ESG Report - Report - Page 69
STRATEGY
LOW-CARBON
ENVIRONMENT
SAFETY
COMMUNITY
PEOPLE
GOVERNANCE
Comprehensive Liquid Fuels Strategy
We are working to advance the future of energy with capital discipline, innovation and unmatched execution.
We support our commitment to stockholder returns with our comprehensive liquid fuels strategy that drives
economic growth projects and provides a viable path to reduce GHG emissions.
Operations
Capital Discipline
Unmatched Execution with a Proven History of
Operational Excellence
• Safe, reliable, environmentally responsible operations
driving higher profitability and lower earnings
volatility.
• The lowest-cost producer among peer group while
maintaining first-quartile operating performance.
Demonstrated Commitment to Stockholders
• Disciplined capital allocation with solid free
cash flow and returns to stockholders across
margin cycles.
• Delivered on our target payout ratio of 40%
to 50% of adjusted net cash provided by
operating activities.
• Applying liquid fuels manufacturing expertise to
optimize our low-carbon fuels businesses.
Earnings Growth
Executive Compensation
Growth Through Innovation
• Growth projects focused on operating cost control,
market expansion and margin improvement.
• Leveraging our global liquid fuels platform to
expand our long-term competitive advantage with
investments in economic low-carbon projects.
• Minimum 25% after-tax IRR hurdle rate has applied
to all growth projects.
Alignment of Executive Pay with Company Performance
and Long-Term Stockholder Value Creation
• Link of superior company performance and
executive pay.
• Link of ESG and climate-related goals and
executive pay.
• Alignment of interests of executives and stockholders.
• Risk management and adoption of best practices in
executive pay.
• Balance of compensation over short- and long-term
periods.
• Retention of top executive talent.
Valero is a constituent of 49 ESG indices37
FTSE All-World
Ex CW Climate
Balanced
Factor Index
FlexShares STOXX US
ESGSelect Index
MSCI USA ESG Leaders
Index
S&P 500 ESG Index
MSCI World Low Carbon
Index
JUST Capital U.S. Large
Cap Diversified Index
Concinnity Conscious
Companies Index
Inspire Global
Hope Large Cap Equal
Weight Index
Northern Trust ESG &
Climate
US Large Cap Core Index
ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT •
69
