executive Officer, serves as the Chairman of the Board. Although the Board believes that the combination of the Chairman and Chief Executive Officer roles is appropriate in current circumstances, Valero’sCorporate Governance Guidelines do not establish this approach as a policy, and in fact, the Chairman and Chief Executive Officer roles were separate from 2005–2007 and from May–December 2014.

The Chief Executive Officer is appointed by the Board to manage Valero’s daily affairs and operations. We believe that Mr. Gorder’s extensive industry experience and direct involvement in Valero’s operations make him best suited to serve as Chairman in order to:

INFORMATION REGARDING THE BOARD OF DIRECTORS

Oversight by Independent DirectorsDirectors.. Our Board structure includes strong oversight by independent directors. Mr. Gorder is the only member from our management (past or present) who serves on the Board; all of our other directors are independent. Each of the Board’s committees is chaired by an independent director, all committee members are independent, and our Board has named an independent Lead Director whose duties are described in the following section.

Lead Director and Meetings ofNon-Management Directors

Our Board appointsindependent directors appoint a Lead Director whose responsibilities include leading the meetings of ournon-management directors outside the presence of management. Following the recommendation of the Nominating/Governance and Public Policy Committee, the BoardBoard’s independent directors selected Robert A. Profusek to serve as Lead Director during 2018. He also served as Lead Director in 2017.2020. Our Board regularly meets in executive session outside the presence of management, generally at each Board and committee meeting, as led by Mr. Profusek.meeting.

The Lead Director, working with the committee chairs,Chairs, sets agendas and leads the discussion of regular meetings of the Board outside the presence of management, provides feedback regarding these meetings to the Chairman, and otherwise serves as liaison between the independent directors and the Chairman. The Lead Director regularly communicates with the Chairman between meetings of the Board to discuss policy issues, strategies, governance, and other matters that arise throughout the year. The Chairs of the Board’s committees also communicate regularly with the Lead Director to discuss policy issues facing Valero and the Board and to recommend agenda items for consideration at future Board meetings. The Board believes that this approach appropriately and effectively complements Valero’s combined Chief Executive Officer/Chairman structure.

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INFORMATION REGARDING THE BOARD OF DIRECTORS

The Board also discusses significant risks at the Board’s annual strategic planning meeting. In addition to receiving and discussing reports from management in strategic planning sessions, the Board is also able to interact with third-party experts who are invited to make presentations to the Board on risks facing Valero and its businesses.

The oversight of risk is shared between the full Board and its committees. The full Board (or appropriate Board committee) regularly receives reports from management to enable the Board (or committee) to assess Valero’s risk identification, risk management, and risk mitigation strategies. When a report is vetted at the committee level, the chairChair of that committee thereafter reports on the matter to the full Board. This enables to the Board and its committees to coordinate the Board’s risk oversight role. The Board also believes that risk management is an integral part of Valero’s annual strategic planning process, which addresses, among other things, the risks and opportunities facing Valero in the long term.

One of the Audit Committee’s responsibilities is to discuss with management Valero’s major financial risk exposures and the steps Valero has taken to monitor and control those exposures, including our risk assessment and risk management policies. In this regard, our chief audit officer prepares a comprehensive risk assessment report and reviews that report with the Audit Committee. This report identifies material business risks for Valero and identifies Valero’s internal controls that respond to and mitigate those risks. Valero’s management regularly evaluates these controls, and the Audit Committee is provided regular updates regarding the effectiveness of the controls. The Audit Committee also has oversight responsibility regarding management’s annual assessment of, and report on, Valero’s internal control over financial reporting. In addition, senior managementValero’s Chief Information Officer reports regularly to the Audit Committee regarding Valero’s initiatives and strategies respecting cybersecurity and information technology risks.

Our Nominating/Governance and Public Policy Committee reviews our policies and performance in areas of employee and contractor health and safety, environmental compliance, governmental affairs, reputation management, climate-related risks and opportunities, political contributions, and policy matters generally. Valero’s President & COO (Mr. Riggs) and EVP & General Counsel and the Vice President Public Policy & Strategic Planning(Mr. Fraser) attend all meetings of the Committee. In addition, members from senior management report at least annually,regularly to the Committee regarding Valero’s health, safety and environmental risks, strategies, and assessments. The Committee also assists the Board in oversight of Valero’s disclosure of climate-related risks and opportunities (described(as described further in “Climate Change Disclosure” below).

Our Compensation Committee assesses the risk of our compensation programs. Our compensation consultant regularly attends meetings of the Committee to provide updates on compensation related risks and trends. See also, “Risk Assessment of Compensation Programs” elsewhere in this proxy statement.

Engagement Process

Ongoing engagement with our stockholders is important to us. We communicate with our stockholders through a variety of means, including direct interface, investor presentations, our website, and publications we issue. As part of our engagement program, our senior management team reaches out to our stockholders for dialogue concerning their priorities – which may include our strategy, company culture, environmental initiatives, financial performance, capital allocation, executive compensation, climate-related risks and opportunities, and/or corporate governance. We value our stockholders’ views and their input is important.

Our ESG, Compliance, Investor Relations, and Legal teams are dedicated to leading our engagement efforts and collaborating with Valero’s management teams and subject matter experts (SMEs) in order to provide appropriate resources for engagement with our stockholders. The chairs of our Compensation Committee and Nominating/Governance and Public Policy Committee have also participated in our engagements with stockholders.

Our engagements with stockholders have been constructive and have provided management and the Board with insights on issues and initiatives that are important to our stockholders and other stakeholders. We initiate formal outreach efforts in the months prior to our annual meeting of stockholders. Through that process, we contact stockholders and invite them to engage in discussions with our management team and SMEs on a variety of topics, including the stockholders’ priorities and interests, our proxy statement disclosures, stockholder proposals, company strategy, and ESG matters. Following our annual meeting, our engagement efforts continue so that we may follow up on matters brought to our attention and/or discuss new issues of interest. Procedures for communicating with us are stated in “Stockholder Communications, Nominations, and Proposals” elsewhere in this proxy statement.

The following graphic depicts the ongoing elements of our engagement process.

As part of our engagement process in 2019, we contacted our 60 largest stockholders – representing over 60% of our outstanding common shares – offering to discuss our proxy statement disclosures and proposals as well as a wide range of matters of interest to our stockholders (e.g., climate-related risks and opportunities). We also respond routinely to individual stockholders and other stakeholders who inquire about our business.

Input from our stockholders helps us formulate an appropriate action plan for addressing certain issues. The publication of our climate report(Climate-Related Risks and Opportunities) was strongly influenced by our previous engagements with stockholders and stakeholders. In 2019, after receiving input from our stockholders, ourStewardship and Responsibility Report was revamped to provide information and data that meet our stockholders’ priorities and needs. Also in 2019, we made changes to elements of our compensation program as a result of our engagement with stockholders. Those changes are described in “Compensation Discussion and Analysis – Dialogue with Stockholders.”

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In 2017 the Financial Stability Board’s Task Force on Climate-related Financial Disclosure (TCFD) issued its final recommendations on reporting climate-related financial information. In September 2018, Valero is presently at work preparing drafts of apublished its climate report—with ongoingunder Board oversight led by the Nominating/Governance and Public Policy Committee—that is aligned with the main principles outlined in the recommendations of the TCFD. We planThe report is published on our website at www.valero.com > About Valero > Corporate Responsibility > Climate-Related Risks and Opportunities.

Per the Board’s Nominating/Governance and Public Policy Committee charter, the committee reviews and discusses with management, at least annually, Valero’s strategy and performance in assessing and responding to includeclimate-related risks and opportunities.

Valero’s Climate-Related Risks and Opportunities report is not a part of this proxy statement. The report is not “soliciting material,” is not deemed filed with the resultsSEC, and is not to be incorporated by reference into any of Valero’s filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this proxy statement and irrespective of any general incorporation language therein.

In ourStewardship and Responsibility Report, we make disclosures on a stress-testvariety of environmental, social, and governance (ESG) topics of interest to our business againststakeholders. The report covers the International Energy Agency’s hypothetical 450 Scenario (also knownfollowing areas of interest:

The report is published on our website at www.valero.com > About Valero > Corporate Responsibility > Stewardship and Responsibility Report.

Valero’s Stewardship and Responsibility Report is not a part of this proxy statement. The report is not “soliciting material,” is not deemed filed with the SEC, and is not to be incorporated by reference into any of Valero’s filings under the Securities Act of 1933, as amended, or the “2 degree scenario”). FollowingSecurities Exchange Act of 1934, as amended, whether made before or after the full Board’s final reviewdate of the report, we expect to publish our report in the third quarterthis proxy statement and irrespective of 2018.any general incorporation language therein.

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      (ITEM 1 ON THE PROXY CARD)

Majority VotingVoting.. Under our bylaws, each director is to be elected under this proposal will be elected by the vote of the majority of the votes cast at the Annual Meeting, if a quorum is present.Meeting. For this purpose, a “majority of the votes cast” means that the number of shares voted “for” a director’s election exceeds 50 percent of the number of votes cast with respect to that director’s election. Votes “cast” exclude abstentions. If any nominee is unavailable as a candidate at the time of the Annual Meeting, either the number of directors constituting the full Board will be reduced to eliminate the resulting vacancy, or the persons named as proxies will use their best judgment in voting for any available nominee.

Information Concerning Nominees and Directors

Each of the following is a nominee for election as a director at the Annual Meeting. There is no family relationship among any of the executive officers or nominees for director. There is no arrangement or understanding between any director or any other person pursuant to which the director was or is to be selected a director or nominee. Susan Kaufman Purcell, who currently serves as director, will retire from the Board on the date of the Annual Meeting.

PROPOSAL NO. 1—ELECTION OF DIRECTORS

For information regarding the nominees’ Common Stock holdings, compensation,Summary of Board Skills and other arrangements, see “Information RegardingAttributes

Our directors have an effective mix of backgrounds, knowledge, and skills. The table below provides a summary of certain collective competencies and attributes of the Board nominees. The lack of Directors,” “Beneficial Ownershipan indicator for a particular item does not mean that the director does not possess that skill or experience. We look to each director to be knowledgeable in all of Valero Securities,” “Compensation Discussionthese areas. Rather, the indicator represents that the item is a core competency that the director brings to the Board.

Our directors have a wide range of additional skills and Analysis,”experience not mentioned above, which they bring to their role as directors to Valero’s benefit, including experience in the energy industry, and “Compensation of Directors” elsewherethe technology/cybersecurity, consumer goods, human capital, corporate governance, and nonprofit leadership areas. Our directors’ skills and experience are further described in this proxy statement.the directors’ biographies on the following pages.

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PROPOSAL NO. 1—ELECTION OF DIRECTORS

Nominees.Nominees

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For information regarding the nominees’ Common Stock holdings, compensation, and other arrangements, see “Information Regarding the Board of Directors,” “Beneficial Ownership of Valero Securities,” “Compensation Discussion and Analysis,” and “Compensation of Directors” elsewhere in this proxy statement.

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The following aretable lists Valero’s executive officers (for purposes of Rule3b-7 under the Securities Exchange Act of 1934)., described below using their current titles. As used in this proxy statement, our “named executive officers” are the five persons listed in the Summary Compensation Table. There is no arrangement or understanding between any executive officer listed below or any other person under which the executive officer was or is to be selected as an officer.

Mr. Gorder. Gorder. Mr. Gorder’s biographical information is statedappears above under the caption “Information Concerning Nominees and Directors—Nominees.”

Mr. Riggswas elected President and Chief Operating Officer on Jan. 23, 2020. He previously served as Executive Vice President and Chief Operating Officer (since Jan. 1, 2018), and prior to that as Executive Vice President–Refining Operations and Engineering (since 2014), and Senior Vice President–Refining Operations (since 2011). He has held several leadership positions with Valero overseeing refining operations, crude and feedstock supply, and planning and economics. Mr. Riggs also served on the board of directors of Valero Energy Partners GP LLC (the general partner of Valero Energy Partners LP (NYSE: VLP)) from 2014 to 2019.

 BrowningMr. Fraser was elected Executive Vice President and General Counsel effective MayJan. 1, 2014. He was elected Senior Vice President and General Counsel in November 2012. He previously2019. Prior to that, he served as Senior Vice President–Corporate LawPresident overseeing Valero’s Public Policy & Strategic Planning, Governmental Affairs, Investor Relations, and SecretaryExternal Communications functions (from May 2018). From Nov. 2016 to May 2018, Mr. Fraser served as Vice President-Public Policy & Strategic Planning, and from 2006May 2015 to 2012. Mr. Browning was electedNov. 2016, he served in London as Vice President-Europe, overseeing Valero’s European commercial businesses. Prior to his service in London, he served in Valero’s San Antonio headquarters as Senior Vice President of Valero in 2002, and was first elected as Secretary in 1997. He also serves as Executive Vice President and& Deputy General Counsel of Valero Energy Partners GP LLC.Services, Inc. (2013 to 2015). Prior to that, he held various leadership roles with Valero, including Senior Vice President-Specialty Products of Valero Marketing and Supply Company.

Mr. Simmons Ciskowski has served as Executive Vice President and Chief Financial Officer of Valero since August 2003. Before that, he served as Executive Vice President–Corporate Development since April 2003, and Senior Vice President in charge of business and corporate development since 2001.

Mr. Riggswas elected Executive Vice President and Chief OperatingCommercial Officer effective January 1, 2018. Prior to that, heon Jan. 23, 2020. He previously served as Executive Vice President–Refining Operations and Engineering since 2014, and Senior Vice President–Refining Operations since 2011. His previous positions included Senior Vice President–Crude, Feedstock Supply & Trading and Vice President–Refinery Planning & Economics for Valero’s refining division. Mr. Riggs also serves on the board of directors of Valero Energy Partners GP LLC.

Mr. Simmonswas elected Senior Vice President–Supply, International Operations and Systems Optimization effective(since May 1, 2014. He previously served2014), and prior to that as Vice President–Crude and Feedstock Supply and Trading from 2012(2012 to 2014,2014), and Vice President–Supply Chain Optimization from 2011(2011 to 2012.2012). Mr. Simmons joined Valero in 1987 as a process engineer and has since held many leadership positions with Valero including Vice President and General Manager of Valero’s Ardmore and St. Charles refineries.

Mr. CiskowskiMs. Titzman has elected to retire from his position as Executive Vice President and Chief Executive Officer effective May 3, 2018. The Board has electedDonna M. Titzmanserved as Executive Vice President and Chief Financial Officer to succeed Mr. Ciskowski effectivesince May 3, 2018. Ms. Titzman, age 54, has 32 years of experience with Valero. SinceFrom 2013 to May 2018, she has served as Senior Vice President and Treasurer where she hashaving responsibility for banking, cash management, customer credit, investment management, and risk management. She joinedhas also served as Chief Financial Officer and director of Valero in 1986 andEnergy Partners GP LLC (the general partner of Valero Energy Partners LP (NYSE: VLP)) from 2013 to 2019. She has held various leadership positions with Valero before being elected Treasurer in 1998, and Vice President and Treasurer in 2001. Ms. Titzman also serves as Director, Senior Vice President, Chief Financial Officer and Treasurer of Valero Energy Partners GP LLC. Ms. Titzman is a Certified Public Accountant.

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SECURITY OWNERSHIP OF MANAGEMENT AND DIRECTORS

This table lists the beneficial ownership of our Common Stock as of FebruaryFeb. 1, 2018,2020, by each nominee for director, each current director, eachall directors and nominees, the executive officerofficers named in the Summary Compensation Table, and all currentthe directors and executive officers of Valero as a group. No executive officer, director, or nominee for director owns any class of equity securities of Valero other than Common Stock. None of the shares listed below are pledged as security. The address for each person is One Valero Way, San Antonio, Texas 78249.

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BENEFICIAL OWNERSHIP OFOF VALERO SECURITIES

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

This table describes each person or group of affiliated persons known to be a beneficial owner of more than five percent of our Common Stock as of DecemberDec. 31, 2017.2019. The information is based on reports filed by such persons with the SEC.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our executive officers, directors, and greater than 10 percent stockholders to file with the SEC certain reports of ownership and changes in ownership of our Common Stock. We believe that all Section 16(a) reports applicable to our executive officers, directors, and greater than 10 percent stockholders for 2017 were filed on time.

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We believe that ourOur incentive compensation programs are designed to effectively balance risk and reward. When assessing risk, we consider both cash compensation payable under our annual incentive bonus plan as well as long-term incentives that are awarded under our stock incentive plan. We also consider the mix of award opportunities (i.e.(i.e., short- versus long-term), performance targets and metrics, the target-setting process, and the administration and governance associated with our plans. We do not believe that our compensation policies and practices are reasonably likely to have an adverse effect on Valero. Features of our compensation programs that we believe mitigate excessive risk taking include:

24		2018 PROXY STATEMENT		17

The following Compensation Committee Report is not “soliciting material,” is not deemed filed with the SEC, and is not to be incorporated by reference into any of Valero’s filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this proxy statement and irrespective of any general incorporation language therein.

COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed the following Compensation Discussion and Analysis with management. Based on the foregoing review and discussions and such other matters the Compensation Committee deemed relevant and appropriate, the Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement.

Members of the Compensation Committee:

Rayford Wilkins, Jr., Chair

Philip J. Pfeiffer

Robert A. Profusek

Compensation Discussion and Analysis—Overview

Company OverviewOverview

Valero strives to be the premier operator within the refining industrymanufacturer, distributor and marketer of transportation fuels and petrochemical products with a focus on creating value for its stockholders while serving the needs of all stakeholders.its more than 10,000 employees and neighboring communities. Sustained profitability within the fuels manufacturing and marketing business in which operating margins are primarily influenced by volatile commodity prices, requires a sound business strategy, organizational discipline, and a committed workforce. Valero’s management and employees are driven by our guiding principles in safety, environmental stewardship, community engagement, employee programs and governance.

Valero’s (i) continued significant investments in the expansion of renewable fuels production capacity, (ii) focus on safe, reliable and environmentally responsible operations, and (iii) status as an employer of choice, support Valero’s intention to be the best-in-class producer of essential fuels and products that are foundational to modern life.

COMPENSATION DISCUSSION AND ANALYSIS

Valero has three reporting segments – refining, ethanol and renewable diesel. The refining segment includes refining operations and associated marketing activities and logistics assets. Valero is the largest global independent petroleum refiner and owns refineries located in the United States, Canada and the United Kingdom. The ethanol segment includes ethanol operations and associated marketing activities and logistics assets, with plants throughout the U.S. Midwest. Valero is the world’s second-largest corn ethanol producer and sells this low-carbon fuel both domestically and internationally. Valero’s renewable diesel segment includes the operations of Diamond Green Diesel, a joint venture with Darling Ingredients Inc., producing low-carbon renewable diesel fuel at a plant in Louisiana. Diamond Green Diesel is the world’s second-largest renewable diesel producer.

VALERO’S STRATEGY FOR VALUE CREATION

18

COMPENSATION DISCUSSION AND ANALYSIS

Footnotes:

20		2020 PROXY STATEMENT		27

COMPENSATION DISCUSSION AND ANALYSIS

Valero seeks to be the leader among its peers in stockholder returns and makes operational and capital allocation decisions in support of this objective. Through targeted share buybacks and sustainable dividend growth, Valero has prioritized the delivery of cash returns to stockholders.

As a result of Valero’s performance and capital allocation decisions implemented under the current leadership team, Valero’s Total Stockholder Return¹ (TSR) leadshas outperformed the Dow Jones Index, S&P 500 Index, and all companies within the XLE² energy index constituency over the past three years.since 2014.

Footnotes:

28		2018 PROXY STATEMENT		21

COMPENSATION DISCUSSION AND ANALYSIS

Company Performance Highlights—20172019

Alignment of Executive PayPay to Company Performance

Valero’s executive pay program is designed to reward executives for superior company performance. The program design emphasizes variable incentive pay (delivered through annual and long-term incentives) such that an executive’s ultimate realizable pay is significantly dependent upon the achievement of both absolute and relative performance measures.

For purposes of describing the executive compensation programs as administered in 2019, this Compensation Discussion and Analysis references the officer positions held during 2019 for R. Lane Riggs (who served as EVP and Chief Operating Officer) and Gary K. Simmons (who served as SVP Supply, International Operations and Systems Optimization). Mr. Riggs and Mr. Simmons were each elected to new roles on Jan. 23, 2020 as more fully described under the caption, “Identification of Executive Officers.”

VALERO’S COMPENSATION PHILOSOPHY

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COMPENSATION DISCUSSION AND ANALYSIS

ELEMENTS OF EXECUTIVE COMPENSATION—SUMMARY

The primary elements of our 20172019 executive compensation program are summarized in the table below.

⬛ Fixed    ⬛ Variable

Target Total Pay

Valero’s Compensation Committee administers executive compensation such that each executive’s Target Total Pay is within a reasonable range of the most recently-available role-specific market data provided by the Committee’s independent executive compensation consultant. Target Total Pay represents in aggregate the three primary elements of our executive compensation program as listed and summarized in the prior table (Salary, Annual Incentive Bonus, and Long-term Incentives). Each element is administered independently with reference to competitive market data and with consideration of other factors as discussed further in Compensation Discussion and Analysis under the heading, “Benchmarking Competitive Pay Levels.” Target Total Pay for 2019 for our named executive officers is listed in the table below.

Footnotes:

30

COMPENSATION DISCUSSION AND ANALYSIS

The total compensation for each executive as disclosed in the Summary Compensation Table in this proxy differs from the Target Total Pay as listed in the preceding table primarily due to the following factors.

Other factors contributing to differences between the disclosed values in the Summary Compensation Table and the values shown within Target Total Pay include the actual annual bonus amount paid versus the target annual bonus value (as discussed further below under the caption, "Annual Incentive Bonus") and, for restricted stock grants, the difference between the stock price associated with the grant date fair value of the award (as required for the Summary Compensation Table disclosure) and the stock price used to determine the number of restricted shares granted in order to achieve the target value (average closing stock price for 15 days prior to grant as described previously).

Target Total Pay increased from 2018 to 2019 for the CEO and the four other Named Executive Officers (NEOs). The decrease in average NEO pay in 2018 was due to a CFO transition.

COMPENSATION DISCUSSION AND ANALYSIS

PAY FOR PERFORMANCE ALIGNMENT RELATIVE TO PEERS

The table below shows relative payperformance and performancepay versus peers over the three- and five-year periods ending 2016 (the most recent year for which both performance and disclosed2018 (results through 2019 cannot be determined until 2019 executive pay was available for all comparator companies)companies is disclosed in 2020 proxy statements). Valero’s pay results are generally aligned with TSR performance results, but realizable compensation values for executives fall at a lower percentile versus peers than does Valero’s performance.results.

Footnotes:

2
32

COMPENSATION DISCUSSION AND ANALYSIS

Footnotes (cont.):

24

COMPENSATION DISCUSSION AND ANALYSIS

STOCKHOLDER ALIGNMENT

COMPENSATION DISCUSSION AND ANALYSIS

We carefully consider the results of the most recent stockholder advisory vote on executive compensation (say-on-pay). As part of our dialogue with stockholders, we determine how the stockholders have voted on our say-on-pay proposals, and we discuss any issues of concern. Certain members of our board of directors, including the chairs of our Compensation Committee and Nominating/Governance and Public Policy Committee have participated in this outreach.

Our engagements with stockholders have provided management with the opportunity to review our executive compensation practices and explain the principles on which they were designed. Input from our stockholders through these engagements was considered by the Compensation Committee when establishing Valero’s 2020 executive compensation programs, which will include the following changes.

26

COMPENSATION DISCUSSION AND ANALYSIS

In October 2019, the Compensation Committee considered and approved changes to the Compensation Comparator Group, which was utilized in establishing 2019 LTI targets and awards as described further under the caption, “Long-term Incentive Awards.” The Compensation Committee established the new group after considering (i) companies with geographic proximity to Valero; (ii) companies within an appropriate and comparable size based on revenues and market capitalization, (iii) companies generally employing typical U.S.-based approaches to executive pay; and (iv) companies outside of the oil and gas industry that have similar organizational complexity, operational scope, and that perform similarly to Valero.

Changes to the Compensation Comparator Group include the elimination of BP p.l.c., Royal Dutch Shell plc, Hess Corporation, Marathon Oil Corporation, and Murphy Oil Corporation; the addition of ConocoPhillips, EOG Resources, Inc., Halliburton Company, Occidental Petroleum Corporation, Dow Inc., Ford Motor Company, and General Motors Company. Marathon Petroleum Corporation, Phillips 66, Chevron Corporation, Exxon Mobil Corporation, and HollyFrontier Corporation were retained as peer companies.

Our compensation and benefits staff, under supervision of the Compensation Committee, develops recommendations for base salary, bonuses, and other compensation arrangements using the compensation survey data with assistance from Exequity. Our use of the data is consistent with our philosophy of providing executive compensation and benefits that are competitive with companies that we compete with for executive talent. In addition, the competitive compensation survey data and analyses assist the Compensation Committee in assessing our pay levels and targets relative to companies in theCompensation Comparator Group. See “Elements of Executive Compensation—Benchmarking Competitive Pay Levels” below.Levels.”

Performance Peer Group

We also use a peer group for purposes of determining the relative performance of Valero’s total stockholder return (TSR). We use this relative TSR metric in our performance shares incentive program. For the 2017The 2019 performance peer group companies werewas selected based on theirthe members’ engagement in U.S. domestic refining and marketing operations.operations or due to the members’ strong stock price correlation to Valero.

Our use of different peer groups for compensation and performance is based on the following. While job candidacy can transcend company size, we believeour belief that when measuring business performance, companies with a similar business model should be included. But we also recognize that comparing the performance of Valero’s generallynon-integrated operations with those of upstream and integrated oil companies can result in anomalies due to the mismatch in how similar industry-specific events can impact companies with these varying business models. In addition, there are relatively few companies in our business against which clear comparisons can be drawn, rendering a peer group composition more challenging than in most industries.

COMPENSATION DISCUSSION AND ANALYSIS

competitive survey data and other factors described in this Compensation Discussion and Analysis, and adjustments may be made based upon the independent directors’ evaluation of the Chief Executive Officer’s performance and contributions.

We evaluate the total compensation opportunity offered to each executive officer at least once annually. The Compensation Committee establishes the target levels of annual incentive and long-term incentive compensation for the current fiscal year based upon its review of competitive market data provided by Exequity. The Compensation Committee also reviews competitive market data for annual salary rates for executive officer positions for the next fiscal year and recommends new salary rates to become effective the next fiscal year. The Compensation Committee may, however, review salaries or grant long-term incentive awards at other times during the year because of new appointments or promotions. Our Compensation Committee does not time the grants of long-term incentive awards around Valero’s release of undisclosed material information.

In January 2020 the Compensation Committee approved a change to the timing of the annual grant of long-term incentive awards to executive officers. In 2019 and prior years, annual grants were administered in the fourth quarter in conjunction with the annual review of executive compensation. Beginning in 2020, annual grants of long-term incentive awards are now administered in the first quarter to better align with market practices and to more closely coincide with base salary changes, which typically occur effective January 1. The 2020 annual long-term incentive awards for executive officers were administered in February 2020.

Elements of Executive Compensation

Our executive compensation programs include the following material elements:

We chose these elements to foster the potential for both current and long-term compensation opportunities and to attract and retain executive talent. We believe that variable pay (i.e.(i.e., annual incentive bonus and long-term equity-based incentives that do not become a permanent part of base salary)—when delivered through appropriate incentives—is ultimately the best way to drive total compensation among our executive officers.

We believe that a significant portion of the compensation paid to our named executive officers should be incentive-based and determined by both company and individual performance. Our executive compensation program is designed to accomplish the following long-term objectives:

We believe that superior performance is motivated when an executive’searn-out of his or her full compensation opportunities is contingent on achieving performance results that exceedpre-established goals and/or outperforming our industry peers.

Our annual incentive program rewards are tied to:

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COMPENSATION DISCUSSION AND ANALYSIS

Our annual incentive program rewards are tied to:

Our long-term equity incentive awards are designed to tie the executive’sexecutives’ financial reward opportunities with increased stockholdersstockholder value creation as measured by:

Base salary is designed to provide a fixed level of competitive pay that reflects the executive officer’s primary duties and responsibilities, and to provide a base upon which incentive opportunities and benefit levels are established.

The long-term incentive awards in our compensation program include performance shares and restricted stock. We believe that incentives that drive stockholder value should also drive executive officer pay. We note that performance shares, when issued, do not assure a payout to the executive officer unless and until stockholder value is created through both company performance and TSR relative to our peers. We also believe that executive officers should hold an equity stake in the company to further motivate the creation of stockholder value, which is why we include awards of restricted stock in our long-term incentive program coupled with stock ownership guidelines.

BENCHMARKING COMPETITIVE PAY LEVELS

Our Compensation Committee benchmarks base salaries for our named executive officers against the 50th percentile (median) of competitive survey data and may make decisions to pay above or below this target based on individual circumstances (e.g.(e.g., performance of the executive, internal parity, and management succession planning).

We also benchmark annual bonus, long-term incentive targets (expressed as a percentage of base salary), and total targeted pay for each executive position by reference to the 50th percentile (median) benchmark of the Compensation Comparator Group, and may make decisions to award above or below these targets based on individual circumstances (e.g.(e.g., performance of the executive, internal parity, and management succession planning). We believe that preservingPreserving flexibility to award incentive opportunities above or below the median peer levels helps tailor the incentives to the executive and the role, resulting in a more customized match of competitive pay opportunities andpay-for-performance design attributes.

In addition to benchmarking competitive pay levels to establish compensation levels and targets, we also consider the relative importance of a particular management position in comparison to other management positions in the organization. In this regard, when setting the level and targets for compensation for a particular position, we evaluate that position’s scope and nature of responsibilities, size of business unit, complexity of duties and responsibilities, as well as that position’s relationship to managerial authorities throughout the management ranks of Valero.

RELATIVE SIZE OF MAJOR COMPENSATION ELEMENTS

An executive officer’s total direct compensationTotal Target Pay is structured so that realizing the targeted amount is highly contingent on Valero’s performance due to the executive’s level ofat-risk pay. We use the term “total direct compensation”“Total Target Pay” to refer to the sum of an executive’s base salary, targeted incentive bonus, and the target values of long-term incentive awards.

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COMPENSATION DISCUSSION AND ANALYSIS

The following chartsgraphics summarize the relative target valuespay mix of base salary and incentive compensation for 20172019 for our named executive officers.