ESG Report - Report - Page 74
Our Responsiveness to
Engagement
As part of our engagement efforts, we proactively offer
dialogue to stockholders and stakeholders regarding
different matters, such as executive compensation,
ESG, sustainability, proxy proposals, climate-related
risks and opportunities, GHG emissions targets,
environmental justice and community engagement
efforts, human capital management, and political
and lobbying activities. The robust ESG/compensation
engagement efforts we undertook over the course of
2022 consisted of the following:
• Offering dialogue to our 100 largest stockholders;
• Holding at least 55 different meetings with
stockholders and proxy advisory firms; and
• Engaging with stockholders that held approximately
50% of our outstanding shares of common stock.38
In 2022 and early 2023, in response to stockholder and
stakeholder feedback, the following disclosures and/
or changes were made:
• Relative TSR performance target for Valero’s
performance shares was prospectively set above
the median of the peer group for future grants of
performance shares.39
• A cap on overall performance share payouts at 100%
of target, when Valero’s TSR over the performance
period is negative, will be applied to future grants of
performance shares.
• Stock Ownership and Retention Guidelines were
enhanced by increasing the required value of Valero
Common Stock owned by senior executives as a
multiple of salary by 50% above previous levels.40
• Scope 3 intensity disclosure.
• Value chain analysis.
• TCFD Report (IEA Net Zero by 2050).
• Third-party assurance on Scope 1, Scope 2 and
Scope 3 Intensity disclosures as well as low-carbon
fuels displacements and the evaluation of our 2035
GHG emissions target.
• 2023 Environmental Justice Audit Report and Racial
Equity Assessment.
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Political Engagement
Valero believes that constructive participation
in the political process is an important means of
enhancing stockholder value and promoting good
corporate citizenship.
• Board Oversight — The CEO and the General
Counsel review and approve recommendations
by Valero’s government affairs team on political
contributions and lobbying activities. Additionally,
the Sustainability and Public Policy Committee is
responsible for assisting the Board with oversight
of Valero's political contributions and lobbying
activities and receives, at least once annually,
a formal report from management on these
activities.
• Policy Advocacy — As part of our engagement,
we may advocate directly or with trade
associations on issues that affect our business
and the energy industry. Our trade association
participation focuses on being an active member
of business communities where we work and live,
learning and sharing best practices from safety
and environmental to labor and technologies,
as well as promoting dialogue and advocacy
for positions that are in the best interest of our
business.
• Climate-lobbying Alignment Analysis — We
conducted a review of climate lobbying activities
and concluded that certain trade associations
with lobbying activities were substantially
aligned with, or were in the process of aligning
with, Valero’s vision of providing affordable
and sustainable energy, while reducing GHG
emissions.
• Political Participation — Valero complies
with all applicable laws and regulations when
considering participation in the political process
with corporate contributions.
Our political participation webpage provides
comprehensive and updated political disclosures:
www.valero.com > Investors > ESG > Political
Engagement > Political Participation.
