TABLE OF CONTENTS

Notice of 2022 Annual Meeting of Shareholders	1
Letters from Leadership	3
Performance Highlights	5
2021 Operational and Financial Highlights	5
Corporate Responsibility and Sustainability	7
Human Capital Management	9
Proxy Summary	10
Corporate Governance Highlights	10
Shareholder Outreach and Responsiveness	11
Board Highlights	12
Pay for Performance	14
Responding to Shareholder Feedback on Pay	14
Compensation Snapshot	15
Proposal 1: Election of Directors	17
Directors Standing for Election	17
Continuing Directors	19
Board Skills and Experience	23
Director Qualifications and Nomination Process	24
Board Independence	26
Corporate Governance	27
Board Leadership Structure	27
Board Committees	28
Shareholder Outreach and Responsiveness	30
Board Oversight of Our Company	33
Community Involvement and Engagement	35
Meetings and Attendance	36
Board Education	36
Related Party Transactions	36
Director Compensation	37
Objectives and Principles	37
Director Compensation Table	39
Proposal 2: Advisory Approval of Executive Compensation	40
Compensation Discussion and Analysis	41

Executive Compensation Tables	69
Summary Compensation Table	69
Grants of Plan-Based Awards	72
Outstanding Equity Awards at Fiscal Year End	73
Option Exercises and Stock Vested for 2021	75
Pension Benefits as of December 31, 2021	75
Nonqualified Deferred Compensation	77
Potential Payments Upon Termination or Change in Control	78
CEO Pay Ratio	81
Equity Compensation Plan Information	82
Proposal 3: Ratification of the Appointment of Ernst & Young	83
Ernst & Young LLP Fees	83
Audit and Finance Committee Report	84
Proposal 4: Approval of 2022 Omnibus Stock and Performance Incentive Plan of Phillips 66	86
Shareholder Proposals	93
Proposal 5: Shareholder Proposal Regarding GHG Emissions Targets	94
Proposal 6: Shareholder Proposal Regarding Report on Shift to Recycled Polymer for Single Use Plastics	98
Beneficial Ownership of Phillips 66 Securities	102
Securities Ownership of Certain Beneficial Owners	102
Securities Ownership of Officers and Directors	103
Additional Information	105
About the Annual Meeting	105
Virtual Meeting Information	109
General Information	110
Proxy Solicitation	110
Householding	111
Submission of Future Shareholder Proposals and Director Nominations	111
Appendices	112

Letters from Leadership

From Our Chairman of the Board and CEO

Dear Fellow Shareholders,

Phillips 66 continued recovering from the impacts of the pandemic in 2021 and made significant progress advancing lower-carbon initiatives. We continued to honor our vision and values by keeping our people safe, providing energy and improving lives. We remained focused on our strategic priorities: growth, returns and distributions supported by a strong foundation of operating excellence and a high-performing organization. We take great pride in maintaining our commitments:

On a final note, we believe as economic conditions show signs of improving there will be further opportunities for value creation across our traditional business lines and emerging energy opportunities. To ensure everyone’s health and well-being, the 2022 Annual Meeting will be held exclusively online. You can find information about how to attend in the attached Proxy Statement.

Thank you for your continued support and investment in Phillips 66.

In safety, honor and commitment,

Greg C. Garland Chairman and CEO March 31, 2022

From Our Lead Director

Dear Fellow Shareholders,

The independent directors and I join Greg in inviting you to attend our Company’s 2022 annual meeting of shareholders. The Board values input from our shareholders as the Company continues to execute our long-term strategy. As the Board’s Lead Independent Director, I meet regularly with investors. During most of those meetings, I am joined by the chair of our Human Resources and Compensation Committee, Dr. Marna Whittington. The input and feedback we receive from our investors are shared with the entire Board, which considers these viewpoints in our discussions and decisions.

We appreciate the diversity of concerns that are of interest to you, our shareholders. We heard interesting perspectives on the compensation of our executives and the metrics used in our compensation programs, GHG emissions reduction and other environmental issues, and human capital matters, among others. We think you will see in our various public disclosures that we take these perspectives seriously and attempt to address them through changes to our compensation programs and providing additional disclosures.

I encourage you to read our 2022 Proxy Statement, our 2021 Annual Report on Form 10-K, and the other proxy materials. I also encourage you to read our 2021 Sustainability Report and our 2021 Human Capital Management Report, both of which are available on the Company website.

Our Board remains committed to building long-term value in the Company and returning excess capital to our shareholders. We are also committed to guiding our Company to help address climate change through setting impactful, attainable and measurable emissions reduction targets, and investing in technologies that deliver lower-carbon solutions. On behalf of the directors, I join Greg and the entire executive management team in thanking you for choosing to invest in Phillips 66.

It is a great pleasure to serve as your Lead Independent Director, and I look forward to hearing from many of you in the coming year.

Sincerely, Glenn Tilton Lead Director March 31, 2022

Performance Highlights

In 2021, Phillips 66’s management and employees exemplified the Company’s commitment to Operating Excellence, enabling the Company to recover following the uncertainties and challenging market conditions caused by COVID-19. Phillips 66 maintained its commitment to long-term capital discipline and was able to invest in the business, return cash to shareholders, and pay down debt as the Company experienced increased recovery in the back half of the year. A significant portion of 2022 growth capital invested in our business supports lower carbon opportunities, and we will continue to prioritize our investments in lower-carbon opportunities as we strive to meet the world’s changing energy needs.

	Operating Excellence
	Committed to safety, environmental stewardship, sustainability, reliability and cost efficiency while protecting shareholder value ·   Maintained strong industry-leading personal safety performance ·   Achieved best-ever Tier 1 and 2 process safety event rate ·   Established Greenhouse Gas emissions reduction targets

Growth

Enhancing our portfolio by growing our integrated Midstream and Chemicals businesses, as well as executing our returns-focused low-carbon strategy in Emerging Energy ·   Delivered record Midstream and CPChem pre-tax income ·   Completed C2G Ethane Pipeline project and advanced construction of Sweeny Frac 4 ·   Began production of renewable diesel at the San Francisco Refinery ·   Invested in renewable feedstocks and the battery value chain

	Returns
	Improving returns by investing to optimize and enhance existing assets ·   Delivered record Marketing & Specialties pre-tax income ·   Acquired approximately 200 retail sites via US JV; upgraded 1,000+ sites globally ·   Advanced renewable fuels placement strategy

	Distributions
	Committed to maintaining financial strength and disciplined capital allocation to reward shareholders through continued dividend growth and share repurchases ·   Returned $1.6 B in dividends to shareholders ·   Increased dividend ·   Paid down $1.5 B of debt

High-Performing Organization

Building capability, pursuing excellence, and doing the right thing ·   Realized improvements in employee engagement, manager effectiveness and performance enablement ·   Advanced leader-led Inclusion & Diversity efforts ·   Recognized externally as a great place to work ·   Continued to support local communities where we operate ·   Continued to leverage digital advancements enabling the work force of the future

NON-GAAP FINANCIAL MEASURES

Please note that the discussion of our results in this proxy statement contains references to “adjusted earnings,” “adjusted EPS,” “adjusted EBITDA - as used in VCIP,” “Absolute ROCE,” “relative ROCE,” “adjusted ROCE - as used in PSP,” “net debt-to-capital ratio,” and “adjusted controllable costs as used in VCIP.” These are not measures of financial performance under GAAP and may not be defined and calculated by other companies using the same or similar terminology. Please see Appendix B for the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measure.”

CORPORATE RESPONSIBILITY AND SUSTAINABILITY

Our vision is to provide energy and improve lives, which we reinforce through our core Company values of safety, honor and commitment. Operational, financial, social and environmental sustainability is at the heart of how we deliver on our vision, all of which is anchored on a strong foundation of corporate governance. These tenets define our approach to progressing a sustainable future. Through strong operating excellence, we are committed to safety, reliability and environmental stewardship while delivering shareholder value.

We also are committed to achieving a high-performing organization that is focused on culture, inclusion and diversity, as well as strengthening community through volunteerism, financial support, and engagement, including community awareness and education. Examples of our commitment in action during 2021 include: 

Our Approach to Sustainability

Sustainability is integral to our corporate strategy and designed to ensure a resilient portfolio. Our strategy is clear and consistent: operating excellence, growth, returns, distributions delivered through a high-performing organization. This strategy ensures a sustainable, viable business and creates long-term shareholder value.

Stakeholder Engagement

Stakeholder relationships have always been a priority for us. They enable us to fulfill our purpose and execute our strategy. Our stakeholders include employees, shareholders, investors, customers, communities where we operate, indigenous people, legislators and energy consumers.

We approach our stakeholder engagement from a position of mutual respect, respecting human rights, demonstrating our values through our actions and being a good neighbor. We conduct our operations in compliance with all applicable laws, in accordance with our Company values and policies, and consistent with the spirit of the United Nations’ Universal Declaration of Human Rights. Our processes provide a measured and responsive approach to stakeholder engagement.

Spotlight on Climate Change/Energy Transition

Phillips 66 supports the ambitions of the Paris Agreement and is active in the energy transition while continuing to provide affordable, reliable, and abundant energy that drives human progress. In 2021, Phillips 66 announced its intention to reduce greenhouse gas (GHG) emissions intensity from our operations and energy products by 2030, setting impactful, attainable and measurable targets. The Company plans to reduce Scope 1 and Scope 2 emissions intensity from operations by 30% and Scope 3 emissions intensity of its energy products by 15%, below 2019 levels. Earlier this year, we announced a 2050 target to further reduce Scope 1 and Scope 2 emissions intensity by 50% below 2019 levels. Details on the projects planned and in development to achieve these targets can be found on the sustainability section of our website.

In furtherance of the evolving energy economy, the Company formed an Emerging Energy organization that is focused on developing a lower-carbon sustainable business platform by leveraging our existing assets and capabilities and advancing investments in new energy technologies. Our Emerging Energy

focus areas are renewable fuels, batteries, carbon capture and hydrogen. We are progressing our goal to become a leading producer of renewable fuels through our Rodeo Renewed project and alliances with Southwest Airlines and British Airways to supply sustainable aviation fuel. We are extending participation in the battery value chain through our investment in NOVONIX to advance the production and commercialization of next-generation anode materials for lithium-ion batteries. We have established a competitive position and scale in the high potential carbon capture market and are also pursuing opportunities in hydrogen fueling. These commercial ventures are supported by our Energy Research and Innovation group where research is focused on opportunities in renewable fuels, photovoltaic polymers, next generation batteries, and solid oxide fuel cells.

Our Company’s commitment to sustainability is aligned with our compensation programs. The variable compensation incentive program (VCIP) is the annual bonus program that has 50% weighting on Operational Sustainability and 50% weighting on Financial Sustainability performance metrics. VCIP applies to all employees, from the CEO and NEOs throughout the workforce. In 2021, we increased the weighting of environmental factors in VCIP to 15 percent from 5 percent, and in doing so, added performance metrics for (1) advancing lower-carbon investments, optimization, and innovation and (2) reducing manufacturing emissions intensity and setting GHG emissions reduction targets.

HUMAN CAPITAL MANAGEMENT

Our Board of Directors recognizes the importance of human capital management practices to the long-term success of the Company. They advise senior leadership on our key principles of human capital management and the executive leadership team is responsible for the deployment of our high-performing organization to deliver exceptional performance on a sustainable basis. Below are the key principles of our human capital management strategy. More information regarding how we operationalize our strategy can be found in our Human Capital Management Report on our website at www.phillips66.com/our-people.

For more information on how our Board of Directors oversees Corporate Responsibility, Sustainability and Human Capital Management, see pp. 33-35 of this Proxy Statement.

Proxy Summary

This summary highlights information contained elsewhere in this Proxy Statement, but does not contain all of the information that you should consider. You should read the entire Proxy Statement before you vote.

		Election of Directors The Board recommends that you vote "FOR” the four director nominees.
PROPOSAL 1

→  See page 17

Our 11-member Board continued to be highly engaged in overseeing our strategy, strong governance practices, and human capital management, especially in light of the continuing COVID-19 pandemic. The Board continued its robust shareholder engagement dialogue and remained committed to being responsive to shareholder concerns. The addition of two new members in 2021 further added to the breadth of skills, perspectives, and diverse backgrounds represented on our Board. 

SHAREHOLDER OUTREACH AND RESPONSIVENESS

Significant Shareholder Engagement

Ongoing engagement with our shareholders is important to us. We communicate with our shareholders through a variety of means, including meetings, investor presentations, our website, and publications we issue. As part of our annual engagement program, we regularly reach out to shareholders for dialogue concerning their priorities. This year we significantly expanded the scope of our stockholder outreach regarding executive compensation and ESG topics.

Following the outcome of our 2021 Annual Meeting, our Board sought to engage in meaningful discussions with our shareholders to understand their voting decisions, provide insight regarding Phillips 66’s practices, and preview potential responsive enhancements to the compensation programs. We conducted two rounds of engagement in fall 2021 to augment the conversations we held with shareholders leading up to the 2021 Annual Meeting. These conversations provide us with valuable feedback that directly informed Board deliberations.

In September 2021, we spoke with investors representing 40% of shares outstanding with a focus on our compensation program design and the relative degree of alignment between Company performance and rewards. Many of these conversations were led by two of our independent directors. In November 2021, we had a second round of conversations with many of the same shareholders, including investors representing 40% of shares outstanding. This second round of conversations provided opportunity to discuss investor perspectives on climate and the Company’s approach to the energy transition, in addition to capturing any further perspectives regarding compensation matters. Additional detail regarding our outreach effort and the feedback we received can be found on page 30.

Responsive to Shareholder Feedback

This year, in direct response to the shareholder feedback we received through our significant engagement effort, the Compensation Committee implemented meaningful changes to our executive compensation program and related disclosures for 2022, as discussed on page 42.

In connection with our 2021 Annual Meeting, our shareholders expressed their interest in the Company setting and publishing GHG emissions reduction targets. We responded in September by setting impactful, attainable and measurable targets to reduce GHG emissions intensity from our operations and energy products by 2030. Our targets are to reduce Scope 1 and Scope 2 emissions intensity from operations by 30% and Scope 3 emissions intensity of our energy products by 15%, below 2019 levels.

Our shareholders also requested that we report on climate lobbying, and we responded by publishing our Lobbying Activities Report, which details our governance, compliance processes, policy development and transparent reporting on our climate-related lobbying activities. Additional detail about our ESG efforts can be found on page 30. 

BOARD HIGHLIGHTS

Our certificate of incorporation requires a classified Board, meaning our Board is divided into three classes of directors, with each class elected for a three-year term.

		Director Since		Committee Memberships					Other Public Boards
	Name and Primary Occupation		Independent	AFC	HRCC	NGC	PPSC	EC
	Current Nominees
	Greg C. Garland, 64 Chairman and CEO of Phillips 66	2012							1
	Gary K. Adams, 71 Former Chief Advisor - Chemicals for IHS Markit	2016							1
	John E. Lowe, 63 Senior Executive Advisor to Tudor, Pickering, Holt & Co.	2012							2
	Denise L. Ramos, 65 Former Chief Executive Officer, President and Director of ITT Inc.	2016							2
	Directors Whose Terms Expire in 2023
	Charles M. Holley, 65 Former Executive Vice President and Chief Financial Officer of Walmart Inc.	2019							2
	Denise R. Singleton, 59 Executive Vice President, General Counsel and Secretary of WestRock Company	2021							1
	Glenn F. Tilton, 73 Former Chairman and Chief Executive Officer of UAL Corporation	2012							2
	Marna C. Whittington, 74 Former Chief Executive Officer of Allianz Global Investors Capital	2012							2
	Directors Whose Terms Expire in 2024
	Julie L. Bushman, 61 Former Executive Vice President of International Operations of 3M	2020							2
	Lisa A. Davis, 58 Former member of Managing Board of Siemens AG and CEO for Siemens Gas and Power	2020							4
	Douglas T. Terreson, 60 Former Head of Energy Research at Evercore ISI	2021							0

AFC  Audit and Finance	PPSC  Public Policy and Sustainability	Chair
HRCC  Human Resources and Compensation	EC  Executive	Member
NGC  Nominating and Governance

Our Board seeks to achieve a diverse and broadly inclusive membership. Our Corporate Governance Guidelines reflect our commitment to an annual assessment of board member characteristics including diversity of skills, gender, age, ethnicity, background, professional experience and board tenures. Our directors bring varying perspectives to the Board based on their distinct backgrounds and experiences. In 2021, Denise Singleton and Douglas Terreson joined the Board. We believe that these new directors add to the breadth of experience and perspectives of our Board. As we recruit new members for our Board, we will adhere to our Corporate Governance Guidelines by actively seeking women and underrepresented candidates as well as candidates with diverse backgrounds, skills and experience to serve on our Board. We disclose the characteristics of our current Board members in this report with their consent. Our Nominating and Governance Committee is focused on Board refreshment and evaluates directors’ perspectives in the context of our Company’s evolving business and prioritizes diversity to ensure effective Board oversight. To more completely convey our Board’s composition, we have included a skills matrix under the Board Skills and Experience section of this Proxy Statement that our Nominating and Governance Committee uses to review and identify the competencies of directors and composition of the Board as a whole.

→ See page 40

PAY FOR PERFORMANCE

Our executive compensation programs are designed to pay for performance. We link compensation to Company performance and use metrics we believe will drive long-term shareholder value and that are aligned with Company strategy. We align the interests of our executives with our shareholders through equity compensation, and we align execution of short-term priorities with all employees through annual cash bonus.

COMPENSATION SNAPSHOT

Our executives’ compensation includes base salary, an annual bonus opportunity under our Variable Compensation Incentive Program (“VCIP”), and equity-based compensation, including stock options, restricted stock units (“RSUs”) and awards under our Performance Share Program (“PSP”). The illustration below summarizes the principal elements of our executive compensation programs and the performance drivers of each element and shows the percentage each pay element comprises of target total direct compensation for 2021 for our CEO and other named executive officers (“NEOs”). 

Key Elements of Pay
CEO	Other NEOs	Delivered via	Performance Drivers (and Weightings)
Base Salary		Cash	•   Annual fixed cash compensation to attract and retain NEOs
Annual Incentive		Variable Cash Incentive	Operational Sustainability 50%
		Program (VCIP)	•   Safety & Operating Excellence (25%) •   Environment (15%) •   High-Performing Organization (10%)
			Financial Sustainability 50%
			•   Adjusted EBITDA (40%) •   Adjusted Controllable Costs (10%)
Long-Term Incentives (LTI)		Performance Share	•   Return on Capital Employed (50%)
		Program (PSP)	•   Relative TSR (50%)
		Restricted Stock Unit (RSU)	•   Long-term stock price appreciation
		Restricted Stock Unit (RSU)	•   Long-term stock price appreciation

As outlined, equity compensation accounts for roughly 70% of our executives’ pay, and PSP accounts for roughly 50% of that total. The PSP is designed to align the interests of our leaders with that of our shareholders through TSR and ROCE, and share price appreciation or depreciation over the 3 year- performance period. The metrics defined in 2019-2021 PSP delivered results below target, resulting in a below-target payout of 61%. The share price depreciated over that same performance period, which resulted in our executives realizing 56% of the initial target value.

The VCIP, which accounts for roughly 15% of our executives’ pay, is designed to create line-of-sight from our corporate strategy to execution of short-term priorities and align payouts with corporate results. Performance under the VCIP is equally weighted between operational sustainability and financial sustainability. New in 2021 was the addition of two new metrics to the program: Low Carbon Priorities and Greenhouse Gas Priorities. These changes were made to reinforce our commitment to the energy transition and further align our compensation program with shareholder interests. The metrics defined in the 2021 program delivered a combined result above target, resulting in a payout of 155%. The individual performance modifier for all NEOs was removed in 2021, and therefore no additional compensation above the Company payout was delivered to the NEOs.

More information can be found in the Compensation Discussion and Analysis section of this Proxy Statement. 

		Ratification of the Appointment of Ernst & Young The Board recommends that you vote “FOR” the proposal to ratify the appointment of Ernst & Young LLP
PROPOSAL 3
		→  See page 83
		Approval of the 2022 Omnibus Stock and Performance Incentive Plan The Board recommends that you vote “FOR” the proposal to approve the 2022 Omnibus Stock and Performance Incentive Plan.
PROPOSAL 4
		→  See page 86
		Two Shareholder Proposals, if properly presented The Board recommends that you vote “AGAINST” each shareholder proposal.
PROPOSALS 5 - 6
		→  See page 93

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Table of Contents 

		Election of Directors The Board recommends that you vote "FOR” the following director nominees.
PROPOSAL 1

The Board has nominated Greg C. Garland, Gary K. Adams, John E. Lowe, and Denise L. Ramos to stand for election for a term that expires at the annual meeting of shareholders in 2025.

Each nominee requires the affirmative vote of a majority of the votes cast in person or by proxy at the meeting. Directors are elected to serve until their successor is duly elected and qualified. If a nominee is unavailable for election, proxy holders may vote for another nominee proposed by the Board or the Board may reduce the number of directors to be elected at the Annual Meeting. No family relationship exists among any of our directors, director nominees or executive officers. There is no arrangement between any director or director nominee and any other person pursuant to which he or she was, or is to be, selected as a director or director nominee.

DIRECTORS STANDING FOR ELECTION

Greg C. Garland

Age: 64 Director since: 2012 Committees: Executive (Chair)		Career Highlights:
		•	Chairman and CEO of Phillips 66 (2012 to present)
		Experience and Key Skills: Mr. Garland brings extensive knowledge of all aspects of our business and industry, having served in executive positions at ConocoPhillips, as president and chief executive officer of Chevron Phillips Chemical Company, and as the chairman and chief executive officer of Phillips 66 Partners. Through his more than 35 years of service and experience in the energy industry, Mr. Garland brings to the Board each of the key skills we seek in a director.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Environmental experience	Industry experience
		Other Current Public Company Directorships:
		•	Amgen

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Gary K. Adams

Age: 71 Director since: 2016 Committees: Compensation; Public Policy and Sustainability		Career Highlights:
		•	Former Chief Advisor — Chemicals for IHS Markit (2011 to 2017)
		•	Director of Westlake Chemical Partners LP (2014 to 2016)
		•	Director of Phillips 66 Partners LP (2013 to 2016)
		Experience and Key Skills:
		Mr. Adams has over 40 years of experience in the petrochemicals and plastics industries, including 15 years at Union Carbide, where he began his career. Through various management positions, including as president, chief executive officer and chairman of Chemical Markets Associates Inc. ("CMAI”) before its acquisition by IHS, Mr. Adams also has leadership experience with operating responsibilities, and financial and risk oversight for a global business.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Industry experience
		Other Current Public Company Directorships:
		•	Trecora Resources

John E. Lowe

Age: 63 Director since: 2012 Committees: Audit (Chair); Nominating and Governance; Public Policy and Sustainability; Executive		Career Highlights:
		•	Senior Executive Advisor to Tudor, Pickering, Holt & Co. (2012 to present)
		•	Director of Agrium Inc. (2010 to 2015)
		Experience and Key Skills:
		Mr. Lowe had a 30-year career with ConocoPhillips and Phillips Petroleum Company, including several executive positions with ConocoPhillips, providing him extensive industry experience. Mr. Lowe also has financial and risk oversight, international and environmental experience through the series of executive positions he has held and his service on the boards of publicly traded oil and gas and energy companies.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Environmental experience	Industry experience
		Other Current Public Company Directorships:
		•	TC Energy
		•	APA Corporation (Non-Executive Chairman)

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Denise L. Ramos

Age: 65 Director since: 2016 Committees: Audit; Nominating and Governance; Public Policy and Sustainability (Chair); Executive		Career Highlights:
		•	Former Chief Executive Officer, President and director of ITT Inc. (2011 to 2018)
		•	Director of Praxair, Inc. (2014 to 2016)
		Experience and Key Skills:
		Ms. Ramos has experience in the oil and gas industry, including more than 20 years in various finance positions at Atlantic Richfield Company. Having also served as CEO of ITT and chief financial officer at ITT as well as Furniture Brands International and Yum! Brands, Ms. Ramos brings extensive senior leadership, risk management and global business expertise to the Board.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Environmental experience	Industry experience
		Other Current Public Company Directorships:
		•	Bank of America
		•	Raytheon Technologies

CONTINUING DIRECTORS

Julie L. Bushman

Age: 61 Director since: 2020 Committees: Audit; Public Policy and Sustainability Term Expires 2024		Career Highlights:
		•	Former Executive Vice President of International Operations of 3M (2017 to 2020) and Senior Vice President of Business Transformation and Information Technology of 3M (2013 to 2017)
		•	Director of Johnson Controls (2012 to 2016)
		Experience and Key Skills:
		As a former executive of 3M, Ms. Bushman brings executive management experience, as well as experience in international business, risk management and financial oversight. Ms. Bushman also brings environmental experience through her roles leading occupational health and environmental safety divisions at 3M.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Environmental experience	Information Technology
		Other Current Public Company Directorships:
		•	Adient plc
		•	Bio-Techne Corporation

Proposal 1: Election of Directors

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Lisa A. Davis

Age: 58 Director since: 2020 Committees: Compensation; Public Policy and Sustainability Term Expires 2024		Career Highlights:
		•	Former member of Managing Board of Siemens AG and CEO for Siemens Gas and Power (2014 to 2020)
		Experience and Key Skills:
		Ms. Davis brings significant industry experience to the Board through her roles at Siemens, as well as over 25 years in engineering and management roles at large integrated oil companies including ExxonMobil, Texaco and Shell, including executive vice president strategy and portfolio at Shell.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Industry experience
		Other Current Public Company Directorships:
		•	Air Products and Chemicals
		•	Kosmos Energy
		•	Penske Automotive Group
		•	C3.ai

Charles M. Holley

Age: 65 Director since: 2019 Committees: Audit; Public Policy and Sustainability Term Expires 2023		Career Highlights:
		•	Former Executive Vice President and Chief Financial Officer of Walmart Inc. (2010 to 2015)
		Experience and Key Skills:
		Mr. Holley served as Executive Vice President and Chief Financial Officer at one of the largest U.S. corporations, providing him with expertise in finance, senior management, risk and asset management, strategic planning and capital markets. From 2016 to 2019, Mr. Holley served as an independent senior advisor, U.S. CFO Program, Deloitte LLP. He also has extensive experience in international operations and technology platforms.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Information Technology
		Other Current Public Company Directorships:
		•	Amgen
		•	Carrier Global

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Denise R. Singleton

Age: 59 Director since: 2021 Committees: Audit; Public Policy and Sustainability Term Expires 2023		Career Highlights:
		•	Executive Vice President, General Counsel and Secretary of WestRock Company (since March 2022)
		•	Senior Vice President, General Counsel and Corporate Secretary of IDEX Corporation (2015 to March 2022)
		•	Senior Vice President, General Counsel, Corporate Secretary and Chief Compliance Officer at SunCoke Energy, Inc. (2011 to 2015)
		Experience and Key Skills:
		Ms. Singleton was named Executive Vice President, General Counsel and Secretary of WestRock Company in March 2022. Previously, she was Senior Vice President, General Counsel and Corporate Secretary of IDEX Corporation, a position she held from 2015 to 2022. Prior to joining IDEX, Ms. Singleton served as Senior Vice President, General Counsel, Corporate Secretary and Chief Compliance Officer at SunCoke Energy, Inc. and its controlled company SunCoke Energy Partners, L.P., where she was on the board of directors, from 2011 to 2015. Prior to joining SunCoke Energy, Ms. Singleton held several positions at PPG Industries, Inc., and was a partner at Shaw Pittman LLP, a law firm.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Environmental experience
		Other Current Public Company Directorships:
		•	Teledyne Technologies Incorporated

Douglas T. Terreson

Age: 60 Director since: 2021 Committees: Compensation; Public Policy and Sustainability Term Expires 2024		Career Highlights:
		•	Former Head of Energy Research at Evercore ISI (2016 to 2021)
		Experience and Key Skills:
		Mr. Terreson is a former Senior Advisor at Evercore, a position he held from April 2021 through July 2021. He previously served as the Head of Global Energy at Evercore ISI, from 2016 until April 2021. Mr. Terreson joined International Strategy & Investment Group (ISI), which was acquired by Evercore in 2014, in 2009, after 15 years at Morgan Stanley, where he managed the Global Energy Group. Prior to that, he managed Putnam Investments' energy mutual fund. Mr. Terreson began his career as an engineer with Schlumberger Limited.
		Financial experience		Global experience	Risk Management experience	Industry experience

Proposal 1: Election of Directors

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Glenn F. Tilton

Age: 73 Director since: 2012 Committees: Compensation; Nominating and Governance (Chair); Public Policy and Sustainability; Executive Term Expires 2023		Career Highlights:
		•	Former Chairman of the Midwest, JPMorgan Chase (2011 to 2014)
		•	Former Non-Executive Chairman, United Continental Holdings (2010 to 2012)
		•	Former Chairman and Chief Executive Officer of UAL Corporation (2002 to 2010)
		Experience and Key Skills:
		Mr. Tilton previously served as chairman and chief executive officer of UAL Corporation, the parent company of United Air Lines, as well as chairman of the Midwest of JPMorgan Chase & Co. Mr. Tilton's career has provided him with strong management experience overseeing complex multinational businesses operating in highly regulated industries as well as expertise in finance and capital markets matters. He also has extensive experience in the energy industry through his more than 30 years in increasingly senior roles with Texaco Inc., including chairman and chief executive officer.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Environmental experience	Industry experience
		Other Current Public Company Directorships:
		•	Abbott Laboratories
		•	AbbVie Inc. (Lead Director)

Marna C. Wllittington

Age: 74 Director since: 2012 Committees: Compensation (Chair); Nominating and Governance; Public Policy and Sustainability; Executive Term Expires 2023		Career Highlights:
		•	Former Chief Executive Officer of Allianz Global Investors Capital (2002 to 2012)
		Experience and Key Skills:
		Dr. Whittington has many years of leadership experience and expertise as a former senior executive in the investment management industry, including as chief executive officer of Allianz Global Investors Capital. She has extensive knowledge of and substantial experience in management, and in financial, investment and banking matters and provides valuable insight from her previous experience serving as a public company board member.
		C-Suite experience		Financial experience	Global experience	Risk Management experience	Industry experience
		Other Current Public Company Directorships:
		•	Macy's, Inc
		•	Oaktree Capital Group LLC

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BOARD SKILLS AND EXPERIENCE

 

Throughout the year, the Board continued its proactive assessment of board succession planning and refreshment. The Nominating and Governance Committee and full Board work to ensure we maintain a Board that embodies a broad and diverse set of experiences, qualifications, attributes and skills to provide effective oversight of management and the Company. When seeking new candidates, the Board considers a diverse pool of qualified candidates who could potentially serve as Board members. We view diversity in terms of skills, as well as gender, age, race, ethnicity, background, professional experience and perspectives.

As the needs of the Company change, the Board revisits the skills and experiences it seeks. Included in the matrix below are the core skills and experiences of C-suite, environmental, risk management, international/ global and industry experience, as well as additional skills and experiences the Board currently considers, for our continuing directors.  

	Adams	Bushman	Davis	Garland	Holley	Lowe	Ramos	Singleton	Terreson	Tilton	Whittington
Age*	71	61	58	64	65	63	65	59	60	73	74
Gender	M	F	F	M	M	M	F	F	M	M	F
Independence	●	●	●		●	●	●	●	●	●	●
Other Public Company Boards	1	2	4	1	2	2	2	1	0	2	2
C-Suite Experience	●	●	●	●	●	●	●	●		●	●
Financial Experience	●	●	●	●	●	●	●	●	●	●	●
International/Global Business	●	●	●	●	●	●	●	●	●	●	●
Risk Management	●	●	●	●	●	●	●	●	●	●	●
Environmental		●		●		●	●	●		●
Industry
Energy	●		●	●		●	●		●	●
Pipeline/Transportation/Logistics	●			●		●				●
Refining			●	●		●	●			●
Chemicals	●			●		●				●	●
Midstream	●			●		●				●
Information Technology		●			●
Business Transformation		●	●	●	●	●	●	●	●	●
Investment Banking/Finance	●		●	●	●	●	●	●	●	●	●
Public Affairs			●	●	●	●	●	●		●
Government Affairs			●	●	●	●	●			●

* As of March 15, 2022

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DIRECTOR QUALIFICATIONS AND NOMINATION PROCESS

 

Annual Assessment of Size, Composition and Structure

The Board strives to maintain an appropriate balance of tenure, turnover, diversity, skills and experience. Our average director tenure is approximately 5 years, representing an appropriate balance of tenures. The Board does not maintain term limits, as the Board believes that continuity of service can provide stability and valuable insight. Our Corporate Governance Guidelines include a mandatory retirement that provides that no director may serve past the annual meeting immediately following his or her 75th birthday. The average age of our directors is 64.8.

The Board ensures refreshment and continued effectiveness through evaluation, nomination, and other policies, processes and practices. For example:

●	The Nominating and Governance Committee annually reviews with the Board the qualifications for Board members and the composition of the Board as a whole.

●	The Nominating and Governance Committee annually reviews each director nominee’s continuation on the Board and makes recommendations to the full Board.

●	The Company’s Corporate Governance Guidelines provide that any director whose principal outside responsibilities have changed since election to the Board should volunteer to resign to give the Board the opportunity to review the appropriateness of continued Board membership under the circumstances.

 

Self Assessment
1 Oversight of annual evaluation	Each committee of the Board performs an annual self-assessment, and the Nominating and Governance Committee and Lead Director oversee an annual self-assessment of the full Board.
2 Survey and individual discussions	The self-assessment includes an evaluation survey and/or individual discussions between the Lead Director and each other director.
3 Presentation of results	A summary of the results of each committee’s self-assessment is presented to the committee and discussed in executive session. The Lead Director presents a summary of the results of the Board evaluation to the Board in executive session.
4 Incorporation of feedback	Any matters requiring further action are identified and action plans developed to address the matter.

 

RECENT BOARD REFRESHMENT

In 2021, the Board appointed Denise R. Singleton and Douglas T. Terreson to the Board. Ms. Singleton brings significant c-suite, financial, global, risk management and environmental experience to the Board. Mr. Terreson brings significant financial, global, risk management and industry experience. These directors’ skills and perspectives further enhance our diversity and expertise in the boardroom. Their appointments were informed by the Board’s continued focus on its composition, as well as insights provided through the Board’s annual self-evaluation process. Our current board composition provides a diversity of thought and a broad range of skills and perspectives aligned with our strategy. 

Board changes since 2019:
●	Five new highly-skilled directors have joined the Board	●	Skills enhanced:
●	Increased gender and racial/ethnic diversity of the Board		●	Environmental
			●	Industry
			●	Information Technology
			●	Finance

 

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Identification and Consideration of New Nominees

The Board is responsible for nominating directors and filling vacancies that may occur between annual meetings, based upon the recommendation of the Nominating and Governance Committee. The Nominating and Governance Committee process for identifying and recommending candidates includes:

 

1 Review	The Nominating and Governance Committee considers the Company’s current needs and long-term and strategic plans to determine the skills, experience and characteristics needed by our Board.
2 Identify	The Nominating and Governance Committee identifies candidates through the use of a search firm or the business and organizational contacts of directors and management.
3 Evaluate	In evaluating potential candidates for nomination to the Board, the Nominating and Governance Committee and the Board consider several factors:
	●	all directors are expected to possess the highest personal and professional ethics, integrity and values and be committed to representing the long-term interests of the Company’s shareholders;
	●	candidates should possess skills and experience complementary to those of existing directors; and
	●	additionally, directors are expected to devote sufficient time and effort to their duties as a director.
4 Recommend	The Nominating and Governance Committee recommends director candidates to the Board of Directors with the goal of creating a balance of knowledge, experience and diversity.

The core skills and qualifications considered in evaluating director nominees and Board composition as a whole are described below.

 

	C-Suite experience			Financial experience			Global experience
Executive management experience provides valuable insights and practical understanding of companies, and the methods to drive change and growth within an organization			Finance and financial reporting experience provide knowledge necessary to evaluate our performance by reference to financial targets and to oversee financial reporting			Global business or international experience provides valuable perspectives on our operations and enables the oversight of our strategic initiatives
	Risk management experience			Environmental experience			Industry experience
Experience in managing risk ensures capabilities necessary for risk oversight responsibilities, bringing background and experience that increase directors’ effectiveness			Experience in environmental regulation helps in effective evaluation and oversight of our strategy to provide energy and improve lives while ensuring a healthy and safe environment			Energy experience brings pertinent background and knowledge to provide perspective on issues specific to the Company’s industry, business, operations and strategy

 

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Commitment to Board Diversity   The Nominating and Governance Committee believes that the Board should reflect a range of talents, ages, skills, experiences, diversity, and expertise sufficient to provide sound and prudent guidance with respect to the Company’s strategic and operational objectives. The Board has committed to seeking women and underrepresented groups, as well as candidates with diverse backgrounds, skills and experiences, as part of the search process for new directors. We have incorporated this commitment into our Corporate Governance Guidelines.

 

Shareholder Recommendation of Candidates

The Nominating and Governance Committee will consider director candidates recommended by shareholders. A shareholder wishing to recommend a candidate for nomination by the Nominating and Governance Committee should follow the procedures described under Submission of Future Shareholder Proposals and Director Nominations. In addition, the shareholder should provide such other information deemed relevant to the Nominating and Governance Committee’s evaluation. Candidates recommended by the Company’s shareholders are evaluated on the same basis as candidates recommended by the Company’s directors, management, third-party search firms or other sources.

BOARD INDEPENDENCE

 

Our Corporate Governance Guidelines contain director independence standards, which are consistent with the listing standards of the NYSE. These standards assist the Board in determining the independence of the Company’s directors. The Board of Directors has affirmatively determined that each director, other than Mr. Garland, meets our independence standards. Mr. Garland is not considered independent because he is an executive officer of the Company.

In making independence determinations, the Board specifically considered the fact that many of our directors are directors of companies with which we may conduct business. Additionally, some of our directors may purchase products, such as gasoline from our retail sites, from the Company. In all cases, it was determined that there are no relationships or transactions that are material to the Company or the director and accordingly, there are no relationships that would affect the independence of any director other than Mr. Garland.

 

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Corporate Governance

 

BOARD LEADERSHIP STRUCTURE

 

Chairman and CEO Roles

The Board of Directors believes that currently, it is in the best interests of the Company and shareholders to combine the roles of Chairman and CEO. However, there is no Company policy regarding whether the roles should be combined or separated, and our Corporate Governance Guidelines state that the Board will retain flexibility and periodically consider whether the roles should be separated and, if so, whether the Chairman should be an independent director or an employee. The Board believes that Mr. Garland’s extensive industry experience and direct, day-to-day involvement in managing the Company as the CEO makes him best suited to also serve as Chairman and guide the Board in setting Company priorities and addressing Company risks and challenges.

Independent Director Leadership

Our Corporate Governance Guidelines state that when the Chairman of the Board is an employee of the Company, the non-employee directors will name a Lead Director. Glenn Tilton was appointed to serve as our Lead Director in 2016. As Lead Director, Mr. Tilton chairs executive sessions, coordinates the activities of the non-employee directors and performs other duties and responsibilities as determined by the Board, including:

●	advising the Chairman on Board meeting schedules, seeking to ensure that the non-employee directors can perform their duties responsibly without interfering with operations;

●	providing the Chairman with input on agendas for Board meetings to assure there is sufficient time for discussions;

●	advising the Chairman on the quality, quantity and timeliness of the flow of information from management to allow directors to perform their duties effectively and responsibly, including specifically requesting certain materials be provided to the Board;

●	recommending to the Chairman the retention of consultants who report directly to the Board of Directors;

●	interviewing Board candidates and making nomination recommendations;

●	assisting in assuring compliance with and implementation of the Corporate Governance Guidelines;

●	ensuring that he, or another appropriate director, is available for engagement with shareholders when warranted;

●	calling meetings of the non-employee directors as needed, developing the agenda for and chairing any such meetings and executive sessions;

●	acting as principal liaison between the non-employee directors and the Chairman on sensitive issues;

●	participating with the Human Resources and Compensation Committee in the periodic discussion of CEO performance;

●	leading the Board’s annual self-assessment and meeting with the CEO to discuss the results of the annual self-assessment; and

●	working with the Nominating and Governance Committee to recommend Board committee membership and committee chairs.

The Board of Directors believes that its current structure and processes encourage its non-employee directors to be actively involved in guiding its work. The chairs of the Board’s committees review their respective agendas and committee materials in advance of each meeting, communicating directly with other directors and members of management as each deems appropriate. Moreover, each director may suggest agenda items and raise matters that are not on the agenda at Board and committee meetings.

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CONSIDERATIONS IN SELECTING THE CURRENT LEAD DIRECTOR

Mr. Tilton has been elected annually as the lead independent director since February 2016 and was re-elected by our Board on February 9, 2022, to continue to serve as lead independent director. The Board believes Mr. Tilton is imminently qualified to serve as our lead independent director in light of his experience as the lead independent director for AbbVie and his recent service as chairman of the Midwest for JPMorgan Chase & Co. and non-executive chairman of the board of United Continental Holdings, Inc. Through these roles and other executive positions he has held, Mr. Tilton has demonstrated strong leadership skills that well-position him to lead our independent directors. Mr. Tilton also has vast management experience in overseeing complex multinational businesses operating in highly regulated industries, as well as expertise in finance and capital markets matters.

 

BOARD COMMITTEES

 

The Board has five standing committees, as described below. The charters for each of the committees may be found in the “Investors” section on the Phillips 66 website (www.phillips66.com) under the “Corporate Governance” caption. Shareholders may also request printed copies of these charters by following the instructions located under Additional Information. Other than our Executive Committee, all members of our Board’s committees meet the independence standards under our Corporate Governance Guidelines, the NYSE listing standards, and SEC rules or regulations, as applicable. The tables below show the composition of the committees as of March 15, 2022.

 

Audit and Finance Committee

(the “Audit Committee”)
Members: John E. Lowe (Chair), Julie L. Bushman, Charles M. Holley, Denise L. Ramos Denise R. Singleton   Number of meetings in 2021: 9	Primary Responsibilities:
	●	Oversee the integrity of accounting policies, internal controls, financial statements, and financial reporting practices, and certain financial matters covering the Company's capital structure, complex financial transactions, financial risk management, retirement plans and tax planning.
	●	Review significant risk exposures and management's monitoring, control and reporting of such exposures.
	●	Monitor compliance with legal and regulatory requirements, including our Code of Business Ethics and Conduct; the qualifications and independence of independent auditors; and the performance of the internal audit function and independent auditors.
	Financial Expertise and Financial Literacy of Audit Committee Members
	The Board has determined that each of Mr. Lowe, Mr. Holley and Ms. Ramos satisfies the SEC's criteria for "audit committee financial experts.” Additionally, the Board has determined that each member is financially literate within the meaning of the NYSE listing standards.

 

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Human Resources and Compensation Committee
(the "Compensation Committee”)

Members: Marna C. Whittington (Chair), Gary K. Adams, Lisa A. Davis, Douglas T. Terreson, Glenn F. Tilton   Number of meetings in 2021: 6	Primary Responsibilities:
	●	Oversee executive compensation programs, policies and strategies and approve metrics, goals and objectives under incentive compensation programs, including those relevant to senior officers.
	●	Approve goals and objectives relevant to CEO compensation, evaluate CEO performance in light of those goals and objectives, and determine the CEO's overall compensation.
	●	Oversee initiatives of our human capital strategies, including in the areas of inclusion and diversity, management succession planning and talent management.
	Additional information about the Compensation Committee can be found in the Compensation Discussion and Analysis.
	Compensation Committee Interlocks and Insider Participation
	None of the members of the Compensation Committee during fiscal year 2021 or as of the date of this Proxy Statement is or has been an officer or employee of Phillips 66 and no executive officer of Phillips 66 served on the compensation committee or board of any company that employed any member of Phillips 66's Compensation Committee or Board.

 

Nominating and Governance Committee

Members: Glenn F. Tilton (Chair), John E. Lowe, Denise L. Ramos, Marna C. Whittington   Number of meetings in 2021: 5	Primary Responsibilities:
	●	Identify individuals to become Board members, recommend nominees for election and Board committee assignments.
	●	Review and recommend compensation and benefits policies for non-employee directors.
	●	Recommend appropriate corporate governance policies and procedures.
	●	Oversee Board's annual self-evaluation of performance and monitor Board composition.
	●	Jointly with Compensation Committee evaluate potential successors for the CEO.

 

Public Policy and Sustainability Committee

Members: Denise L. Ramos (Chair), Gary K. Adams, Julie L. Bushman, Lisa A. Davis, Charles M. Holley, John E. Lowe, Denise R. Singleton, Douglas T. Terreson, Glenn F. Tilton, Marna C. Whittington   Number of meetings in 2021: 5	Primary Responsibilities:
	● ● ●	Review policies, programs and practices regarding health, safety and environmental protection; social impact and corporate responsibility matters. Review the sustainability program and oversee progress of sustainability initiatives. Review and approve budget for charitable contributions and for political contributions and independent expenditures, and oversee all such expenditures and the administration of any political action committees.

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Executive Committee

Members: Greg C. Garland (Chair), John E. Lowe, Denise L. Ramos, Glenn F. Tilton, Marna C. Whittington   Number of meetings in 2021: None	Primary Responsibilities:
	●	Exercise the authority of the full Board, if needed, in intervals between regularly scheduled Board meetings, other than (1) those matters expressly delegated to another committee of the Board, (2) the adoption, amendment or repeal of any By-Laws, and (3) those matters that cannot be delegated to a committee under statute, the Certificate of Incorporation, or By-Laws.

To ensure continued Board effectiveness, the Nominating and Governance Committee periodically considers committee rotations, including in the event of a change in the composition of the Board. In 2020 the Public Policy Committee changed its name to the Public Policy and Sustainability Committee. This name change was in connection with revisions to the committee’s charter that broadened the scope of its responsibilities to specifically include oversight of the Company’s sustainability program and initiatives.

 

SHAREHOLDER OUTREACH AND RESPONSIVENESS

 

For several years, Phillips 66 has conducted a formal shareholder outreach program to listen to investor perspectives on our business strategy; corporate governance; executive compensation programs; environmental, social and governance (“ESG”); and other matters that are important to our investors. Information and feedback received through our engagement activities are shared with our executive leadership team and the Board of Directors, which help inform their decisions and oversight, respectively. We have a year-round shareholder engagement program focused on understanding and being responsive to shareholders.

In 2021, we engaged with representatives of many of our top institutional shareholders and discussed executive compensation, the energy transition and our sustainability efforts, among other ESG topics of importance.

Our multi-phase engagement effort in 2021 was a year-long process that involved three distinct rounds of engagement:

(1)	Lead-Up to the 2021 Annual Meeting

(2)	Compensation-Focused Engagement (September 2021)

(3)	Broader ESG Engagement (November 2021)

In the lead-up to the 2021 Annual Meeting, we undertook a significant effort to speak with our shareholders and hear their feedback on our compensation program, among other topics of interest. We leveraged those valuable insights to help build a set of potential compensation programs changes for 2022. Following the outcome of the 2021 Annual Meeting, we conducted extensive engagement to better understand shareholder perspectives and solicit feedback on our compensation programs and the potential enhancements under consideration. In November 2021, we followed up with a second round of engagement focused on broader ESG topics, including climate and our approach to the energy transition. Outreach in the second round of engagement included nearly all investors contacted in the first round of engagement. This approach enabled us to meet twice with a number of our shareholders during fall 2021 for discussions that provided us with valuable feedback that informed board deliberations. 

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Glenn Tilton (Lead Director and member of the Compensation Committee) and Marna Whittington (Chair of the Compensation Committee) led select engagements with shareholders representing a combined 34% of shares outstanding. Members of management participated in all shareholder engagements. More information on Shareholder Outreach and Responsiveness can be found in the Compensation Discussion and Analysis.

 

Lead-Up to 2021 Annual Meeting	Compensation-Focused Engagement (September 2021)	Broader ESG Engagement (November 2021)	Lead-Up to 2022 Annual Meeting
Contacted	Contacted	Contacted
59%	49%	48%
of shares outstanding	of shares outstanding	of shares outstanding	Significant shareholder engagement ongoing
Engaged	Engaged	Engaged
31%	40%	40%
of shares outstanding	of shares outstanding	of shares outstanding

Our significant multi-phase engagement effort in 2021 is described below: 

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This year, we heard that our shareholders were generally supportive of the planned changes made to our executive compensation program and disclosures, GHG emissions reductions targets, and climate lobbying disclosures, all of which were responsive to feedback received over the last year. Shareholders were interested in and supportive of our Board refreshment efforts and our attempts to declassify the Board. We also heard that investors are interested in additional disclosures on human capital management.

Highlights of some of the actions we have taken in response to our engagements over the last several years are shown below:

 

* TCFD is the Task Force on Climate-Related Financial Disclosures and SASB is the Sustainability Accounting Standards Board

 

Communications with the Board

Shareholders and interested parties may communicate with the Board of Directors in care of our Corporate Secretary. Communications to the non-employee directors should be addressed to “Board of Directors (independent members).”

 

Mailing Address: Corporate Secretary Phillips 66 2331 City West Blvd. Houston, TX 77042	Phone: (281) 293-6600
	Internet: “Investors" section of the Company's website (www.phillips66.com) under the “Corporate Governance" caption

Communications are distributed to the Board or to any individual directors, as appropriate, depending on the facts and circumstances outlined in the communication. In that regard, the Board has requested that items unrelated to its duties and responsibilities not be distributed, such as: business solicitations or advertisements; junk mail and mass mailings; new product suggestions; product complaints or inquiries; résumés and other job inquiries; spam; and surveys. Material that is considered hostile, threatening, illegal or similarly unsuitable also will be excluded.

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BOARD OVERSIGHT OF OUR COMPANY

 

Key Areas of Board Oversight

The Board provides oversight and advice in the following key areas:

 

Strategy

Risk Oversight

Corporate Responsibility/ Sustainability

Human Capital Management

Succession Planning

Strategic Oversight

Setting the strategic course of the Company and providing oversight of strategic risks involves a high level of constructive engagement between management and the Board. The Board regularly discusses the strategic priorities of the Company and the risks to the Company’s successful execution of its strategy, including global economic and other significant trends, as well as changes in the energy industry and regulatory initiatives.

Risk Oversight

The Company’s management is responsible for the day-to-day conduct of our businesses and operations, including management of risks the Company faces. To fulfill this responsibility, our management has established an enterprise risk management (“ERM”) program. The program is designed to identify and facilitate the management of significant risks facing the Company as well as the approaches to addressing risks.

 

BOARD OF DIRECTORS

 

 

●	Has broad oversight responsibility over the ERM program and receives management updates on the development and implementation of the program.

●	Responsible for satisfying itself, in this oversight role, that the risk management processes designed and implemented by the Company’s management are functioning as intended, and that necessary steps are taken to foster a culture of risk-adjusted decision making throughout the organization.

●	Exercises its oversight responsibility for risk assessment and risk management directly and through its committees.

●	Receives regular updates from its committees on individual areas of risk falling within each committee’s area of oversight and expertise.

●	Responds to the increasingly important aspect of cybersecurity to the Board’s risk oversight role by adding two members with information technology expertise and appointing them to the Audit Committee, which oversees cybersecurity risk management.

 

 

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BOARD COMMITTEES

 

Audit Committee	●     Has primary responsibility for overseeing the ERM program.
	●     Discusses the guidelines and policies to govern the process by which ERM is handled, and has been delegated responsibility to facilitate coordination among the Board's committees with respect to the Company's risk management programs.
	●    Throughout the year, the Audit Committee's meeting agendas, include discussions of individual risk areas, as well as an annual summary of the ERM process.
	●    Oversees information security (including cybersecurity) and technology risk management programs, which are fully integrated into the overall ERM program.
Compensation Committee	●    Considers the risks associated with compensation policies and practices for both executive compensation and compensation generally, as well as corporate culture and human capital risks generally.
Nominating and Governance Committee	●    Reviews policies and practices in the areas of corporate governance and is responsible for overseeing Board composition and director qualifications through the nomination process. Additionally, the Nominating and Governance Committee is responsible for CEO succession planning.
Public Policy and Sustainability Committee	●     Assists the Board in identifying, evaluating and reviewing social, political and environmental trends and related risks.
	●     Reviews management's proposed actions to anticipate and adjust to such trends and manage risks to achieve the Company's long-term business goals.
	●     Considers risks relating to: (i) health, safety and environmental matters; (ii) lobbying priorities and activities; (iii) public policy, including political spending policies and practices; (iv) corporate social responsibility and sustainability; and (v) emerging issues potentially affecting the reputation of the energy industry and the Company.

 

Corporate Responsibility/Sustainability Oversight

 

Corporate responsibility and ethics are the foundation at every level and aspect of our organization. Rigorous, consistent corporate governance practices contribute positively to shareholder value. Sustainability is integral to our corporate strategy and designed to ensure a resilient portfolio that creates long-term shareholder value.

We embrace engagement as an important tenet of good governance and value the views of our shareholders and other stakeholders. We believe that positive dialogue builds informed relationships that promote transparency and accountability. Although our Lead Director or other members of the Board periodically participate in meetings with shareholders as appropriate, management has the principal responsibility for shareholder communication.

Our board regularly reviews evolving corporate governance best practices, changing regulatory requirements and feedback from shareholders and makes changes it believes are in the best interest of Phillips 66 and its shareholders. Recognizing the growing importance of sustainable business practices, the public policy committee, which includes all independent members of the Board, changed its name in 2020 to the Public Policy and Sustainability Committee (PPSC). It also revised its charter to include the review of the Company’s sustainability program and initiatives to further emphasize oversight of these matters and the transition to a lower-carbon future.

In furtherance of our commitment to help the world address climate change, both the PPSC and Board actively oversee climate and other environmental matters and regularly receive updates on progress 

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against our ESG goals. Over the last year, our Board was involved in the target-setting process of our new company-wide GHG emissions reduction targets. The Board was also involved in the publication of our new climate Lobbying Activities Report, which details our governance, policy development and transparent reporting on climate-related lobbying activities.

We believe that engagement and good governance involve participating in political or public policy activities that advance the Company’s goals, are consistent with Company values, and improve the communities where we work and live. The PPSC also oversees political contributions, independent expenditures and the administration of any political action committees, including the publication of our Lobbying Activities Report.

Human Capital Management Oversight

 

Our Board recognizes the importance of our human capital practices in creating value and supporting our vision. The ability of Phillips 66 to attract, retain and develop talented employees, and create a workplace where they can innovate and thrive, is an integral part of our competitive strategy to drive long-term value and mitigate risk.

To that end, our Board routinely engages with senior leadership on matters such as talent pipeline, turnover, workplace culture, and inclusion and diversity. Each committee collaborates with senior leadership to stay informed, measure progress against goals, identify potential risks and develop meaningful solutions. Results of employee surveys and metrics on talent and diversity initiatives are reviewed by the Board on a regular basis. Board members also periodically visit our sites and meet with employees to stay connected to our corporate culture.

In addition, certain human capital metrics have been and continue to be measured, reviewed and managed as part of our compensation program and are discussed by the Compensation Committee in its regular meetings.

This human capital management oversight responsibility sits with the full Board. The full Board’s engagement across the breadth of human capital management topics demonstrates the value Phillips 66 places on our people.

Succession Oversight

 

Management succession planning is critical to ensuring business continuity and performance. Our Compensation Committee has responsibility to oversee our management succession planning, a role it shares with the Nominating and Governance Committee in the case of CEO succession. Our succession planning includes quarterly sessions with executives to monitor and guide leadership development for our key corporate positions. The Compensation Committee provides the oversight necessary to ensure we develop corporate leaders who are prepared for their roles in both the ordinary course of business and unexpected circumstances.

 

COMMUNITY INVOLVEMENT AND ENGAGEMENT

 

We are committed to creating value for our communities through economic development, philanthropy, volunteerism and advocacy, and by operating our business in a socially and environmentally responsible way. The communities in which our assets are located and where our employees live are critical stakeholders. We consistently and regularly engage with our local communities and seek their feedback. Our refining operations have community advisory councils or panels that include both Company representatives and community members. Many panels include adjacent operations from our midstream and lubricants businesses. These panels meet at least quarterly with refinery management to provide feedback, discuss topics of local concern and share insights on plans and activities. Our pipeline business units have year-round community awareness, education and listening panels to stay connected with those involved with and living near our extensive pipeline network.

 

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MEETINGS AND ATTENDANCE

 

Board Meetings

The Board of Directors met seven times in 2021. In addition to the regularly scheduled meetings of the Board, in October of each year, the Board holds a two-day strategy session with members of management to review the impact of different economic scenarios and strategic options on the long-term direction of the Company. All of our directors attended at least 75% of the meetings of the Board and committees on which they served. Recognizing that director attendance at the Company's annual meeting can provide the Company's shareholders with an opportunity to communicate with the directors about issues affecting the Company, the Company actively encourages directors to attend the annual meetings of shareholders. All of our directors who were serving as such as of the date of our 2021 Annual Meeting attended the meeting.

 

Executive Sessions

The independent directors hold regularly scheduled executive sessions of the Board and its committees without Company management present. These executive sessions are chaired by the Lead Director at Board meetings or by the committee chairs at committee meetings.

 

BOARD EDUCATION

 

Our Board recognizes the need to stay informed about current developments that affect the Company and the role of the Board and individual directors. Accordingly, the Board and each committee regularly receive educational updates from subject matter experts on a variety of topics, including legal and regulatory changes, governance practices, sustainability practices, and political activity. Our director onboarding program provides information on the Company and its business as well as the responsibilities of board members.

 

RELATED PARTY TRANSACTIONS

 

Our Code of Business Ethics and Conduct requires all directors and executive officers to promptly report any transactions or relationships that reasonably could be expected to constitute a related party transaction. The transaction or relationship is reviewed by the Company’s management and the appropriate committee of the Board to ensure that it does not constitute a conflict of interest and is appropriately disclosed.

Additionally, the Nominating and Governance Committee conducts an annual review of related party transactions between each director and the Company and its subsidiaries in making recommendations to the Board regarding the continued independence of each director. Since January 1, 2021, there have been no related party transactions in which the Company or a subsidiary was a participant and in which any director, executive officer, or any of their immediate family members had a direct or indirect

material interest.

The Nominating and Governance Committee also considered relationships that, while not constituting related party transactions where a director had a direct or indirect material interest, nonetheless involved transactions between the Company and an organization with which a director is affiliated, either directly or as a partner, shareholder or officer. The Nominating and Governance Committee determined that there were no transactions impairing the independence of any member of the Board.

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Director Compensation

 

OBJECTIVES AND PRINCIPLES

 

Compensation for non-employee directors is reviewed annually by the Nominating and Governance Committee, with the assistance of such third-party consultants as the Nominating and Governance Committee deems advisable, and set by action of the Board of Directors.

The Board’s goal in designing such compensation is to provide a competitive package that will enable it to attract and retain highly skilled individuals with relevant experience and reflects the time and talent required to serve on the board of a complex, multinational corporation. The Board seeks to provide sufficient flexibility in the form of payment to meet individual needs while ensuring that a substantial portion of director compensation is linked to the long-term success of the Company. In furtherance of our commitment to be a socially responsible member of the communities in which we participate, the Board believes that it is appropriate to extend the Phillips 66 matching gift program to charitable contributions made by individual directors.

The primary elements of our non-employee director compensation program are equity compensation and cash compensation.

 

 

Equity Compensation

In 2021, each non-employee director received a grant of RSUs with an aggregate value of $200,000 on the date of grant. Restrictions on the units issued to a non-employee director will lapse in the event of retirement, disability, death, or a change of control, unless the director has elected to receive the underlying shares after a stated period of time. Directors forfeit the units if, prior to the lapse of restrictions, the Board finds sufficient cause for forfeiture (although no such finding can be made after a change in control). Before the restrictions lapse, directors cannot sell or otherwise transfer the units, but the units are credited with dividend equivalents in the form of additional RSUs. When restrictions lapse, directors will receive unrestricted shares of Company stock as settlement of the RSUs.

Cash Compensation

In 2021, each non-employee director received $125,000 in cash compensation for service as a director. Non-employee directors serving in specified committee or leadership positions also received additional cash compensation as indicated in the chart above.

 

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The total annual cash compensation is payable in monthly cash installments. Directors may elect, on an annual basis, to receive all or part of their cash compensation in unrestricted stock or in RSUs (such unrestricted stock or RSUs are issued on the first business day of the month valued using the average of the high and low prices of Phillips 66 common stock as reported on the NYSE on such date), or to have the amount credited to the director’s deferred compensation account as described below. The RSUs issued in lieu of cash compensation are subject to the same restrictions as the annual RSUs described above.

Deferral of Compensation

Non-employee directors can elect to defer their cash compensation under the Phillips 66 Deferred Compensation Program for non-Employee Directors (the “Director Deferral Plan”). Deferred amounts are deemed to be invested in various mutual funds and similar investment choices (including Phillips 66 common stock) selected by the director from a list of investment choices available under the Director Deferral Plan.

The future payment of any compensation deferred by non-employee directors of Phillips 66 may be funded in a grantor trust designed for this purpose.

Directors’ Matching Gift Program

All active and retired non-employee directors are eligible to participate in the Directors’ Annual Matching Gift Program. This provides a dollar-for-dollar match of gifts of cash or securities, up to a maximum during any one calendar year of $15,000 per donor for active directors and $7,500 per donor for retired directors, to charities and educational institutions (excluding certain religious, political, fraternal, or collegiate athletic organizations) that are tax-exempt under Section 501(c)(3) of the IRC or meet similar requirements under the applicable law of other countries. Amounts representing these matching contributions are contained in the “All Other Compensation” column of the Director Compensation Table.

Other Compensation

The Board believes that it is important for significant others of directors and executives to attend certain meetings to enhance the collegiality of the Board. The cost of such attendance is treated by the Internal Revenue Service as income and is taxable to the recipient. The Company reimburses directors for the cost of resulting income taxes. Amounts representing this reimbursement are contained in the “All Other Compensation” column of the Director Compensation Table.

Stock Ownership

Each director is expected to own an amount of Company stock equal to at least the aggregate value of the annual equity grants during their first five years on the Board. Directors are expected to reach this level of target ownership within five years of joining the Board. Actual shares of stock, Restricted Stock, or RSUs, including deferred stock units, may be counted in satisfying the stock ownership guidelines.

 

All current directors are in compliance, or on track to comply, with the stock ownership guidelines.

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DIRECTOR COMPENSATION TABLE

 

Phillips 66 benchmarks its non-employee director compensation design and pay levels against a group of peer companies. The Company targets the median of this peer group for all elements of non-employee director compensation.

The following table summarizes the compensation for our non-employee directors for 2021 (for compensation paid to our sole employee director, Mr. Garland, please see Executive Compensation Tables).

 

	Fees Earned or Paid in Cash(1)	Stock Awards(2)	All Other Compensation(3)	Total
Name	($)	($)	($)	($)
Gary K. Adams	135,000	200,045	20,742	355,787
Julie L. Bushman	135,000	200,045	15,036	350,081
Lisa A. Davis	135,000	200,045	494	335,539
Charles M. Holley	135,000	200,045	2,951	337,996
John E. Lowe	150,000	200,045	—	350,045
Harold W. McGraw III(5)	33,750	200,045	—	233,795
Denise L. Ramos	155,000	200,045	30	355,075
Denise R. Singleton(4)	62,782	93,028	16,339	172,149
Douglas T. Terreson(4)	62,782	93,028	15,169	170,979
Glenn F. Tilton	205,000	200,045	28,484	433,529
Victoria J. Tschinkel(5)	33,750	200,045	28,168	261,963
Marna C. Whittington	150,000	200,045	16,990	367,035

 

(1)

Reflects 2021 base cash compensation of $125,000 payable to each non-employee director. In 2021, non-employee directors serving in specified committee positions also received the additional cash compensation described previously. Compensation amounts reflect adjustments related to various changes in committee assignments by Board members throughout the year, if any. Amounts shown include any amounts that were voluntarily deferred to the Director Deferral Plan, received in Phillips 66 common stock, or received in RSUs.

(2)

Amounts represent the grant date fair market value of RSUs. Under our non-employee director compensation program, non- employee directors received a 2021 grant of RSUs with an aggregate value of $200,000 on the date of grant, based on the average of the high and low prices for Phillips 66 common stock, as reported on the NYSE, on such date. These grants are made in whole shares with fractional share amounts rounded up, resulting in shares with a value of $200,045 being granted on January 15, 2021 ($93,028 granted on July 14, 2021 for Ms. Singleton’s and for Mr. Terreson’s prorated grant).

(3)

All Other Compensation is made up primarily of certain gifts by directors to charities and educational institutions (excluding certain religious, political, fraternal, or collegiate athletic organizations) that are tax-exempt under Section 501(c)(3) of the IRC or meet similar requirements under the applicable law of other countries that we match under our Matching Gifts Program (Mr. Adams $12,500; Ms. Bushman $15,000; Ms. Singleton $15,000; Mr. Terreson $14,500; Mr. Tilton $15,000; and Dr. Whittington $15,000). For active directors, the program matches up to $15,000 with regard to each program year. The amounts shown reflect the actual payments made by us in 2021. All Other Compensation also includes any personal flights, automobile transportation expenses, smaller gifts (such as books, ornaments, and jackets) as well as associated tax protection, and tax assistance when we request family members or other guests to accompany a director to a Company function and, as a result, the director is deemed to make personal use of Company assets such as Company aircraft and thereby incurs imputed income.

(4)

Amounts shown represent compensation paid to Ms. Singleton and Mr. Terreson following election to the Board in July 2021.

(5)

Amounts shown represent compensation paid to Mr. McGraw and Ms. Tschinkel prior to retiring from the Board in March 2021.

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	Advisory Approval of Executive Compensation The Board recommends that you vote “FOR” the advisory approval of the compensation of the Company's named executive officers.
PROPOSAL 2

In accordance with Section 14A of the Securities Exchange Act of 1934, as amended, shareholders are being asked to vote on the following advisory (non-binding) resolution:

RESOLVED, that the shareholders approve the compensation of Phillips 66’s Named Executive Officers (NEOs) as described in this Proxy Statement in the Compensation Discussion and Analysis section and in the Executive Compensation Tables (together with the accompanying narrative disclosures).

Approval of this proposal requires the affirmative vote of a majority of the shares present in person or represented by proxy at the meeting and entitled to vote on the proposal.

As required by SEC rules, Phillips 66 is providing shareholders with the opportunity to vote on an advisory resolution, commonly known as “Say-on-Pay,” considering approval of the compensation of its NEOs. We currently provide our shareholders the opportunity to vote on this proposal annually. Our next vote to determine the frequency with which we will provide Say-on-Pay votes is expected to take place in 2025.

The Compensation Committee, which is responsible for the compensation of our CEO and Senior Officers (as defined in Role of the Compensation Committee), oversees the development of compensation programs designed to attract, retain and motivate executives who enable us to achieve our strategic and financial goals. The Compensation Discussion and Analysis and the Executive Compensation Tables, together with the accompanying narrative disclosures, allow you to view the trends in compensation and application of our compensation philosophies and practices for the years presented.

The Board of Directors believes that the Phillips 66 executive compensation programs align the interests of our executives with those of our shareholders. Our compensation programs are guided by the philosophy that the Company’s ability to provide value is driven by superior individual performance. The Board believes that a company must offer competitive compensation to attract and retain experienced, talented and motivated employees. In addition, the Board believes employees in leadership roles within the organization are motivated to perform at their highest levels when performance-based pay represents a significant portion of their compensation. The Board believes that our philosophy and practices have resulted in executive compensation decisions that are aligned with Company and individual performance, are appropriate in value, and have benefited the Company and its shareholders.

Because your vote is advisory, it will not be binding upon the Board of Directors. Nevertheless, the Compensation Committee and the Board will consider the outcome of the vote when evaluating future executive compensation arrangements. However, votes for or against our compensation programs will not necessarily inform the Compensation Committee and the Board about which elements of those programs shareholders approve or disapprove. For this reason, the Board encourages shareholders to engage with us to allow the Compensation Committee to understand shareholders’ views and consider that feedback when making decisions.

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Compensation Discussion and Analysis

 

Table of Contents
Executive Summary	41
Executive Compensation Program Summary	43
Executive Compensation Program Details	50
CEO Pay Aligned with Company Performance	62
Additional Compensation Practices	63
Role of the Compensation Committee	67

Our Named Executive Officers (“NEOs”) for 2021 were:

 

	Greg Garland Chairman and Chief Executive Officer		Mark Lashier President and Chief Operating Officer
	Kevin Mitchell Executive Vice President, Finance and Chief Financial Officer		Robert Herman Executive Vice President, Refining
	Tim Roberts Executive Vice President, Midstream

 

EXECUTIVE SUMMARY

 

	"The Board values opportunities to hear directly from our shareholders. Over the past year, the Chair of the Compensation Committee and I engaged with our shareholders, and the committee has made changes to Phillips 66's executive compensation programs informed by the feedback we gathered.”
	- Glenn Tilton, Lead Director and Member of the Compensation Committee

 

Our Approach to Compensation and Governance

 

Since our inception in 2012, our strategy is unchanged and we have operated with clear objectives – enable our high-performing workforce to execute our corporate strategy efficiently and effectively, while remaining vigilant and focused on safety and operating excellence, in order to deliver profitable growth, enhance returns, and provide a secure, competitive and growing dividend. As a result, we have built a resilient company, positioned for long-term performance even in the midst of difficult market conditions.

 

Pay-For- Performance	Consistent with our philosophy that executive compensation should be linked to Company performance and directly aligned with shareholder value creation, a significant portion of NEO compensation remains at risk and based on performance metrics aligned with the execution of our corporate strategy.
Shareholder Engagement	After reviewing the results of the 2021 Annual Meeting, our Compensation Committee sought to better understand shareholder perspectives on our executive compensation program and practices. We have a well-established shareholder engagement program, including more in-depth conversations following the Annual Meeting to ensure a clear understanding of key considerations driving our shareholders' votes.
Responsive Changes	The Compensation Committee leveraged specific insights from shareholders to build a set of potential executive compensation program changes that we discussed in depth with them in the fall of 2021. In those conversations, we solicited additional perspectives on our executive compensation practices and found that our shareholders strongly supported the proposed changes.

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Stakeholder Engagement on 2021 Say-on-Pay Vote Outcome

 

	“We integrate shareholder perspectives in the design and delivery of our executive compensation programs, which are linked to our strategy, align pay and performance, and help us attract and retain executives. In addition to evaluating our executive compensation program design, we reviewed and enhanced our disclosures to align with shareholder feedback and expectations.”
	– Marna Whittington, Chair, Human Resources and Compensation Committee

 

Responding to the 2021 Say-on-Pay Vote Outcome

 

The Compensation Committee viewed the results of the 2021 say-on-pay vote as an opportunity to have more in-depth conversations with shareholders to understand their perspectives on our executive compensation practices and programs, and the Company’s approach to GHG emissions reduction targets and Climate Lobbying Disclosures. We leveraged those valuable insights to help build a set of potential compensation programs changes for 2022. Following the 2021 Annual Meeting two separate rounds of engagement discussions took place, the first of which was in September 2021 and focused on our compensation program design, the relative degree of alignment between Company performance and rewards, and potential program enhancements in response to shareholder feedback. The second round of engagement discussions, which took place in November 2021, provided opportunity to discuss investor perspectives on climate and the Company’s approach to the energy transition, in addition to capturing any further perspectives regarding compensation matters.

 

SPRING 2021 Lead-Up to the 2021 Annual Meeting

In the lead-up to the 2021 Annual Meeting, we undertook a significant effort to speak with our shareholders and hear their feedback on our compensation program, among other topics of interest. We contacted 59% of shares outstanding and engaged with shareholders representing a combined 31% of shares outstanding. We leveraged those valuable insights to help build a set of potential compensation program changes for 2022.

 

SPRING 2021 Annual Meeting
SEPTEMBER 2021 Compensation-Focused Engagement: Gathered investor feedback on compensation programs and previewed potential enhancements				Evaluating
				Investor Feedback
49% of shares outstanding contacted	40% of shares outstanding engaged	34% of shares outstanding engaged with Lead Director and Chair of the Compensation Committee		The Compensation Committee reviewed shareholder feedback and approved a slate of meaningful executive compensation program changes outlined on page 43.
Shareholders were supportive of our proposed changes to our performance-based programs (PSP and VCIP), which were meaningful, and planned disclosure enhancements, including around goal-setting, metric selection, and peer group selection. See Taking Action in Response to Investor Feedback for additional detail. The feedback we heard directly informed the Compensation Committee’s decision-making regarding program changes for 2022.

 

 

NOVEMBER 2021 Follow Up Engagement:

Solicited additional investor perspectives on a full range of ESG topics

Following the compensation-focused discussions, we held conversations with over 20 shareholders representing a combined 40% of outstanding shares to discuss the Company’s business and ESG strategy, continuing Phillips 66’s long-standing shareholder engagement program. Outreach in this round of engagement included nearly all investors contacted in the compensation-focused engagement, and because of this, we met with a number of investors twice in fall 2021. Shareholders were supportive of responsive actions taken on climate matters, including setting robust GHG emissions reduction targets and publishing a climate lobbying report.

 

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Taking Action in Response to Investor Feedback

The table below details feedback we heard from our shareholders and the actions the Compensation Committee took to address shareholders’ views on our executive compensation program. The changes implemented in 2021 reflect our Board’s strong commitment to shareholder engagement. 

 

			What We Heard		Actions Taken in Response		Implemented for 2021 Performance Year
		Individual VCIP Modifier	●	Individual VCIP modifier allows for too much discretion	●	Removed positive individual performance modifier from VCIP for all NEOs
		Disclosure of Rigorous Performance Goals & Metric Selection	● ●	Explain how performance goals are set each year to ensure goals remain rigorous even if targets decrease on absolute terms Provide more explanation around the weighting and selection of VCIP metrics and rationale for payouts	● ●	Enhanced disclosures on goal setting, particularly where targets decrease on a year-over-year basis Enhanced disclosures of the weighting and selection of VCIP metrics and the rationale for payouts
		Consider Absolute TSR	●	Relative TSR drives 50% of the PSP, but there is no cap on payouts in the event of negative absolute TSR performance	●	Capped payout at 100% on TSR portion of PSP if absolute TSR is negative
		Rigor of Relative TSR Goal	●	Relative TSR pays at target for median performance	●	Require performance above the 50th percentile relative to peer group to achieve target payout	Changed for PSP 2022 - 2024
		Adjustments to Metrics	●	Limited disclosure of rationale for significant ROCE adjustment in FY20	●	Enhanced disclosures in proxy of rationale for any adjustments to financial results
		Selection & Rationale	●	Provide more explanation for the use of two peer groups and how the peers are determined	●	Enhanced disclosure about the peer group utilization and peer selection