UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
(Amendment No. )
| Filed by the Registrant | | Filed by a Party other than the Registrant |
| Check the appropriate box: | |
| Preliminary Proxy Statement |
| Confidential, for Use of the Commission Only (as permitted by Rule 14A-6(E)(2)) |
| Definitive Proxy Statement |
| Definitive Additional Materials |
| Soliciting Material under §240.14a-12 |
LyondellBasell Industries N.V.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
| Payment of Filing Fee (Check all boxes that apply): | |
| No fee required. |
| Fee paid previously with preliminary materials. |
| Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11. |
DEAR FELLOW SHAREHOLDERS
JACQUES AIGRAIN
Chair of the Board of Directors
April [ ], 2024 On behalf of the LYB Board of Directors, we are pleased to present our 2024 proxy statement. DELIVERING STRONG FINANCIAL RESULTS In 2023, LYB delivered resilient financial results amid challenging market conditions. We generated $4.9 billion in cash from operating activities and returned $1.8 billion to our shareholders through dividends and share repurchases, extending our track record of outstanding cash generation and strong returns. IMPLEMENTING OUR NEW STRATEGY TO GROW SUSTAINABLE VALUE Last year, we launched our three-pillar strategy to create a more profitable and sustainable growth engine for LYB. Our strategy focuses on three key initiatives: •Growing and upgrading the core; •Building a profitable Circular and Low Carbon Solutions (“CLCS”) business; and •Stepping up performance and culture. One year after launch, we are making significant progress on each pillar. In March 2023, we successfully started up the world’s largest propylene oxide (PO) and tertiary butyl alcohol (TBA) unit in Texas, which enables us to meet the growing demand for essential products. In early 2024 we entered into an agreement for a new propylene and polypropylene joint venture in Saudi Arabia. This year, we will continue to focus on efficiently growing and upgrading our core and expect to close the sale of our ethylene oxide and derivatives business. Following our final investment decision in 2023, we will also move forward on engineering and construction of our first advanced recycling plant using LYB’s proprietary MoReTec technology. Throughout the year, our CLCS business built strong foundations to secure feedstock supply, expand our recycling footprint, and develop scalable recycling technologies to support the reduction of plastic waste in the environment. In addition, we formed joint ventures to build plastics recycling infrastructure in Europe, Asia, and North America. We also achieved nearly 90% of our goal to procure half of our electricity from renewable sources and issued our inaugural green bonds to help advance LYB’s long-term sustainability goals. We are stepping up performance and culture with our Value Enhancement Program (VEP), which helped us double our original target for recurring annual EBITDA in 2023. Our new brand identity, revealed in October 2023, visually expresses our commitment and alignment to our strategy and purpose. Amid these big changes, we remain committed to our GoalZERO safety culture. In 2023, we extended our industry-leading safety record with a total recordable incident rate of 0.139 and a process safety incident rate of 0.035. We are proud that 60 of our manufacturing sites achieved GoalZERO, and 67 manufacturing sites were injury-free. ELECTING A DIVERSE AND QUALIFIED BOARD The Board is pleased to introduce our new director nominee, Bridget Karlin, the Senior Vice President of Information Technology, Services & Operations, at Kaiser Permanente, one of the largest not-for-profit health care systems in the U.S. Ms. Karlin brings over 30 years of experience in enterprise-wide digital technology to our Board. If each of our nominees is elected, four of our twelve directors will be women and fifty percent of our Board will be gender or racially diverse. SHAREHOLDER VOTING Your vote is important, and we encourage you to cast your vote as soon as possible to ensure your shares are represented at the meeting. Thank you for your investment in LyondellBasell Industries. | $4.9B CASH FROM $1.8B RETURNED TO | ||
| JACQUES AIGRAIN Chair of the Board | PETER VANACKER CEO | ||
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PETER VANACKER
| 2024Proxy Statement | LyondellBasell | 3 |
Chief Executive Officer
April [__], 2023
$6.1B
CASH FROM OPERATING ACTIVITIES
$3.7B
RETURNED TO SHAREHOLDERS
On behalf of theWe are LyondellBasell Board of Directors, we are pleased to present our 2023 proxystatement.
During 2022, LyondellBasell’s balanced business portfolio, excellent cash generation and strong, investment-grade balance sheet enabled us to navigate challenging market conditions while continuing to provide significant returns for our shareholders. We generated $6.1 billion in cash from operating activities, reinvested $1.9 billion in the business, and returned $3.7 billion to our shareholders through dividends and share repurchases, including a $1.7 billion special dividend.
LyondellBasell has a proven track record of operational excellence with leading market positions supported by best-in-class technologies and innovation. In 2023, we unveiled our new strategy to drive accelerated value creation by leveraging the strength of our core businesses to generate growth, shifting to a mindset that emphasizes entrepreneurship to unlock EBITDA improvements, and establishing a leadership position in sustainable solutions for our customers through our Circular and Low Carbon Solutions business.
This past December, we stepped up our climate goals and announced more ambitious GHG reduction targets for 2030. We increased our scope 1 and 2 reduction targets from 30% to 42%. In addition, we established a new goal to reduce scope 3 emissions 30% by 2030. We continue to strive towards net zero scope 1 and 2 emissions from global operations by 2050. We also continue to focus on our ambition to produce and market at least 2 million metric tons of recycled and renewable-based polymers annually by 2030, including through our Circular and Low Carbon Solutions business.
To support our long-term goals, in 2022 we focused on becoming– a leader in the global chemical industry creating solutions for everyday sustainable living. Through advanced technology and focused investments, we are enabling a circular and low carbon solutions. We implemented initiativeseconomy.
Across all we do, we aim to build upunlock value for our global circular feedstock supply, increase our Circulen product sales volumes,customers, investors and add to our renewable power capacity.
We remain committed to doing our part to address the global challenges posed by climate change and plastic waste, and to providing our stakeholders with transparency on our progress.
In 2022, the Board welcomed Peter Vanacker as our new CEO and executive director.society. As part of our leadership transition, the Company launched a comprehensive strategic review of its businesses, which resulted in, among other strategies, the creation of a new business unit for Circular and Low Carbon Solutions. To align our leadership with our evolving vision and strategy, in late 2022 the Company welcomed Yvonne van der Laan as our EVP of Circular and Low Carbon Solutions and Tracey Campbell as our EVP of Sustainability and Corporate Affairs. At the beginning of 2023, we also welcomed TrishaConley as our new EVP of People and Culture.
The Board would like to recognize retiring directors, Jagjeet Bindra and Nance Dicciani, who have been membersone of the LyondellBasell Board since 2011world’s largest producers of polymers and 2013, respectively,a leader in polyolefin technologies, we develop, manufacture and thank themmarket high-quality and innovative products for their guidanceapplications ranging from sustainable transportation and service. We are pleasedfood safety to introduce our new director nominee, Rita Griffin. Ms. Griffin is the former Chief Operating Officer for Global Petrochemicals at BP plc, one of three main divisions of the global energy provider’s downstream business,clean water and joins our Board with more than 30 years of experience in our industry.
Your vote is important, and we encourage you to cast your vote as soon as possible to ensure your shares are represented at the meeting. Thank you for your investment in LyondellBasell Industries.quality healthcare.
Creating solutions for everyday sustainable living
Our Values
Our values provide grounding in behaviors that ensure our team is achieving company objectives through a shared, unifying culture of commitment and purpose. We champion people We strive for excellence We shape the future | Our Commitments
We’re committed to delivering unique products and services in the following ways: Sustainability-focused innovation Outside-in perspective Ever-better performance Impactful collaboration |
countries where our | 20 countries with manufacturing | ~6,200 patents and patent | ~20,300 employees globally | ||||||||
#1 largest producer of | #1 largest producer of  |
 largest producer of | #2 largest producer of | ||||||||
| 2024Proxy Statement | LyondellBasell | 4 |
The statements in this proxy statement relating to matters that are not historical facts are forward-looking statements. These forward-looking statements are based upon assumptions of management of LyondellBasell which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. When used in this proxy statement, the words “estimate,” “believe,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “should,” “will,” “expect,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Actual results could differ materially based on factors including, but not limited to, our ability to attract and retain a highly skilled and diverse workforce; actions taken by customers, suppliers, regulators, and others in response to increasing concerns about the environmental impact of plastic in the environment or other general sustainability initiatives; our ability to meet our sustainability goals, including the ability to operate safely, increase production of recycled and renewable-based polymers, and reduce our emissions and achieve net zero emissions by the time set in our goals; our ability to procure energy from renewable and low carbon sources; water scarcity and quality; the pace of climate change and legal or regulatory responses thereto; and technological developments, and our ability to develop new products and process technologies. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the “Risk Factors” sections of our Form 10-K for the year ended December 31, 2022, which can be found at www.LyondellBasell.com on the Investor Relations page and on the Securities and Exchange Commission’s website at www.sec.gov. There is no assurance that any of the actions, events or results of the forward-looking statements will occur, or if any of them do, what impact they will have on our results of operations or financial condition. Forward-looking statements speak only as of the date they were made and are based on the estimates and opinions of management of LyondellBasell at the time the statements are made. LyondellBasell does not assume any obligation to update forward-looking statements should circumstances or management’s estimates or opinions change, except as required by law.
References to our website in this proxy statement are provided as a convenience, and the information on our website is not, and shall not be deemed to be a part of this proxy statement or incorporated into any other filings we make with the Securities and Exchange Commission.
| MEETING INFORMATION |
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| FRIDAY, MAY 24, 2024 8:00 a.m. Local Time | SHERATON HOTEL Schiphol Airport, Schiphol Blvd. 101 1118 BG, Amsterdam, the Netherlands |
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ITEMS OF BUSINESS | |
| 1. | Elect our Board of Directors; |
| 2. | Discharge our directors from liability in connection with the exercise of their duties during 2023; |
| 3. | Adopt our |
| 4. | Appoint the external auditor for our |
| 5. | Ratify the appointment of our independent registered public accounting firm; |
| 6. | Provide an advisory vote on our executive compensation (say-on-pay); |
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| Authorize the repurchase of up to 10% of our issued share capital; and |
| 8. | Approve the cancellation of all or a portion of the shares held in our treasury account. |
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We will also discuss our corporate governance, dividend policy, and executive compensation program.
By order of the Board,
CHARITY R. KOHL
Corporate Secretary
April [ ], 2024
HOW TO VOTE | |||||
Your vote is important. You are eligible to vote if you are a shareholder of record at the close of business on April | |||||
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If you are a registered shareholder, you may vote online at www.proxyvote.com, by telephone, or by mailing a proxy card. If you hold your shares through a bank, broker, or other institution, you may vote your shares through the method specified on the voting instruction form provided to you. You may also attend the annual general meeting in person. If you intend to attend the meeting, notice must be given to the Company on or before May | |||||
Important Notice Regarding Availability of Proxy Materials for the | |||||
This proxy statement and our | |||||
 | [ ], 2024. If you wish to receive future proxy statements and annual reports electronically rather than receiving paper copies in the mail, please see page | ||||
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| 2024Proxy Statement | LyondellBasell | 5 |
TABLE OF CONTENTS
FORWARD-LOOKING STATEMENTS The statements in this proxy statement relating to matters that are not historical facts are forward-looking statements. These forward-looking statements are based upon assumptions of management of LYB which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. When used in this proxy statement, the words “estimate,” “believe,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “should,” “will,” “expect,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Actual results could differ materially based on factors including, but not limited to, our ability to attract and retain a highly skilled and diverse workforce; actions taken by customers, suppliers, regulators, and others in response to increasing concerns about the environmental impact of plastic in the environment or other general sustainability initiatives; our ability to meet our sustainability goals, including the ability to operate safely, increase production of recycled and renewable-based polymers to meet our targets and forecasts, and reduce our emissions and achieve net zero emissions by the time set in our goals; our ability to procure energy from renewable sources; our ability to build a profitable Circular and Low Carbon Solutions business; our ability to successfully implement initiatives identified pursuant to our Value Enhancement Program and generate anticipated earnings; water scarcity and quality; the pace of climate change and legal or regulatory responses thereto; and technological developments, and our ability to develop new products and process technologies. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the “Risk Factors” sections of our Form 10-K for the year ended December 31, 2023, which can be found at www.LyondellBasell.com on the Investor Relations page and on the Securities and Exchange Commission’s website at www.sec.gov. There is no assurance that any of the actions, events or results of the forward-looking statements will occur, or if any of them do, what impact they will have on our results of operations or financial condition. Forward-looking statements speak only as of the date they were made and are based on the estimates and opinions of management of LYB at the time the statements are made. LYB does not assume any obligation to update forward-looking statements should circumstances or management’s estimates or opinions change, except as required by law. References to our website in this proxy statement are provided as a convenience, and the information on our website is not, and shall not be deemed to be a part of this proxy statement or incorporated into any other filings we make with the Securities and Exchange Commission. |
| 2024Proxy Statement | LyondellBasell | 6 |
This summary highlights information contained elsewhere in this proxy statement. The summary does not include all of the information you should consider before voting your shares, and we encourage you to read the full proxy statement carefully.
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Sheraton Hotel, Schiphol Airport |
Friday, April 26, 2024 |
Item | Board Recommendation | Page | |
1 | Election of 11 directors | FOR all nominees | 10 |
2 | Discharge of directors from liability | FOR | 37 |
3 | Adoption of Dutch statutory annual accounts | FOR | 37 |
4 | Appointment of auditor of Dutch statutory annual accounts | FOR | 38 |
5 | Ratification of independent registered public accounting firm | FOR | 38 |
6 | Advisory vote on executive compensation (say-on-pay) | FOR | 41 |
7 | Advisory vote on frequency of say-on-pay vote | FOR | 77 |
8 | Authorization to conduct share repurchases | FOR | 77 |
9 | Cancellation of shares | FOR | 78 |
| Item | Board Recommendation | Page | |||||
| 1 | Election of 12 directors |  | FOR all nominees | 10 | |||
| 2 | Discharge of directors from liability | | FOR | 40 | |||
| 3 | Adoption of Dutch statutory annual accounts | | FOR | 40 | |||
| 4 | Appointment of auditor of Dutch statutory annual accounts | | FOR | 41 | |||
| 5 | Ratification of independent registered public accounting firm | | FOR | 41 | |||
| 6 | Advisory vote on executive compensation (say-on-pay) | | FOR | 44 | |||
| 7 | Authorization to conduct share repurchases | | FOR | 84 | |||
| 8 | Cancellation of shares | | FOR | 85 | |||
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 | Annual election of directors | |
| Board diversity |
| Independent Board | |
| Code of Conductsupported by whistleblower helpline and robust compliance program |
| Independent Committees (100% of directors on each Board Committee are independent) | |
| Board engagementon strategy, long range planning, and capital allocation |
| Independent Board Chair | |
| Board oversightof enterprise risk management and sustainability strategy |
| Executive sessions at each regularly scheduled Board and Committee meeting | |
| Regular succession planningfor directors and executive management with focus on talent development |
| Annual self-assessmentsfor the Board and each Committee | |
| High director attendanceand engagement, with average meeting attendance of |
| Board refreshment supported by mandatory retirement age and annual Board self-assessments | |
| Stock ownership guidelines for directors and executives and policy against hedging and pledging the Company’s shares |
| 2024Proxy Statement | LyondellBasell | 7 |
LYONDELLBASELL 2023 PROXY STATEMENT 7
| Back to Contents |
All Committee memberships shown in the table below will be effective following the 20232024 annual general meeting, including Ms. Griffin’sKarlin’s Committee memberships. For more information about our 20222023 Committee membership, see “Board and Committee Information” on page 29.33.
Nominee | Age | Years of Service | Independent | Committee Memberships | Other Public Boards | ||||
Audit | C&TD | NomGov | HSE&S | Finance | |||||
Jacques Aigrain | 68 | 12 | YES |
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Lincoln Benet | 59 | 8 | YES |
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Robin Buchanan | 71 | 12 | YES |
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Anthony (Tony) Chase | 68 | 2 | YES | ● | ● |
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Robert (Bob) Dudley | 67 | 2 | YES |
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Claire Farley | 64 | 9 | YES | ● |
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Rita Griffin | 60 | Nominee | YES |
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Michael Hanley | 57 | 5 | YES | |
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Virginia Kamsky | 69 | 1 | YES |
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Albert Manifold | 60 | 4 | YES |
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Peter Vanacker | 57 | 1 | CEO |
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The Executive Committee of the Board consists of our Board Chair and Committee Chairs, each of whom is an independent director. | |||||||||
| Nominee | Age | Years of Service | Independent | Committee Memberships | Other Public Boards | ||||||||
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| Jacques Aigrain | 69 | 13 | YES |  | | | 2 | ||||||
| Lincoln Benet | 60 | 9 | YES | |  | 1 | |||||||
| Robin Buchanan | 72 | 13 | YES | | | 0 | |||||||
| Anthony (Tony) Chase | 69 | 3 | YES | | | 3 | |||||||
| Robert (Bob) Dudley | 68 | 3 | YES | | | 1 | |||||||
| Claire Farley | 65 | 10 | YES | | | 2 | |||||||
| Rita Griffin | 61 | 1 | YES | | | 0 | |||||||
| Michael (Mike) Hanley | 58 | 6 | YES | | | 1 | |||||||
| Virginia (Ginny) Kamsky | 70 | 2 | YES | | | 1 | |||||||
| Bridget Karlin | 67 | Nominee | YES | | | 1 | |||||||
| Albert Manifold | 61 | 5 | YES | | | 1 | |||||||
| Peter Vanacker | 58 | 2 | CEO | 1 | |||||||||
| Chair | Member | ||||||||||||
| 2024Proxy Statement | LyondellBasell | 8 |
LYONDELLBASELL 2023 PROXY STATEMENT 8
| Back to Contents |
In 2022, LyondellBasell provided significant returns for our shareholders while advancing our strategic priorities to build a stronger2023, LYB delivered resilient results and more sustainable future.outstanding cash conversion. Despite economic uncertainty and pressure from volatile energy and feedstock costsnew industry capacity and softer global demand, our businesses efficiently generated cash from a diverse business portfolio. We remain committed to a disciplined approach to capital allocation while advancing long-term strategies that capture value and accelerate sustainable growth.
| $2.1B | $5.2 | $1.8 |
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| Net Income | EBITDA Ex. Identified Items* | Returned To Shareholders |
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EBITDA
EX. IDENTIFIED ITEMS*
RETURNED TO SHAREHOLDERS
See Appendix A for information about our non-GAAP financial measures and a reconciliation of net income to EBITDA, including and excluding identified items. Identified items include adjustments for impairments and refinery exit costs.
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| Achieved robust cash generation |   | STRONG | Maintained a strong, investment-grade balance sheet and ample liquidity | ||||
  | SAFETY |
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| Delivered 13th consecutive year of regular dividend growth | |||
  | COST DISCIPLINE |
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|  | SUSTAINABILITY | Established our Green Financing Framework and issued inaugural green bonds | ||||
SUSTAINABILITY
Announced new climate ambition to reduce Scope 3 emissions by 30% by 2030, compared to a 2020 baseline
We are committed to a pay for performance philosophy, and our compensation programs align executive and shareholder interests by tying a significant amount of compensation to our financial, business, and strategic goals. Challenging market conditions impacted EBITDA, but our strong safety, cost and sustainability performance resulted in annual bonuses paying slightly above target. Our performance share units (“PSUs”) granted in 2020 under our long-term incentive program, with a three-year performance period ended December 31, 2022, earned 100% of target, reflecting the fact that our total shareholder return (“TSR”) matched the median TSR of selected peers. For PSUs granted in 2021, 2022 and 2023, payout will be based 50% on relative TSR (formerly our sole performance metric) and 50% on free cash flow per share. For more information on our annual bonus performance metrics, see “2022 Executive Compensation Decisions in Detail” on page 50.
Our Compensation and Talent Development (“C&TD”) Committee continually monitors compensation best practices, the effectiveness of our compensation programs, and their alignment with our compensation philosophy. In 2023, challenging market conditions impacted EBITDA, but our strong performance on the environmental, social and governance (ESG) metrics and achievement of milestones under our Value Enhancement Program resulted in annual bonuses paying slightly above target. Our performance share units (“PSUs”) granted in 2021 under our long-term incentive program, with a three-year performance period ended December 31, 2023, earned 200% of target, reflecting the fact that our total shareholder returns (“TSR”) fell in the top quartile of selected peers and our and free cash flow (“FCF”) per share exceeded targets set by our C&TD Committee. For more information on our annual bonus performance metrics, see “2023 Executive Compensation Decisions in Detail” on page 53.
| 2024Proxy Statement | LyondellBasell | 9 |
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LYONDELLBASELL 2023 PROXY STATEMENT 9
 | The Board recommends that you vote FOR the election of each of the nominees to our Board of Directors. |
The Board of Directors of LyondellBasell Industries N.V. (“LyondellBasell”LYB” or the “Company”) recommends that each of the eleventwelve director nominees introduced below be elected to our Board, in each case for a term ending at our 20242025 annual general meeting of shareholders. The nominees include teneleven current directors, who were elected by shareholders at the 20222023 annual general meeting, and new director candidate Rita Griffin. Jagjeet Bindra and Nance Dicciani have reached our mandatory retirement age and are not standing for re-election.Bridget Karlin.
Our goal is to have a Board that provides effective oversight of the Company through the appropriate balance of experience, expertise, skills, competencies, specialized knowledge, and other qualifications and attributes. Director candidates also must be willing and able to devote the time and attention necessary to engage in relevant, informed discussion and decision-making. Our Nominating and Governance Committee focuses on Board succession planning and refreshment and is responsible for recruiting and recommending nominees to the full Board for election. The Committee considers the qualifications, contributions, and outside commitments of each current director, as well as the results of annual Board self-assessments and management assessments, in determining whether he or she should be nominated for reelection. Many of our directors serve on the boards and board committees of other companies, and the Committee believes this service provides additional experience and knowledge that improve the functioning of our own Board. Our Board Profile, which is available on our website, provides general principles for the composition, expertise, background, diversity and independence of the Board and guides our Nominating and Governance Committee on the nomination and appointment of directors.
Our Board considers diversity a priority and seeks representation across a range of attributes, including race, gender, ethnicity, and nationality. Our Board remains committed to increasing the representation of women in its membership and targets at least one-third female directors, alongside continued focus on increasing the racial and ethnic diversity of the Board. While we have not yet achieved our goal of at least one-third female directors, which was originally targeted by 2023, our current director nominees include three women. Our Nominating and Governance Committee is continuing to evaluate candidates to fill the vacancy on our Board following our 2023 annual general meeting. In accordance with our Corporate Governance Guidelines, the Committee and any outside search firms engaged to assist in identifying potential director candidates include women and minority candidates from underrepresented populations in each pool from which a director candidate is selected. These recruitment efforts are evidenced by our current Board composition and the qualities and qualifications of our nominees. If each of our twelve director nominees for 2024 is elected, we will meet our goal of appointing at least one-third female directors.
Our director nominees provide the Board with a broad range of perspectives due to their diverse gender, race, ethnicity, nationality, age, and tenure profiles, as well as the qualifications and skills identified below. Each of the teneleven non-executive directors nominated to our Board is independent.independent, and 50% of our director nominees are gender, ethnically or racially diverse. This section provides information on our director nominees for the 20232024 annual general meeting. For more information about our current Board as of the date of this proxy statement, see “Board and Committee Information” on page 29.33.
LYONDELLBASELL 2023 PROXY STATEMENT 10
| 2024Proxy Statement | LyondellBasell | 10 |
| DIRECTOR EXPERIENCE AND EXPERTISE |  |   |   |   |   |   |   |   |   |   |   |  |  | ||
  | INDUSTRY EXPERIENCE Experience with and understanding of the chemicals and refining industries |
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  | CORPORATE FINANCE Financial expertise and experience with corporate finance |
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  | EXECUTIVE MANAGEMENT / CEO EXPERIENCE Executive management experience with large or international organizations |
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  | CORPORATE GOVERNANCE Knowledge of corporate governance issues applicable to companies listed on the NYSE |
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  | RISK MANAGEMENT Experience identifying, managing, and mitigating key enterprise risks |
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  | PUBLIC COMPANY DIRECTOR Service on the boards of other public companies |
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 | PUBLIC POLICY AND COMPLIANCE Government relations, legal, regulatory compliance and/or public policy experience | | | | | | | | |||||||
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| 2024 Proxy Statement | LyondellBasell | 11 |
LYONDELLBASELL 2023 PROXY STATEMENT 11
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A shareholder who wishes to recommend a director candidate should submit a written recommendation to our Corporate Secretary The Corporate Secretary may request additional information to assist the Nominating and Governance Committee in its evaluation. Our Nominating and Governance Committee uses the same process to evaluate shareholder nominees as it does in evaluating nominees identified by other sources. For our |
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BY MAIL LyondellBasell Industries N.V. |
On the recommendation of the Nominating and Governance Committee, the Board has nominated teneach of the eleven directors elected by shareholders at our 20222023 annual general meeting and one new director nominee, Rita Griffin.Bridget Karlin. In evaluating these nominees, the Nominating and Governance Committee considered the Board’s 2023 director self-assessments and management evaluations, as well as each nominee’s background and skill set. These eleventwelve individuals have a diverse array of expertise, experience, and leadership skills.skills that support the Company’s strategy evolution. Each nominee has consented to serve as a director if elected. Jagjeet Bindra and Nance Dicciani are not standing for re-election as they have reached our mandatory retirement age.
We introduce our eleventwelve nominees below. All Committee memberships shown in this section will be effective following the 20232024 annual general meeting. For more information about our current Board and Committee membership as of the date of this proxy statement, see “Board and Committee Information” on page 29.33.
| 2024Proxy Statement | LyondellBasell | 12 |
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French-Swiss Non-Executive Director since 2011; INDEPENDENT Committees
• Nominating and Governance Committee • Finance Committee |
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Mr. Aigrain is our Chair of the Board and a retired Senior Advisor and Partner of Warburg Pincus, a global private equity firm. Prior to joining Warburg Pincus in 2013, Mr. Aigrain | ||||
| Skills And Qualifications | |||
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• Corporate Finance • Risk Management • Mergers & Acquisitions • International Operations | •Corporate Governance | •
• Capital Markets | •CEO Experience • Public Company Director • Public Policy and Compliance | |
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• Clearwater Analytics Holdings Inc. (since 2021) • TradeWeb Markets Inc. (since 2022) | Former Public Directorships • The London Stock Exchange Group plc (2013-2022) • WPP plc (2013-2022) | |||
LYONDELLBASELL 2023 PROXY STATEMENT 12
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American-British Non-Executive Director since 2015 INDEPENDENT Committees
• Finance Committee (Chair) |
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Mr. Benet has served as Chief Executive Officer of Access Industries, a privately held industrial group with world-wide holdings, since 2006. Prior to joining Access, he spent 17 years at Morgan Stanley, including as Managing Director. Mr. Benet also has experience serving on the boards of several privately held and publicly traded companies, including those in the investment, music and publishing, oil and gas pipes and tubing, cement, sports media, and petrochemicals industries. As a result of this background, he brings to our | ||||
| Skills And Qualifications | |||
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Mergers & Acquisitions • International Operations • | •Corporate Governance | • Corporate Finance • Risk Management • | •Capital Markets • CEO Experience • Public Company Director • Public Policy and Compliance | |
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• Warner Music Group Corp. (since 2011; public since 2020) | ||||
| 2024 Proxy Statement | LyondellBasell | 13 |
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British Non-Executive Director since 2011 INDEPENDENT Committees
• Nominating and Governance Committee |
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Mr. Buchanan has previously served as Dean and President of London Business School, the Chairman of PageGroup plc, a global specialist recruitment company, a director of Schroders plc, a global asset management firm, a director of Cicap Ltd, a global private equity firm, and a director of Bain & Company Inc., a global business consulting firm. As the former Managing Partner of Bain in the UK and Senior Partner for the UK and South Africa, he continues to serve in an advisory role to Bain. Until August 2023, Mr. Buchanan also | ||||
| Skills And Qualifications | |||
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Industry Experience • •Mergers & Acquisitions • Corporate Finance • Corporate Accounting | •International Operations | • Leadership Development • Executive Management • Risk Management • Corporate Governance | •Public Company Director • Human Capital Management • Technology and Innovation • Public Policy and Compliance | |
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• Schroders plc (2010-2019) | ||||
LYONDELLBASELL 2023 PROXY STATEMENT 13
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American Non-Executive Director since 2021 INDEPENDENT Committees
• C&TD Committee |
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Mr. Chase is the Chairman and Chief Executive Officer of ChaseSource, L.P., a staffing, facilities management, and real estate development firm founded by him in 2006 and recognized as one of the nation’s largest minority-owned businesses by Black Enterprise Magazine. Prior to ChaseSource, Mr. Chase founded and sold three successful ventures: Chase Radio Partners, Cricket Wireless and ChaseCom. He is also a principal owner of the Marriott Hotel at George Bush Intercontinental Airport in Houston and the Principle Toyota dealership in greater Memphis. He currently serves as a director of Cullen/Frost Bankers, Inc., a financial holding company, Nabors Industries, an operator of drilling rig fleets and provider of offshore platform rigs, and Par Pacific Holdings, Inc., an oil and gas exploration and production company. Mr. Chase | ||||
| Skills And Qualifications | |||
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• CEO Experience • Risk Management • Mergers & Acquisitions | •HSE Experience | • Strategic Planning • Corporate Governance | •Corporate Finance • Public Company Director | |
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Other Current Public Directorships • Nabors Industries Ltd. (since 2019) • Cullen/Frost Bankers, Inc. (since 2020) • Par Pacific Holdings, Inc. (since 2021) | Former Public Directorships • Anadarko Petroleum Corp. (2014-2019) • Paragon Offshore plc (2014-2017) • Heritage-Crystal Clean, Inc. (2020-2022) | |||
| 2024 Proxy Statement | LyondellBasell | 14 |
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American-British Non-Executive Director since 2021 INDEPENDENT Committees
• HSE&S Committee |
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Mr. Dudley is Chairman of the international industry-led Oil and Gas Climate Initiative, which aims to accelerate the oil and gas industry’s response to climate change, and Chair of the Accenture Global Energy | |||||
| Skills And Qualifications | |||||
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•
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CEO Experience • Risk Management • HSE Experience • Industry Experience | •Public Company Director • Climate Expertise | •
• International Operations | •Mergers & Acquisitions •
• Corporate Governance | ||
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Other Current Public Directorships • Freeport-McMoRan Inc. (since 2021) | Former Public Directorships • Rosneft Oil Company (2013-2022) • BP plc (2009-2020) | ||||
LYONDELLBASELL 2023 PROXY STATEMENT 14
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American Non-Executive Director since 2014 INDEPENDENT Committees
• Nominating and Governance Committee (Chair) |
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Ms. Farley | ||||
| Skills And Qualifications | |||
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• CEO Experience •
• Risk Management • | •Public Company Director • Capital Markets | • Corporate Governance | • Corporate Finance
• Mergers & Acquisitions • International Operations | |
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Other Current Public Directorships • TechnipFMC plc (since 2017) • Crescent Energy Company (since 2021) | Former Public Directorships • Anadarko Petroleum Corporation (2017-2019) | |||
| 2024 Proxy Statement | LyondellBasell | 15 |
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American Non-Executive Director INDEPENDENT Committees
• HSE&S Committee (Chair) |
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Ms. Griffin served as the Chief Operating Officer of Global Petrochemicals at BP plc, one of three main divisions of BP’s downstream business, from 2015 to 2020. Previously, she served in a number of leadership positions within BP plc’s manufacturing, logistics, retail and functional organizations. Ms. Griffin began her career at Amoco and Standard Oil (Indiana), which was acquired by BP plc in 1998. She is a Certified Public Accountant and Certified Managerial Accountant, and received her master of management from Northwestern University and bachelor of business administration in accounting from Northern Illinois University. With over 30 years of experience in global oil and gas and chemicals businesses, Ms. Griffin has considerable experience in developing and implementing strategies and leading substantial transformation programs. She has previously served on the board of directors of Royal Mail Group PLC, an international postal service and courier | ||||
| Skills And Qualifications | |||
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• Industry Experience • HSE Experience • Capital Project Execution • Mergers & Acquisitions | •Public Company Director | • International Operations •
• Risk Management | • Executive Management •Corporate Finance • Corporate Governance • Human Capital Management | |
| Former Public Directorships | |||
• Royal Mail Group PLC (2016-2022) | ||||
LYONDELLBASELL 2023 PROXY STATEMENT 15
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Canadian Non-Executive Director INDEPENDENT Committees
• Finance Committee |
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Mr. Hanley has more than | ||||
| Skills And Qualifications | |||
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• Corporate Finance •
• Risk Management • International Operations • Public Company Director | • Corporate Accounting • Capital Markets • • Mergers and Acquisitions •Executive Management | •Corporate Governance • Human Capital Management • Technology and Innovation • Public Policy and Compliance | ||
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EQB Inc. (since 2022) | Former Public Directorships • •BRP, Inc. (2012-2022) • Shawcor Ltd. (2015-2021) • Industrial Alliance Insurance & Financial Services (2015-2019) • Groupe Jean Coutu (PJC), Inc. (2016-2018) | |||
| 2024 Proxy Statement | LyondellBasell | 16 |
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American Non-Executive Director since 2022 INDEPENDENT Committees
• HSE&S Committee |
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Ms. Kamsky is the Chair and Chief Executive Officer of Kamsky Associates, Inc., a firm she founded in 1980 | ||||
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| Skills And Qualifications | |||
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• CEO Experience •
• Risk Management • • Information Systems and Security | •Public Company Director • Capital Markets • HSE Experience • Corporate Finance • Technology and Innovation | • Corporate Governance •
Mergers & Acquisitions • International Operations • Human Capital Management • Public Policy and Compliance | ||
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• Dana Incorporated (Since 2011) | Former Public Directorships • Kadem Sustainable Impact Corp. (2021-2023) | |||
 | Bridget Karlin, 67 American Non-Executive Director Nominee INDEPENDENT Committees • Audit Committee • Nominating and Governance Committee |
Biography Ms. Karlin is the senior vice president of information technology for Kaiser Permanente, one of the nation’s largest not-for-profit health care systems, where she is responsible for the information technology, services and operations that power Kaiser Permanente’s business. Previously, she served as the global chief technology officer and vice president of IBM’s multi-billion-dollar Global Technology Services business from 2017 to 2021. Before joining IBM, she held senior leadership roles at Intel Corporation, as general manager of its Internet of Things division, and prior to that, as general manager of Intel’s Hybrid Cloud business. Additionally, she has served in executive positions at Union Bank, as managing director at Redleaf Venture Capital, and was president and co-founder of Thinque Systems, a pioneer in mobile software deployed in 43 countries. Ms. Karlin has extensive experience leading the strategy, development, and services for a hybrid, multi-cloud enterprise IT environment, leveraging artificial intelligence, automation, security, cloud, and open-source technologies to strengthen resiliency and ensure compliance, and modernizing offerings and capabilities across applications and infrastructure environments. With a career in the technology industry that spans over 30 years, including several executive positions at large international companies, she has considerable experience in advanced technology and enterprise-wide digital transformation. She currently serves on the Executive Board of the Consumer Technology Association, a non-profit organization that represents the U.S. consumer technology industry. Ms. Karlin is a graduate of the University of California and the Harvard Business School Executive Leadership Program, and is a recipient of the 2023 Digital Innovator Award, 2021 Technology Hall of Fame, the 2019 National Technology Humanitarian Award, the 2019 Women in Consumer Technology Legacy Award, the Industrial IoT 5G Innovators Award, the Malcolm Baldrige National Quality Award, and the Bell Labs Technology Innovator Award. | ||||
| Skills And Qualifications | ||||
• Information Systems and Security • Technology and Innovation • Corporate Strategy | • Corporate Governance • Risk Management • Public Company Director | • HSES Experience • Human Capital Management • Executive Management | ||
Other Current Public Directorships • Dana Incorporated (since 2019) | ||||
| 2024 Proxy Statement | LyondellBasell | 17 |
LYONDELLBASELL 2023 PROXY STATEMENT 16
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Irish Non-Executive Director INDEPENDENT Committees
• HSE&S Committee |
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Mr. Manifold has been the Group Chief Executive and a director of CRH plc, an international group of diversified building materials businesses supplying the construction industry, since 2014. Mr. Manifold joined CRH in 1998 and advanced to increasingly senior roles, including Finance Director of the Europe Materials Division, Group Development Director, Managing Director of Europe Materials, and Chief Operating Officer (2009 to 2014). Prior to joining CRH, Mr. Manifold was Chief Operating Officer of Allen McGuire & Partners, a private equity group. As a sitting | ||||
| Skills And Qualifications | |||
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• Corporate Finance • International Operations • Corporate Accounting • • Human Capital Management | •Risk Management • Mergers & Acquisitions | • CEO Experience • • Public Policy and Compliance | •Capital Markets •
• Capital Project Execution • Public Company Director | |
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• CRH plc (since 2009) | ||||
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Belgian-German Executive |
| Biography | |||
| Mr. Vanacker has served as our Chief Executive Officer since May 2022. Mr. Vanacker previously served as the President, | ||||
| Skills And Qualifications | |||
•Industry Experience • HSE Experience • CEO Experience • Corporate Finance • Risk Management | •
• Capital Project Execution • International Operations • Mergers & Acquisitions • Technology and Innovation | • Corporate Governance • Public Company Director • Public Policy and Compliance • Human Capital Management | ||
| Other Current Public Directorships | |||
• Symrise AG (since 2020) | ||||
| 2024 Proxy Statement | LyondellBasell | 18 |
LYONDELLBASELL 2023 PROXY STATEMENT 17
| Back to Contents |
LyondellBasell
LYB recognizes the importance of good corporate governance as a driver of long-term stakeholder value. Our Board has adopted, and regularly reviews and strives to improve upon, LyondellBasell’sLYB’s robust corporate governance policies, practices, and procedures with consideration given to regulatory developments and evolving U.S. and Dutch governance best practices.
Our governance guidelines and policies, including those listed below, are available on our website at www.LyondellBasell.com by clicking either (i) “Investors,” then “Corporate Governance” and “Board of Directors” or (ii) “Sustainability,” then “Reporting.”
 | |||
| Corporate Governance Guidelines | | Rules for the Board of Directors |
  | Articles of Association | | Committee Charters |
| Code of Conduct | | Board Profile |
| Financial Code of Ethics | | Tax Strategy Disclosure |
| Conflict Minerals Policy | | Human Rights Policy |
| Human Trafficking and Anti-Slavery Statement | | Supplier Code of Conduct |
| Health, Safety, Environment, Security Policy | | Stakeholder Engagement Policy |
Our Board annually reviews the independence of its members. In February 2023,2024, the Board affirmatively determined that all of our non-executive directors and director nominees are independent under the rules of the New York Stock Exchange (the “NYSE”).
The Board has adopted categorical standards of independence that meet, and in some instances exceed, the requirements of the NYSE. In order to qualify as independent under our categorical standards, a director must be determined to have no material relationship with LyondellBasellLYB other than as a director. The categorical standards include strict guidelines for non-executive directors and their immediate families regarding employment or affiliation with LyondellBasellLYB and its independent registered public accounting firm. Our categorical independence standards are included in our Corporate Governance Guidelines.
The Board has determined that there are no relationships or transactions that prohibit any of our non-executive directors or nominees from being deemed independent under the categorical standards and that each of our non-executive directors and nominees is independent. In addition to the relationships and transactions that would bar an independence finding under the categorical standards, the Board considered all other known relationships and transactions in making its determination, including those referenced under “–Other Governance Matters–Related“Related Party Transactions.”Transactions” on page 88. In determining that no known transactions or relationships affect the independence of any of the non-executive directors, the Board considered that all of the identified transactions are ordinary course and none of the dollar amounts involved were material to the Company or the relevant counterparty.
| 2024Proxy Statement | LyondellBasell | 19 |
Jacques Aigrain has led our Board as its independent Chair since 2018. The Chair’s responsibilities include:
Leading Board meetings and executive sessions
| • | Leading Board meetings and executive sessions |
| • | Reviewing and approving Board meeting agendas and schedules, and ensuring there is sufficient time for discussion of topics |
| • | Convening additional Board meetings, as needed |
| • | Facilitating information flow and communication among directors |
| • | Serving as a liaison between the independent directors and the CEO and other members of management |
| • | Together with the C&TD Committee, setting annual and long-term performance goals for the CEO and evaluating his performance |
| • | Presiding at general meetings of shareholders |
| • | Meeting or engaging with shareholders, as appropriate |
| • | Supporting the Company’s strategic growth initiatives |
Reviewing and approving Board meeting agendas and schedules, and ensuring there is sufficient time for discussion of topics
Convening additional Board meetings, as needed
Facilitating information flow and communication among directors
Serving as a liaison between the independent directors and the CEO and other members of management
Together with the C&TD Committee, setting annual and long-term performance goals for the CEO and evaluating his performance
Presiding at general meetings of shareholders
Meeting or engaging with shareholders, as appropriate
Supporting the Company’s strategic growth initiatives
LYONDELLBASELL 2023 PROXY STATEMENT 18
The Board regularly reviews LyondellBasell’sLYB’s leadership structure and the responsibilities of its Chair, and may from time to time delegate additional duties to the role.
Under Dutch law, only a non-executive director may serve as Chair of our Board. Our Board believes that the separation of the positions of Chair and Chief Executive Officer that results from this governance structure promotes strong Board governance, independence, and oversight. The separation of the two roles additionally allows Mr. Aigrain to focus on managing Board matters while our CEO, Mr. Vanacker, focuses on managing our business.
Executive sessions of our independent directors, with no members of management present, take place at every regularly scheduled Board and committee meeting. During executive sessions, independent directors have an opportunity to meet with the Board’s outside consultants and independent accountants and review and discuss any matters they deem appropriate, such as the performance of the Chief Executive Officer and other members of management and the criteria against which performance is evaluated, including the impact of performance on compensation matters. Mr. Aigrain leads these executive sessions of the Board.
Our Board and its committees evaluate their own effectiveness by participating in a robust annual self-assessment process overseen by the Nominating and Governance Committee. Each year, directors respond to survey questions soliciting information used to improve the effectiveness of the Board and its committees and individual directors. The Nominating and Governance Committee periodically engages independent outside consultants, including most recently in 2020, to conduct interviews with the Board and facilitate the evaluation process. The Nominating and Governance Committee intendshas engaged an independent outside consultant to continue engaging third parties periodicallybegin work in 2024 in order to refresh and bring an outside perspective to the evaluation process.
| 2024Proxy Statement | LyondellBasell | 20 |
For 2022,2023, the Board conducted its evaluation process as described below.
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| 1 | ||||
Development and Approval of Evaluation Process and Topics | In September | |||
2 | ||||
Distribution and Completion of Surveys |
Board members provided responses to the surveys, Key areas covered in the Board and committee surveys include membership; responsibilities; functionality; meetings; strategy; senior management (including succession planning); focus on performance; ensuring financial robustness; monitoring risk; compliance; and building corporate | |||
3 | ||||
| The Corporate Secretary compiled feedback from the self-evaluation process, including feedback from senior executives, which was discussed during the February | |||
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| Policies and practices were evaluated based on the self-assessment results, Feedback from the process will also be provided to the independent outside consultant as part of the 2024 evaluation process, and may be used to refresh the evaluation process and adjust areas of focus for surveys |
| 2024Proxy Statement | LyondellBasell | 21 |
LYONDELLBASELL 2023 PROXY STATEMENT 19
| Back to Contents |
Our Board is committed to understanding its governance responsibilities, evolving best practices, and all aspects of our Company and business. The Company provides an extensive orientation program that enables each new director joining the Board to become familiar with LyondellBasellLYB and to meet with key members of the Company’s management and functional leaders. All of our non-executive directors complete our onboarding program and meet with the Company’s Chief Executive Officer, Chief Financial Officer, General Counsel, Chief Compliance Officer, and the other members of our Executive Vice President, Sustainability and Corporate Affairs and additional executivesCommittee to discuss our corporate structure, business strategy, operations, and segments, as well as compliance, investor relations, human resources, tax, accounting, and health, safety, environment, and environment (HSE)sustainability matters, including sustainability reporting, among other topics. Ms. Griffin completed our onboarding program prior to her nomination and has attended Board and Committee meetings as an observer since November 2022.
All of our directors are encouraged to participate in industry and governance organizations and seek out training opportunities that will provide them with continuing education on key topics. The Company will reimburse directors for the costs of such continuing education. During Board meetings, our directors hear from management on a wide range of subjects, including regulatory developments, shareholder updates, and environmental, social, and corporate governance issues and trends. Our directors also have regular opportunities to visit the Company’s manufacturing and technology centers and meet with site management. During 2022, multipleIn November 2023, nine members of our Board toured the Company’s propylene oxide and tertiary butyl alcohol (PO/TBA) plant construction site at Channelview.Houston Technology Center. In addition, Mr. Bindra, our former Chair of the HSE&S Committee alsowho retired in May 2023, visited our Ferrara, Italy site and Technical Center.Fos-sur-Mer, France facility in April 2023.
We recognize the value of regular and consistent communication with our shareholdersstakeholders, and engage with our investors and other stakeholders on strategy, risk management, sustainability, corporate governance, executive compensation, and other matters. In 2023, our Board adopted a Stakeholder Engagement Policy, which is available on our website, to outline our values and approach to stakeholder engagement, including shareholders. We regularly review general governance trends and emerging best practices and welcome feedback from our shareholders and other stakeholders, which is brought to our Board and helps inform its decision-making processprocess.
We recognize the vital role that stakeholders play in our business operations and understandingthe importance of corporate governance trendsfostering positive, collaborative relationships with them. We engage daily with stakeholders globally covering a wide variety of topics and best practices. issues, including through investor events, telephone and in-person conversations, employee discussions and surveys, customer discussions and surveys, community and local engagements, and social media interactions. We know that our stakeholders have a broad range of interests, and we strive to seek their input, listen to their perspectives and expertise, and prioritize and integrate their feedback in a strategic and sustainable manner. We recognize that different stakeholder groups have unique needs and expectations, and we tailor our engagement practices to ensure effective communication and collaboration with each group.
Engagement with shareholders occurs in one-on-one meetings and calls with shareholder representatives, at our annual general meeting of shareholders, and through our regular participation in industry conferences, investor road shows, and analyst meetings.
In 2022, we engaged an external advisory firm to evaluate our investor relations and engagement strategy, identify shareholder priorities, and address opportunities for growth. In addition, throughout the year, Throughout 2023, we discussed the Company’s strategy and environmental, social, and governance profile with multiple investors and engaged with their questions or concerns on these and other topics. Our Chief Sustainability Officer regularly joins meetings to discuss our climate and sustainability ambitions. In addition, our independent Board Chair has joined these discussions when requested. Management updates the Board regularly on conversations with shareholders and feedback received. We are committed to remaining proactive in our engagement efforts and shareholder outreach.
| 2024Proxy Statement | LyondellBasell | 22 |
Shareholders and other interested parties may communicate with the Board or any individual director. Communications should be addressed to our Corporate Secretary by email or regular mail. Communications are distributed to the Board or to one or more individual directors, as appropriate, depending on the facts and circumstances outlined in the communication. Communications such as business solicitations or advertisements; junk mail and mass mailings; new product suggestions; product complaints; product inquiries; and resumes and other forms of job inquiries will not be relayed to the Board. In addition, material that is unduly hostile, threatening, illegal, or similarly unsuitable will be excluded. Any communication that is filtered out is made available to any director upon request. |
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BY EMAIL |
send an email to | |||
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BY MAIL | ||
| LyondellBasell Industries N.V. c/o Corporate Secretary 4th Floor, One Vine Street London W1J 0AH, United Kingdom |
LYONDELLBASELL 2023 PROXY STATEMENT 20
One of the primary responsibilities of the Board is to ensure that we have a high-performing management team in place. On at least an annual basis, and as needed throughout the year, the Board conducts a detailed review of development and succession planning activities to maximize the pool of internal candidates who can assume executive officer positions without undue interruption. The Board reviews CEO and executive succession planning and ensures that executive officer reviews and evaluations are conducted at least annually by the C&TD Committee and the Board as a whole. The Board also reviews in-depth assessments of the Company’s bench strength, retention, progression, and succession readiness for all other senior level managers.
In August 2021, our former CEO gave notice of his intention to retire from LyondellBasell at the end of 2021. Our Board acted swiftly to organize a Selection Committee and execute on existing leadership development andmanagers, including succession plans to appoint Kenneth Lane, our EVP, Olefins and Polyolefins, as interim CEO effective January 1, 2022. In late 2021 and early 2022, the Board completed a thorough CEO selection process that resulted in the appointment of Peter Vanacker as the Company’s new CEO effective May 23, 2022.
In 2022, the Company successfully executedfor the CEO, his direct reports, and senior leadership transition as a result of the succession planning process that the Board undertook starting in 2021. As part ofother employees critical to our leadership transition, the Company launched a comprehensive strategic review of its businesses, which resulted in, among other strategies, the creation of a new business unit for Circularcontinued operations and Low Carbon Solutions. To align our leadership with our evolving vision and strategy, we welcomed Yvonne van der Laan as our EVP of Circular and Low Carbon Solutions, Tracey Campbell as our EVP of Sustainability and Corporate Affairs, and Trisha Conley as our EVP of People and Culture.success.
Monitoring the Company’s leadership development, talent management, and succession planning is also a key responsibility of our C&TD Committee, which devotes significant time to discussion and oversight of the Company’s human resources strategy. Our strategy includes efforts to hire, retain, and fairly compensate a diverse and representative workforce.
| 2024Proxy Statement | LyondellBasell | 23 |
Our success as a company is tied to the passion, knowledge, and talent of our global team. To achieve our visionpurpose of being the best operated and most valued company in the industry,creating solutions for everyday sustainable living, we must attract top performers and equip them with the tools needed to continuously grow and leverage their potential.
What We Do |  | ||
|  We believe in integrity, diversity, and fairness | ||
| We focus on creating a work environment that is safe, respectful, and inspires employees to strive for excellence | ||
| We believe in championing our employees and the | ||
| We reward performance based on personal, team, and company results | ||
| We engage in open and ongoing dialogue with employees and their representatives to ensure a proper balance between the best interests of the Company and its employees | ||
| We have a | ||
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Our culture reflects the role we seek to play in the world, what we uniquely deliver, and how we behave day to day. In 2023, LYB introduced a new long-term strategy and began the transformation of our company culture. Along with our new strategy, we identified three core values: We continuedChampion People, We Strive for Excellence, and We Shape the Future. As part of our work last year, we established a cultural steering team and initiated a cultural ambassador program to support workplace flexibilityhelp drive our work in 2022 asadvancing the transformation.
To reflect our new strategy and values, we refreshed our “LYB competencies,” which provide a result of feedbackframework for how we received from employees expressing a desire for more flexible work policies. Whilebehave day to day to help us achieve our strategic goals. They inform the easing of governmental restrictions relatedway we hire, reward, develop, and retain our employees. Our LYB competencies focus on five key areas: Building Partnerships, Delivering Results, Driving Innovation, Growing Capabilities, and Promoting Inclusion. We introduced the new competencies to the COVID-19 pandemic has alleviated the need for remote working, employees have appreciated and embraced this flexibility. Basedorganization in part on data from employee surveys, we enhanced our workplace flexibility initiative in early 2023 by offering up to three remote days per work week to employees whose job duties can be performed remotely as determined by the Company. These changes have helped to attract and retain employees in a competitive market for talent. We will continue to study the effectiveness of this policy and will make changes,be further integrating them into our programs in 2024.
A key tenant of our culture is what we call GoalZERO. GoalZERO is our commitment to operating safely with zero injuries and zero process safety, product safety and environmental incidents. We cultivate a GoalZERO mindset with clear standards, regular communication, training, targeted campaigns and events, including our annual Global Safety Day. In 2023, we extended our industry-leading safety record with a total recordable incident rate of 0.139 and a process safety incident rate of 0.035. 60 of our manufacturing sites achieved GoalZERO, and 67 manufacturing sites were injury-free. As we accelerate our cultural transformation, we remain committed to our pursuit of GoalZERO safety performance and operational excellence.
Our vision for the future is that LYB is a place where necessary, to support business needs.
LYONDELLBASELL 2023 PROXY STATEMENT 21
there is genuine equal opportunity for all and DEI is embedded within our culture as deeply as safety. DEI remained a key focus in 2022.2023. Our efforts reflect a holistic, multi-year strategy to improve representation, ensure fairness, and increase visibility and accountability to leadership.
| 2024Proxy Statement | LyondellBasell | 24 |
DiversityCultivating a diverse workforce has a powerful impact on our culture and performance by broadening the perspectives and experiences represented in our organization. In 2022, we set five-year goals to increase the number of female senior leaders globally to at least 33% and the number of senior leaders from underrepresented populations in the U.S. to at least 29%, representing 50% increases in both groups relative to a 2022 baseline. In the long term, we have committed to achieving gender parity in global senior leadership (i.e., approximately 50% women and 50% men) and population parity in U.S. senior leadership (i.e., representation of underrepresented populations equal to their proportion of the U.S. population) by 2032. Our DEI goals help us retain and attract top talent and reflect the input of our employees, customers, communities, investors and other stakeholders.
The
In 2023, we made progress towards our goals. As of December 31, 2023, women served in 25% of global senior leadership roles, an increase from 22% in 2022. In the U.S., 19% of senior leaders were from underrepresented populations, consistent with the prior year. Our Executive pay band (the highest level of leadership) also experienced representation growth in women and underrepresented populations. Women now make up 27% of this band, an increase from 24% in 2022, while the percentage of diverse employeesindividuals from underrepresented populations grew from 19% in 2022 to 23% in 2023. Of the ten members on our Executive Committee, comprised of senior executives who lead LyondellBasell’s businesses and functions, and report directly to our CEO, increased from 18% in 2021 to 33% in 2022, and as of February 2023, has increased to 40%. Of the ten members on our Executive Committee, four are women, and together, our CEO and Executive Committee represent six different nationalities. This
Our increase brings us closerin female representation is the result of increased external hiring and exceptional retention performance. In 2023, the attrition rate of female employees decreased from 9% in 2022 to 3% in 2023. We attribute part of this success to our long-term goals of achieving gender parity (approximately 50% womenfocus on talent development and 50% men) in global senior leadership. We are also committed to increasing the number ofoffering a compelling employee value proposition. For employees from underrepresented senior leaders (“URP”) in the U.S. to reflect the general population ratio by 2032. To meet these targets, we have set short-term goals to increase the number of female senior leaders globally and the number of underrepresented senior leaders in the U.S. by 50% by 2027, relative to a 2022 baseline, to at least 30% women and 30% URP. These ambitious goals demonstrate our commitment to having a diverse group of company leaders.
To achieve these goals, we focused on enhancing ourpopulations, hiring, promotion, and retention practices. With respect to hiring, we expanded our existing senior-level hiring practices to a larger group of positions. These practices include broader recruiting efforts, diverse interview panels and candidate slates, standardized interview questions and hiring-manager training. With respect to promotions, we launched a new program in partnership with McKinsey to help diverseattrition rates all improved. While still higher than desired, the attrition rate for employees advance their leadership skills. We also continued to develop and improve our internal talent programs as discussed below. Through these efforts, we promoted 16% more womenfrom underrepresented populations decreased from 14% in 2022 thanto 9% in 2021. Indeed, increased promotions of women were the main reason the number of women in senior leadership globally increased by 1% to 22% in 2022.
While we are making significant efforts, our progress towards our goals in 2022 was negatively impacted by increased attrition of both women and URP leaders. Despite increased hiring and promotions of URP employees, the number of URP senior leaders in the U.S. decreased by 1% from 19% in 2021 to 18% in 2022. We continue to analyze retention issues to understand attrition drivers and to enhance our employee engagement efforts. Other factors impacting our results were the challenging external talent market and2023. This, coupled with the addition of new senior leadership roles duein the U.S., resulted in flat overall representation when compared to 2022. Despite this, we still experienced a net gain in the Company’s growth initiatives. We recognizenumber of employees from underrepresented populations resulting from a 21% increase in senior leadership headcount.
Our efforts to improve equity are focused on ensuring that building talent pipelinesour systems and transformingprocess are fair to all employees. This also requires us to ensure we are communicating transparently with our employees. Our goal is for 100% of employees to believe they are being treated fairly. Similar to our GoalZERO safety culture, takes time,our approach to equity focuses on continuous improvement and striving for excellence. To measure our progress, we remain committed to frequently assessing outcomes and developing programsconduct annual engagement surveys with our employees. Our most recent survey in 2023 indicates that will advance these goals.83% of employees who responded feel they are being treated fairly.
Equity
For the secondthird consecutive year, the CompanyLYB completed a pay equity review and performance analysis. Our pay equity review compared pay for like jobs and specifically focused on base pay for gender (globally) and ethnicity (U.S. only). Consistent with 20212022 findings, the review reflected that pay is generally administered fairly, with a small number of exceptions that should be remediated by the second quarter of 2023. We also confirmed that performance appraisals are generally administered fairly. Both of these annual review processes are now embedded in our HR processes.
The Company
In 2023, we also implemented several practices to advance pay equity, including:
| • | Establishing an Equity Committee to ensure key People and Culture policies are developed and audited annually; |
| • | Conducting a DEI review of our benefits, which resulted in greater coverage of employees’ dependents, ongoing global plan harmonization, and enhanced mental health support; and |
| • | Expanding our employee recognition program, Bravo!, to 33 countries and offering enhanced features to promote collaboration and the celebration of holidays globally. |
Promoting a culture of inclusion is critical. Like our equity goal, we strive to have 100% of our employees feel they are included and belong. Our most recent engagement survey in 2023 indicates that 80% of respondents feel like they belong at the Company. To drive change, we focus our inclusion efforts on key initiatives that include learning and education, outreach, and employee networks.
| 2024Proxy Statement | LyondellBasell | 25 |
Ensuring that job offers are based on the role, market competitiveness, and a candidate's level of proficiency and experience and not based on a candidate’s historical compensation;
Modifying promotion practices to ensure pay fairness is applied consistently for internal candidates compared to external hires;
Helping line managers conduct an internal equity review for their employees and, when necessary, making compensation adjustments; and
Establishing a consistent framework for recognizing and retaining employees.
Finally, we conducted stakeholder workshops to strengthen our approach to pay equity and provide increased transparency to employees about pay practices.
Inclusion
We advanced our inclusion efforts by increasing the numberwith our six global networks, which are composed of global employee networks from four to six, building a global diverse networkgroups of employees championing inclusion. The new networks, Global Asian/Pacific Islander and Global Latin, were chosen based on employee input and opportunities to improve inclusion within our workforce. Executive leaders serve as active sponsors for each network, and about 15% ofIn 2023, we achieved 18% participation in our global workforce has joined at least one of our employee networks. We have network members present at 92% of our global sites, with 47% of members residing outside of the U.S. and 28% joining as allies of underrepresented groups.networks, which is a 20% increase relative to 2022. Network programming is strongly tied to career development and business and community impact, includingimpact. Our engagement survey indicates that participants in strategy development activitiesour employee networks are 20% more engaged than employees who are not members of a network. Additionally, participants in employee networks are 10% more likely to report satisfaction with executives in 2022.the Company’s future than employees who are not members of a network.
Our company has prioritized and implemented DEI training continues to play an important roleaccelerate change in aligning our culture to our values.workforce at all levels. In 2022, 32% of employees (6,235) completed 17,419 DEI-related trainings. We assigned at least one mandatory training session to 1,320 people leaders, and another 4,915 employees completed these DEI courses voluntarily. We are2023, development was primarily focused on track for our manufacturing front lineworkforce and People and Culture professionals. We engaged 7,145 manufacturing employees with DEI training through guided topics and learning materials led by supervisors and leadership at the site level. These leader-led discussions were completed at 86 sites globally and in local languages. For our People and Culture employees, we focused on DEI upskilling and building capability to better address and champion DEI in day-to-day activities and interactions with leaders. Through regional training sessions, we trained 288 People and Culture employees in 2023. We believe our People and Culture community is in a unique position to further embed DEI into everything we do.
LYB is committed to creating continuous learning environments, providing ongoing development, growing capabilities, and unlocking potential for all employees to complete required DEI trainingperform at their best. Our value, We Champion People, is underscored by the end of 2023. Basedour focus on our 2022 employee engagement survey results, the gap in satisfaction in between our URP employees and non-URP employees has narrowed since 2020, with significant improvement among our Black employees.
LYONDELLBASELL 2023 PROXY STATEMENT 22
Supporting employee growth and development remainsin an inclusive environment. We develop our employees through a key focusbalance of experience on the job, learning from others, and formal learning.
In 2023, we expanded our LYBUniversity to include additional formal learning and development resources to empower our employees to grow their capabilities. To build skills and capabilities necessary for leaders to guide their teams through our culture transformation, we offered multiple learning opportunities. Through different learning workshops focusing on culture and change, we engaged with more than 2,000 leaders and provided resources to support the Company. In 2022, we launched a newconversations and transformation with their teams. Our e-learning platform that provides learning opportunities forempowers employees globally. 31%to drive their own development through on-demand learning. More than 35% of our workforce is enrolled in the programplatform, and hasparticipants have completed more than 10,000200,000 training hours aimed at increasingbuilding and enhancing business, technology and personal development skills. We also launched LyondellBasell University,have a platform which providesleadership development framework that offers programs with structured learning and development resourcespaths tailored to help employees advance their capabilities and unlock their potential. In addition, our Engineer U program also provides in-person and virtual classes to our global engineering workforce, and our Young Engineer Program in Europe provides our talented engineers with rotational and developmental opportunities. In 2022, four new engineers were onboarded into the Young Engineer Program, and 19 young engineers attended an internal learning forum.
Leadership training was provided toequip leaders at various levelsdifferent stages with the necessary skills to excel in their current role and prepare them for future challenges.
On-the-job development is key to building the Company, including 262 first-time leaders who participated in a programknowledge and skills to help them transition effectively into leading others, 116 middle managers who participated in an interactive 3-month classroom programdeliver our strategy. Through internal job postings, we provide transparency and opportunity for our employees to advancedrive their coaching skills,development and 96 senior leaders who completed an intense 5-day university program to equip them to lead our business initiatives.
To prepare our leaders for advancement to larger roles,career growth. Additionally, we tripled participation in our executive mentoring and peer learning programs. In addition, we expandedheld quarterly talent reviews across businesses and regions to lower management levelsnot only identify our potential future leaders but also to drive more internal promotions and help leaders improve how they attract, develop and retain employees.identify development opportunities. As a result of this focused approach, about 83%70% of our openings in senior leader roles were filled by internal talent, underscoring our commitment to advancinggrowing talent from within the Company. Finally, we launched new reward programs
LYB is committed to recognizeadvancing our people by helping them develop achievable goals that promote personal and retain key employees.
In 2022, significant effort was madeprofessional growth, providing continual on-going effective feedback to survey employees and apply these insights to continuously improvecreate a culture of ownership for our work environment. Nearly 13,000 employees completed our engagement survey in June 2022. To collect more detailed feedback, 399 employees across 21 sites globally participated in confidential interviews. Overall, our employee engagement score was high, with 83% of employees responding favorably. Compared to the last survey in 2020, our scores related to sustainability, DEI, compensation, learning and performance management programs improved, and we did not see significant declines in any area. Senior management reviewed these results, which are used to continually improve talent development, employee advancement, DEI and workplace flexibility programs.
LYONDELLBASELL 2023 PROXY STATEMENT 23
LyondellBasell is taking action to help tackle the global challenges of eliminating plastic waste, addressing climate change,success, and supporting a thriving society. culture of recognition and accountability. Our performance management process includes ongoing feedback and a formal year-end performance assessment. This year, we introduced an Equity Champion role into the year-end performance management process to listen for equitable discussions on performance. We also implemented tools and steps for reviewing equity throughout the year-end performance management process. We are committed to auditing these key programs annually to ensure that they are operating as intended.
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As one of the world’s largest producers of plastics and chemicals, we have the potential — and responsibility—strive to use our scale and reach to make a positive impact across value chains. We areon our planet and society. LYB is working to deliver meaningful progress to address somehelp tackle the global challenges of the world’s most pressing challenges such as helping endeliminating plastic waste in the environment, mitigatingtaking climate changeaction, and contributing tosupporting a thriving society forsociety. Our sustainability goals are key to achieving our employees, the communities where we operate and the people who depend on our products.new long-term business strategy.
| (1) | Production and marketing includes (i) joint venture production marketed by LYB plus our pro rata share of the remaining production produced and marketed by the joint venture, and (ii) production via third-party tolling arrangements. |
In addition
We continue to defining our longer-term sustainability priorities, we are takingtake substantive action to achieve thoseour sustainability and climate goals. Our commitment to sustainability and our progress in executing our new strategy have been recognized by organizations that assess and rate ESG performance. MSCI upgraded our ESG rating to “leader” with a score of “AA,” and LYB received an “A-” in the latest CDP Climate Change disclosure, placing us in a leadership position for climate action. Noteworthy initiatives and accomplishments during 20222023 are highlighted below, as well as in the Company’s annual Sustainability Report, available on our website at www.LyondellBasell.com by clicking on “Sustainability,” then “Reporting.” Our Sustainability Report also includes our sustainability disclosures under the Global Reporting Initiative (“GRI”), the Sustainability Accounting Standards Board (“SASB”), and the Task Force for Climate-Related Financial Disclosures (“TCFD”). For more information about how our sustainability actions and milestones impact executive compensation, see the section titled “2022“2023 Executive Compensation Decisions in Detail—20222023 Annual Bonus Payments—Sustainability” on page 53.
| 2024Proxy Statement | LyondellBasell | 27 |
LYONDELLBASELL 2023 PROXY STATEMENT 24
In December 2022,housing, food packaging and more. The challenge we stepped upface is the mismanagement of plastic waste. This is why we are accelerating our ambitions to reduce greenhouse gas (GHG) emissions from global operations, increasing our 2030goal for scope 1 and scope 2 reductions from 30% to 42%, relative to 2020. We also announced a new 2030 goal to reduce scope 3 emissions by 30%, relative to 2020 and in accordance with guidelines from the Science Based Targets Initiative. We remain committed to procuring at least 50% of our electricity from renewable sources by 2030. These targets are consistent with efforts to supportinnovate, scale, and deliver solutions to turn post-use plastics into everyday products and reduce plastic waste in the Paris Agreement’s goal of limiting climate change by achieving net zero for global GHG emissions by mid-century.environment.
As of March 2023, LyondellBasell has signed 13 renewable electricity PPAs, which will reduce our scope 2 emissions by more than 1 million metric tons of GHG emissions. Through these agreements, we have achieved 70% of our target to procure at least half of our global electricity from renewable sources by 2030.
In the near to medium term, we continue to execute our previously announced initiatives to reduce emissions, including:
Phasing out use of coal at our Wesseling, Germany site, reducing scope 2 emissions by about 170 thousand metric tons annually; and
Closing our Houston refinery, anticipated by the end of December 2023, further reducing scope 1 and scope 2 GHG emissions by more than 3 million metric tons annually and scope 3 emissions by approximately 40 million metric tons annually.
In the long term, our pathway to achieve net zero includes enhanced energy management; low emission steam; flare minimization; use of lower-emitting fuels; process electrification; furnace upgrades; and carbon capture, storage, and utilization. We continue to engage with our shareholders and other stakeholders to understand their priorities, concerns, and insights regarding our climate strategy and goals.
In 2022, we launched our new Circular and Low Carbon Solutions (CLCS) business to support our ambition to produce and market at least two million metric tons of recycled and renewable-based polymers annually by 2030. We continue to invest in our suite of(1) Our Circulen portfolio of products which support the reduction of plastic waste in the environment through the use of recycled content, and renewable materials as a feedstock. These products are produced using raw materials derived from mechanical recycling (CirculenRecover), advanced recycling (CirculenRevive), or renewable materials (CirculenRenew).As global demand for recycled and renewable-based plastics continues to grow, we are making investments in our CLCS business to secure feedstock supply, expand our recycling footprint, and develop scalable technologies to grow our Circulen family of recycled and renewable-based polymers.
In 2023, the CLCS business made significant progress investing upstream to secure plastic waste material to deliver on this recycling ambition. The investments we make under our CLCS business are focused on growing salessecuring feedstock supply, expanding our recycling footprint and developing scalable technologies to grow our Circulen portfolio ofCirculen products globally and across our business segments. Our Circulen products support the reduction of plastic waste in the environment through the use of recycled content as a material feedstock.
In furtherance of this goal, we announced plans to formformed joint ventures to build and operate plastics recycling plantsinfrastructure in ChinaEurope, Asia, and India, expected to come online in 2023 and 2024, respectively.North America. The recycled products produced by these joint ventures will be marketed through our Circulen Recover and Circulen Reviveproduct portfolio to help meet increasing global demand for sustainable solutions. We also formed a joint venture, Source One Plastics,In November 2023, we made the final investment decision to build an energy efficient, advanced plastic waste sorting and recycling facility in Germany. The Source One Plastics facility will provide feedstock to our newLYB’s first commercial catalytic advanced recycling plant inat our Wesseling, Germany whichsite. LYB will use its proprietary MoReTec technology to convert pre-treatedpost-consumer plastic waste into feedstock for delivery of new plastic production using our proprietary MoReTec technology.materials. In addition, we are exploringentered a collaboration with Cyclyx International and ExxonMobiltwo other companies to advance development of a first-of-its-kind plastic waste sorting and processing facility in the Houston, Texas area. The new facility would address a critical missing link in the plastic waste supply chain by connecting community recycling programs to new and more advanced recycling technologies that have the potential to takeaccept a much wider variety of plastic materials.
We are committed to reducing greenhouse gas (GHG) emissions from our global operations and value chain, and delivering solutions that advance our customers’ climate ambitions. Carbon is the atom of life, and carbon molecules will continue to play a critical role in our industry. They are a key component of the products we make, so we are increasing our use of circular and sustainable sources of carbon while creating solutions to help enable the transition to a low carbon future. In 2023, we introduced a new product range, +LC (Low Carbon) solutions, manufactured using the International Sustainability and Carbon Certification PLUS (ISCC+) mass balance methodology. +LC products include core offerings from our intermediates and derivatives segment, from styrene monomers to propylene oxide (PO), with applications in various sectors, including insulation materials, automotive and consumer goods.
Within our global operations, we have set industry-leading, ambitious targets to reduce our GHG emissions and have taken concrete steps to achieve our goals. In the last two years, we accelerated our interim targets for 2030 by increasing or scope 1 and 2 GHG emissions reduction goals to 42% and establishing a scope 3 emissions reduction target of 30%, relative to a 2020 baseline.
Our ambition to reach net zero scope 1 and 2 emissions from global operations by 2050 is focused on four levers: energy efficiency; renewables and electrification; hydrogen and other technologies; and carbon capture, use and storage. This strategy encompasses our plans for organic growth, divestitures and previously announced asset closures, including the cessation of our Houston refining operations by no later than the first quarter of 2025.
| (1) | Production and marketing includes (i) joint venture production marketed by LYB plus our pro rata share of the remaining production produced and marketed by the joint venture, and (ii) production via third-party tolling arrangements. |
| 2024Proxy Statement | LyondellBasell | 28 |
In 2023, we increased the use of renewable and low carbon energy primarily through power purchase agreements (PPAs). As of December 31, 2023, we have already completed enough PPAs globally to secure nearly 90% of our target to procure at least 50% of electricity from renewable sources by 2030, bringing our total procured renewable electricity to 1,385 megawatts. In addition, we are continuingexploring the potential to explore additional joint venturedesign, build, and operate a pilot electric steam cracking furnace in the United States. In 2023, we also established our inaugural green financing framework, which reflects the decisive steps we are taking to allocate capital toward initiatives aligned with our approach to sustainability, and issued $500 million in green bonds, the net proceeds of which will be allocated toward eligible green projects.
We recognize the vital role we play in maintaining and enhancing the health and prosperity of our planet. We aim to cultivate our planet by unlocking opportunities to protect precious resources, from resource recovery to water efficiencies, and collaborative endeavors.
LyondellBasell has been awardedmitigating the destruction of critical ecosystems. In 2023, we made significant progress in the development of our environmental strategy, establishing a Gold Medalclear action plan to execute in the years ahead. We also endorsed the United Nations CEO Water Mandate, committing to adopting and implementing a comprehensive approach to water management. Work in 2023 included evaluating ways to improve our water governance, and assessing our water-related opportunities, risks, management approaches and documentation. This work provides the foundation for our 2022 Sustainability Rating from EcoVadis,planned site-specific evaluations at our large sites and those located in high water stress regions.
We are working to achieve a thriving society where every individual has the opportunity to reach their full potential. We actively contribute to a thriving society through our relentless pursuit of safety, operational excellence, and a diverse, inclusive and equitable workforce. We partner with the communities where we operate to make positive impacts, and are committed to giving back by partnering with local organizations on initiatives to address critical needs. In 2023, our people volunteered more than 21,000 hours across our sites. LYB donated more than $14 million to community investments, including financial and in-kind donations and the total value of employee volunteer hours.
LYB is committed to conducting business in an ethical and responsible manner. Our Code of Conduct embodies our dedication to conducting business ethically and responsibly and our Human Rights Policy sets forth our commitment to upholding human rights throughout our global provideroperations. We have adopted a Global Procurement Policy that outlines a framework of corporate social responsibilityprinciples and requirements to ensure compliance with our Human Rights Policy, and have incorporated in our standard contracts and purchase order terms and conditions a Supplier Code of Conduct. We evaluate our suppliers’ compliance through risk assessments, ratings, audits, and sustainability assessments. This award places usIn 2023, we formed our Global Sustainable Procurement program to accelerate improvement in our supply chain and completed a supplier sustainability risk mapping project using the EcoVadis IQ platform to gain a detailed view of the risks in the top nine percentareas of companies globally inenvironment, social standards, and ethical risk. We surpassed our industryinitial target of 700 supplier assessments, achieving over 1500 rated by EcoVadis for their overall sustainability performance. As part ofsuppliers. In addition, we launched our sustainable procurement program in 2022, we engaged EcoVadis to assess the sustainability performance of almost 700 LYB suppliers, driving a 10-point improvement in the Sustainable Procurement pillar of our Sustainability Rating. We also updated our Supplier Code of Conduct and sustainability clauses in our Purchasing General Terms & Conditions to enhance ESG practices throughout our supply chain.
We are a member of Together for Sustainability (TfS), a(“TfS”) audit program in 2023. We foster relationships across our entire value chain to create better outcomes, successfully address global network of chemical companies focusedchallenges, and amplify our impact on assessing, auditingsociety and improving sustainability practices within their global supply chains. In 2022, we collaborated with other industry leaders to develop a global standard for product carbon footprint (PCF) calculation, which will allow chemical companies to calculate scope 3 greenhouse gas emissions across their supply chains and track performance against TfS's PCF guideline. We are also part of a TfS pilot program to implement a standard PCF data collection and sharing platform.the planet.
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LYONDELLBASELL 2023 PROXY STATEMENT 25
While the Company’s CEO is responsible for assessing and managing the Company’s day-to-day risks and related control systems, the Board has broad oversight of the Company’s risk profile and risk management. In this oversight role, the Board is responsible for satisfying itself that the risk management processes designed and implemented by management are functioning and that necessary steps are taken to foster a culture of risk-adjusted decision-making throughout the organization. These processes and structures include the Company’s Enterprise Risk Management (ERM) organization, Code of Conduct and related compliance program, internal controls function and disclosure committee meetings and controls, and a robust internal audit function. The Company believes that this division of responsibilities achieves sound risk management and that the Board’s involvement ensures effective oversight.
The primary means by which our Board oversees the Company’s short-, intermediate-, and long-term risks is through regular communication with management. At each Board meeting, members of management are asked to report to the Board and, when appropriate, specific committees. These presentations provide members of the Board with direct communication with management and the information necessary for a full understanding of the Company’s risk profile, including information regarding the Company’s specific risk environment, climate scenarios, exposures potentially affecting our operations, and the Company’s plans to address such risks. In addition to providing general updates on the Company’s operational and financial condition, members of management report to the Board about the Company’s outlook, forecasts, and any impediments to meeting them or to successfully pursuing the Company’s strategies more generally. In carrying out its oversight responsibility, the Board has delegated to individual Board committees certain elements of its oversight function, as described in the graphic below.
Our Board leads our commitment to sustainability and maintains oversight of the Company’s environmental, social and governance (“ESG”) profile. Management reports on key sustainability topics and initiatives at each regularly scheduled Board meeting, and directors participate in a deep dive on sustainability strategy and actions at least annually. During the Board’s annual strategy meeting in July 2022, the Board focused on the Company’s strategy, progress, and programs related to its goals on climate and the circular economy. The Board’s Committees provide guidance regarding specific ESG issues in accordance with their charters and responsibilities, as also described below.
| BOARD OF DIRECTORS |
| As part of its overall responsibility for governance and oversight of the Company, the Board has empowered its committees with oversight responsibility for the risks described below, which are tailored to each committee’s area of focus and set forth in its charter. Although each committee is responsible for evaluating and overseeing the management of certain risks, the entire Board is regularly informed of such risks through committee reports, presented at every regularly scheduled Board meeting, and through regular communication with management. The Board is responsible for ensuring that the risk management processes designed and implemented by management are functioning and for fostering a culture of risk-adjusted decision-making throughout the organization. |
 | ||||||||
| Audit Committee | C&TD Committee | Nom-Gov Committee | HSE&S Committee | Finance Committee | ||||
• Responsible for ensuring that an effective risk assessment process is in place, and reports are made by management to the Audit Committee in accordance with NYSE requirements. • Oversees enterprise-wide financial risks and reviews cybersecurity performance and risk • Oversees financial statements, independent accountants, internal audit function, related party transactions, internal controls; • Oversees compliance programs and EthicsPoint reporting helpline | • Responsible for the Company’s executive compensation programs, and evaluates risks in connection with such programs • Oversees talent management and related risks, including our DEI initiatives • Monitors talent development and responsible for management retention, recruitment, and succession planning | • Oversees the Company’s overall ESG profile and strategy • Reviews corporate governance practices and develops, reviews, and recommends corporate governance guidelines and policies • Responsible for director succession planning | • Reviews and monitors health and safety risks, programs, statistics and incidents (including major health, safety, environment, and security events) • Reviews and monitors environmental and sustainability risks, goals, trends and impacts, including climate initiatives and risk • Oversees sustainability reporting | • Oversees strategic transactions, including those that may impact our capital position • Reviews our tax strategy and planning • Reviews our capital structure, capital allocation, dividend policy, share repurchase programs, dept profile, and hedging strategies | ||||
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| MANAGEMENT |
| Senior leadership is responsible for assessing and managing the Company’s day-to-day risks and related control systems. Our CEO manages the Company’s risk profile through his Executive Committee, comprised of senior executives who lead our business segments and key functions. Our CEO and his Executive Committee meet regularly to identify, monitor, assess, mitigate, and report risks. The members of the Executive Committee play an important role in managing risks, and they include, among others: our Chief Financial Officer, who oversees our tax, treasury, internal audit, financial, M&A and strategic planning functions; our General Counsel, who oversees our Enterprise Risk Management organization and our procurement, compliance and legal functions; our Chief Innovation Officer, who oversees information technology, cybersecurity, and data privacy; our Executive Vice President, Sustainability and Corporate Affairs, who is responsible for our sustainability strategy and reporting; our Executive Vice President, People and Culture, who is responsible for talent management and DEI initiatives; and our Executive Vice President, Operational Excellence and HSE, who oversees health, safety, and environmental risks. Senior leadership is supported by the Company’s Enterprise Risk Management organization, composed of employees dedicated to deploying our enterprise wide risk management framework, and the standing Risk Management Committee, which is led by our CEO, CFO and General Counsel and reviews certain financial and strategic transactions for compliance with risk management policies and procedures. In addition, through a variety of policies and procedures, senior management is assisted by their respective leadership teams and organizations in identifying, monitoring, mitigating, and reporting risks and developing risk management plans aligned with the Company’s enterprise risk management framework. The results of the risk management processes and updates on material risks are reported to the Board and its committees on a regular basis. |
| 2024Proxy Statement | LyondellBasell | 30 |
|
| OVERSIGHT OF STRATEGY |
|
| Our Board is responsible for providing governance and oversight over the strategy, operations, and management of our Company. The primary means by which our Board oversees the Company’s short-, intermediate-, and long-term risks is through regular communication with management. At each Board meeting, members of management are asked to report to the Board and, when appropriate, specific committees. These presentations provide members of the Board with direct communication with management and the information necessary for a full understanding of the Company’s risk profile, including information regarding the Company’s strategy, specific risk environment, exposures potentially affecting our operations, and the Company’s plans to address such risks. In addition to providing general updates on the Company’s operational and financial condition, members of management report to the Board about the Company’s outlook, forecasts, and any impediments to meeting them or to successfully pursuing the Company’s strategy more generally. In 2023, management and the Board reviewed progress on the Company’s strategy at each of its regularly-scheduled meetings and discussed progress, challenges and lessons learned at its annual strategy meeting in July, including a deep dive review of the Value Enhancement Program. | |
| OVERSIGHT OF CYBERSECURITY | |
| We recognize the risk posed by global cybersecurity threats, and our Board is regularly updated on emerging risks and maintains oversight of the Company’s cybersecurity program implemented to address them. In 2023, management provided a detailed cybersecurity update to the Board and led discussions on specific cybersecurity and process control topics at its September meeting. The Audit Committee also reviewed updates to the Company’s cybersecurity dashboard, which summarizes key security metrics and activities, at each of its regularly-scheduled meetings and participated in a detailed discussion at its August meeting, including a discussion led by members of PricewaterhouseCoopers’ Cyber and Privacy Innovation Institute. The Company is not aware of any material incidents relating to the Company or third-party information systems security affecting the safety of our operations or ability to serve customers or significant breaches of personal information in the past three years. The Company had no fines from data protection authorities in the past three years and maintains a cybersecurity insurance policy. |
| OVERSIGHT OF ENVIRONMENTAL, SOCIAL, AND GOVERNANCE MATTERS | |||
Our Board Our Health, Safety, Environmental, and Sustainability (HSE&S) Committee oversees risks and opportunities related to safety, sustainability and climate change. Management reports on key sustainability and climate topics and initiatives at each regularly scheduled HSE&S Committee meeting, and the Board participates in a deep dive on sustainability strategy and actions at least annually. During the Board’s annual strategy meeting in July 2023, the Board reviewed the Company’s strategy, progress, and programs related to its goals on sustainability, climate and the circular economy, and the HSE&S Committee reviewed updates to the Company’s ESG dashboard, which summarizes key environmental, social and governance metrics and activities, at each of its regularly-scheduled meetings. Our Compensation and Talent Development (C&TD) Committee oversees our talent management practices, including compensation policies and practices, succession planning, and our DEI strategy, initiatives, and progress. The C&TD Committee monitors the Company’s compensation policies and practices to determine whether its risk management objectives are being met with respect to incentivizing its employees. The Company believes that its compensation arrangements do not encourage excessive risk taking and that its compensation programs and policies are not reasonably likely to have a material adverse effect on the Company. We recognize the importance of diversity at all levels of our organization, and DEI remained one of the four primary goal areas for our human resources department in 2023, and our EVP of People and Culture routinely updates the C&TD Committee on progress. In
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align with evolving U.S. and Dutch governance best practices and regulatory developments. In |
In response to cybersecurity concerns, the Company is developing solutions to mitigate the impact of third-party fraudulent cyber activity, including public facing portals for potential and current partners with capability to report suspected phishing.
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LYONDELLBASELL 2023 PROXY STATEMENT 26
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The Company has an
LYB’s Enterprise Risk Management (ERM) organization, with a group of employees dedicated to deploying the enterprise-wide risk management framework. The CEO andled by our General Counsel, areis responsible for overseeing these risk management programs, including assessing risk tolerances, evaluating whether such tolerances are aligned with the Company’s strategic goals, and defining our overall risk profile.profile and overseeing our risk management programs. Our ERM team aims to integrate a forward-thinking risk culture into every level of our organization by providing actionable risk management insights to leadership and equipping employees and management with tailored frameworks, tools, and processes to address significant threats and opportunities.
In 2023, our ERM function focused on four strategic priorities: (1) enterprise level risks, (2) departmental risks, (3) climate change risk management, and (4) building risk management capabilities.
Enterprise level risks are threats and opportunities that have the potential to impact LYB’s overarching objectives, operations, and reputation. Our CEO and the Executive Committee play a key role in identifying, reviewing, and managing enterprise level risks. Each year, our ERM team leads a risk workshop with the CEO and his Executive Committee and senior leaders to refresh the Company’sour enterprise risk profile. Together, the participants validate existing enterprise risks (both opportunities and threats), select new and emerging risks to add to the risk register, and ensure risk ownership is appropriately assigned toacross the appropriate executivesorganization. The updated enterprise risk profile is reviewed and approved by the Board and Board committees.
Examples of the Company’s enterprise risks include major health, safety, environment, and security events, cybersecurity, climate change, DEI, and global talent management.
The CEO has delegated to an internal Risk Management Committee the authority to review and approve certain transactions, including hedging strategies, that are in accordance with the Company’s approved risk management policies and procedures. The standing members of the Risk Management Committee include the CEO, the Chief Financial Officer, and the General Counsel. Under the Committee’s oversight, the Company’s Financial Risk Management Group manages foreign exchange, interest rate, and other financial risks across the Company’s global operations. Through a variety of policies and procedures, senior management and their leadership teams identify, monitor, mitigate, and report on risks and develop risk management plans aligned with the Company’s enterprise risk management framework.
The results of the risk management processes and updates on material risks are reported to the Board andannually at its committees on a regular basis. The Audit Committee is responsible for ensuring that an effective risk assessment process is in place, and reports are made to the Audit Committee in accordance with NYSE requirements.
During 2022, members of the Board were surveyed by the Company’s ERM organization regarding their assessment of the Company’s primary risks. In September 2022, the Board and ERM team reviewed the survey results together and identified and evaluated key enterprise risks, including feedstock advantages, safety incidents, cybersecurity and global talent development.
meeting. The direct line of communication between the Board, and members of management, facilitated at Board meetings and through these workshopsthe ERM function fosters a culture of accountability and collaboration throughout the organization, and allows the Board and its committees to further evaluate andbetter assess the management of the Company’s day-to-day risks.
LYONDELLBASELL 2023 PROXY STATEMENT 28
Departmental risks are specific to Contentsa particular business unit, project, or operational area within the organization, and are identified through surveys, workshops, and interviews facilitated by the ERM team. Workshops are conducted periodically to validate existing risks, identify new and emerging risks, and assign individual risk ownership. Common risks across multiple departments are elevated to the Executive Committee. This dual approach blends both top-down and bottom-up perspectives and cultivates a culture where risk considerations are intrinsic to decision-making processes.
Climate change risks include both physical risks stemming from the direct impact of climate change on the environment and our assets and operations, and transition risks and opportunities that arise from the global shift toward a lower carbon and more sustainable economy. Our Executive Vice President, Operational Excellence and HSE oversees climate-related risk exposures throughout LYB and our extended supply chain, supported by our Operational Excellence, Sustainability, and ERM organizations and cross-functional steering committees. We address specific climate-related risks through structured response plans, which are implemented through our Sustainability Council and NetZero Transition Steering Committee, with input and alignment from the Executive Committee and the HSE&S Committee of the Board. We utilize the Task Force on Climate-Related Financial Disclosures (TCFD) framework to guide our approach to reporting and disclosure, underscoring our commitment to transparency.
The ERM function spearheads various initiatives focused on cultivating skills, processes, and tools essential for robust risk identification, assessment, and mitigation across all organizational tiers. One such initiative is the Global Risk Champions Network, a diverse group of LYB employees who serve as a bridge between the ERM function and the broader business. Our Risk Champions facilitate cross-functional communication, integrate risk considerations across different business functions, and foster collaboration and a unified approach to risk management throughout LYB.
| 2024Proxy Statement | LyondellBasell | 32 |
This section provides board and committee membership information as of the date of this proxy statement. For more information about our 20232024 director nominees and committee membership following the 20232024 Annual General Meeting, including Ms. Griffin’sKarlin’s proposed committee appointments, see “Item 1 Election of Directors” on page 10.
The Board currently has sixfive standing committees, each consisting entirely of independent directors:
| • | Audit Committee |
| • | Compensation and Talent Development (“C&TD”) Committee |
| • | Nominating and Governance Committee |
| • | Health, Safety, Environmental, and Sustainability (“HSE&S”) Committee |
| • | Finance Committee |
Our Audit Committee
C&TD Committee
Nominating meets at least five times each year in alignment with our financial reporting and Governance Committee
HSE&S Committee
Finance Committee
Executive Committee
Ouraudit cycle, and our C&TD Committee, Nominating and Governance Committee, and HSE&S Committee each meet at least four times each year in connection with each regularly scheduled Board meetingmeetings (other than the Board’s strategy session held in July), and hold additional meetings as needed. Our Finance Committee meets as needed while other committees meet independently asto oversee the matters under their respective responsibilities require.it is responsible for. Committees regularly receive reports from LyondellBasellLYB management, report on committee actions to the Board, and may retain outside advisors.
In 2022,2023, the Board held six regularly scheduled meetings. Our directors’ average attendance rate at Board and committee meetings was 98%97%, and each of our current directors attended at least 90%93% of the total meetings of the Board and committees of which he or she was a member. Our Chair is a member of the Audit Committee, Nominating and Governance Committee Finance Committee and ExecutiveFinance Committee, and regularly attends meetings of the Audit Committee and the C&TD Committee. Although the Company does not maintain a policy regarding directors’ attendance at its general meetings of shareholders, both our Chair and CEO attend the Company’s annual general meeting each year and will attend the 20232024 annual general meeting (the “Annual Meeting”).
The table below provides membership and meeting information for each of the Board’s standing committees as of the date of this proxy statement. During 2022, the Board also formed a special committee to review our Company’s strategy with Mr. Vanacker, including the organizational and leadership changes implemented in October 2022. This committee was chaired by Mr. Aigrain and comprised five independent directors and Mr. Vanacker and met four times in 2022.
Name | Audit | Compensation & Talent Development | Nominating & Governance | HSE&S | Finance | Executive |
Jacques Aigrain |
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| |  |
Lincoln Benet |
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Jagjeet Bindra(1) | |
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Robin Buchanan |
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Tony Chase | | |
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Nance Dicciani(1) |
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Bob Dudley |
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Claire Farley | |
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Michael Hanley | | |
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Virginia Kamsky |
| |
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Albert Manifold |
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Peter Vanacker |
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2022 MEETINGS | 5 | 6 | 4 | 5 | 5 | 0(2) |
(1) Mr. Bindra and Ms. Dicciani have reached our mandatory retirement age and are not standing for re-election to the Board. (2) The Executive Committee meets on an as-needed basis to discuss coordination among the Board and its committees, collaborate on meeting agendas, and discuss ad-hoc issues. The Committee did not hold any meetings in 2022. | ||||||
LYONDELLBASELL 2023 PROXY STATEMENT 29
| Name | Audit | Compensation & Talent Development | Nominating & Governance | HSE&S | Finance |
| Jacques Aigrain |  | | | ||
| Lincoln Benet | |  | |||
| Robin Buchanan | | | |||
| Tony Chase | | | |||
| Bob Dudley | | | |||
| Claire Farley | | | |||
| Rita Griffin | | | |||
| Michael Hanley | | | |||
| Virginia Kamsky | | | |||
| Albert Manifold | | | |||
| Peter Vanacker | |||||
| 2023 MEETINGS | 5 | 4 | 4 | 5 | 3 |
| Chair | | Member |
Each of our committees has a written charter, approved by the Board. The charters can be found on our website at www.LyondellBasell.com by clicking on “Investors,” then “Corporate Governance,” then “Board of Directors.” Each committee annually reviews and recommends any changes to its charter and conducts an evaluation of committee performance with respect to delegated duties and responsibilities.
| 2024Proxy Statement | LyondellBasell | 33 |
|
Audit Committee | |||
*
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| 5 Meetings 83% Attendance | |
The Audit Committee is responsible for overseeing all matters relating to our financial statements and reporting, our internal audit function and independent auditors, and our compliance function. Listed below are the general responsibilities of the Audit Committee.
| • | Independent Auditor — Engage external auditor, review performance, and approve compensation; review independence and establish policies relating to the hiring of auditor employees; and pre-approve audit and non-audit services; | |
| • | Internal Audit — Review plans, staffing, and activities of the internal audit function and its effectiveness; | |
| • | Financial Statements — Review financial statements and earnings releases; discuss and review accounting policies and practices and external auditor reviews; and discuss and review the effectiveness of internal controls; | |
| • | Risk Management — Monitor the Company’s major financial and other risk exposures, including oversight of the Company’s policies and guidelines with respect to risk assessment and management, information technology and cybersecurity risks; and | |
| • | Compliance — Review plans, staffing, and activities of the compliance function and its effectiveness; establish and review procedures for complaints, including anonymous complaints regarding accounting, controls, and auditing; and review the Company’s Code of Conduct and system for monitoring compliance therewith. | |
Our Board has determined that all Audit Committee members are independent under the NYSE listing standards, our categorical independence standards, and the heightened independence requirements applicable to audit committee members under Securities and Exchange Commission (“SEC”) rules. Our Board has also determined that all Audit Committee members are financially literate in accordance with the NYSE listing standards and that Mr.Messrs. Hanley, Aigrain, and Mr. Chase qualify as audit committee financial experts under SEC rules.
Compensation and Talent Development (“C&TD”) | ||
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The C&TD Committee is responsible for overseeing our executive compensation, talent management and diversity, equity and inclusion (“DEI”) programs and developing the Company’s compensation philosophy.
In fulfilling its responsibility for the oversight of compensation matters, the C&TD Committee may delegate authority for day-to-day administration and interpretation of the Company’s compensation plans to Company employees, including responsibility for the selection of participants, determination of award levels within plan parameters, and approval of award documents. The C&TD Committee may not, however, delegate authority for matters affecting the compensation and benefits of the Company’s executive officers. The C&TD Committee’s responsibilities include the following:
In fulfilling its responsibility for the oversight of compensation matters, the C&TD Committee may delegate authority for day-to-day administration and interpretation of the Company’s compensation plans to Company employees, including responsibility for the selection of participants, determination of award levels within plan parameters, and approval of award documents. The C&TD Committee may not, however, delegate authority for matters affecting the compensation and benefits of the Company’s executive officers. The C&TD Committee’s responsibilities include the following:
| • | Executive Compensation — Approve the compensation and benefits of executive officers; review executive compensation practices to ensure consistency with corporate objectives; review and approve CEO goals and objectives and evaluate CEO performance; and make recommendations to the Board regarding CEO and other executive officer compensation; | |
| • | Company Compensation and Benefits — Review the Company’s compensation philosophy, programs, and practices; review and approve pension and benefit arrangements as well as funding of pension and benefit plans; review pay equity for the Company; and make recommendations to the Board on these subjects; and | |
| • | Talent Management — Review the Company’s organizational leadership structure and oversee leadership development, talent management, DEI initiatives, and succession and continuity planning for the CEO and other executive officers. | |
Our Board has determined that all C&TD Committee members are independent under the NYSE listing standards, our categorical independence standards, and other independence requirements applicable to compensation committee members under NYSE rules.
Compensation Committee Interlocks and Insider Participation — No member of the C&TD Committee serves or has served as an officer or employee of the Company or any of our subsidiaries and, during 2022,2023, no executive officer served on the compensation committee or board of any entity that employed any member of our C&TD Committee or Board.
For additional information on the C&TD Committee, including information regarding compensation consultants engaged during 2022,2023, seethe “Compensation Discussion and Analysis” beginning on page 43.46.
LYONDELLBASELL 2023 PROXY STATEMENT 30
| 2024Proxy Statement | LyondellBasell | 34 |
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| Chair:Claire Farley Members: Jacques Aigrain, Lincoln Benet, Robin Buchanan Independence:All Members | 4 Meetings 100% Attendance | ||
The Nominating and Governance Committee is primarily responsible for identifying nominees for election to the Board and overseeing matters regarding corporate governance.
To fulfill those duties, the Nominating and Governance Committee has the responsibilities summarized below:
To fulfill those duties, the Nominating and Governance Committee has the responsibilities summarized below:
| • | Directors and Director Nominees — Identify and recommend candidates for membership on the Board and recommend committee memberships; director recruitment and succession planning; | |
| • | Director Compensation — Evaluate and recommend director compensation;
| |
| • | Environmental, Social, and Corporate Governance Matters — Review the Company’s | |
| • | Administrative — Coordinate evaluations by committees and the full Board. | |
Health, Safety, Environmental and Sustainability (“HSE&S”) | ||
 | 5 Meetings 100% Attendance | |
The HSE&S Committee assists the Board in its oversight responsibilities by assessing the effectiveness of health, safety, environmental, and sustainability programs and initiatives that support Company policies.
The specific responsibilities of the HSE&S Committee are summarized below:
The specific responsibilities of the HSE&S Committee are summarized below:
| • | HSE — Review and monitor the Company’s health, safety, environmental and | |
| • | Sustainability — Provide oversight of the Company’s sustainability programs, initiatives, and activities; review with management relevant sustainability risks and trends; and monitor the Company’s progress on sustainability targets, ambitions, and reporting; and | |
| • | Audit — Review and approve the scope of the Company’s health, safety, and environmental audit program; regularly monitor audit program results; and review and approve the annual budget for the health, safety, and environmental audit program. |
Finance Committee | ||
| Chair:Lincoln Benet Members: Jacques Aigrain, Bob Dudley, Michael Hanley Independence:All Members | ||
100% Attendance | ||
| ||
The Finance Committee is responsible for monitoring and assessing such matters as the Company’s capital structure and allocation, strategic transactions, debt portfolio, and tax and derivative strategies.
In fulfilling its duties, the Finance Committee has the responsibilities summarized below:
In fulfilling its duties, the Finance Committee has the responsibilities summarized below:
| • | Strategy — Review analyses and provide guidance and advice regarding acquisitions and divestments and discuss and review the Company’s tax strategies, planning, and related structures; |
| • | Capital — Review the Company’s capital structure and capital allocation, including organic and inorganic investments; review and discuss the Company’s dividend policy; and review and discuss share repurchase activities and plans; and |
| • | Securities and Financing — Review and discuss the Company’s debt portfolio, credit facilities, compliance with financial covenants, commodity, interest rate, and currency derivative strategies, and proposed securities offerings. |
| 2024Proxy Statement | LyondellBasell | 35 |
LYONDELLBASELL 2023 PROXY STATEMENT 31
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Our Corporate Governance Guidelines and Rules for the Board of Directors provide that directors will not be re-nominated for election to the Board after they reach the age of 75. While the Board does not believe there is a specific age after which directors should no longer serve on boards, it does believe mandatory retirement ages are useful for promoting board refreshment; no waivers or exceptions to the rules have been granted and, since 2019, the Board has nominated four new directors to fill vacancies created by director retirements after reaching our mandatory retirement age.
The Board has not adopted term limits for its members. The Nominating and Governance Committee and the full Board regularly discuss board succession and refreshment and strive to maintain a balance of directors with varying lengths of service and ages. While the Board recognizes that term limits could assist in this regard, they may have the unintended consequence of causing the Board and the Company to lose the contribution of directors who over time have developed enhanced knowledge and valuable insight into the Company and its operations. The Board believes that the mandatory retirement age and an annual evaluation process for deciding whether to re-nominate individuals for election are currently more effective means of ensuring board refreshment and renewal, while also allowing for continuity of service.
In addition to a Code of Conduct for all employees and directors, the Company has a Financial Code of Ethics specifically for our CEO, CFO, CAO and persons performing similar functions. Our Code of Conduct covers a wide range of important topics including fair and accurate business dealings, corruption, health and safety, discrimination, and environmental protection. Copies of these codes can be found on our website at www.LyondellBasell.com by clicking on “Investors,” then “Corporate Governance.” Any waivers of the codes must be approved, in advance, by our Board, and any amendments to or waivers from the codes that apply to our executive officers and directors will be posted on the “Corporate Governance” section of our website.
We expect all employees to report possible violations or concerns regarding our Code of Conduct. We offer an independent whistleblower helpline and website, EthicsPoint, that enables employees and other stakeholders to report complaints anonymously. Our Chief Compliance Officer, who has a direct reporting line to the Audit Committee, provides regular reports to the Audit Committee on compliance with the Company’s Code of Conduct, related training programs, and complaints received and investigated by the compliance function.
We believe active participation in the political process is essential to our long-term success. LyondellBasell advances our public policy agenda through direct lobbying, involvement in various trade associations, and the LyondellBasell Political Action Committee (LYB PAC). Transparency and accountability are embedded into our public policy, political spending and lobbying actions. The Company maintains policies and procedures consistent with our Code of Conduct that support continued compliance with applicable political laws and regulations. Our engagement, including public policy advocacy directly and through trade associations, is subject to oversight by our senior management and CEO. In addition, the LYB PAC Board is responsible for the management of all LYB PAC activities, including the approval of all LYB PAC distributions.
LYONDELLBASELL 2023 PROXY STATEMENT 32
LyondellBasellLYB does not make direct political contributions to political parties or candidates using company resources (including monetary and in-kind services), even where permitted by law. All political contributions to political parties or candidates are made solely through the LYB PAC, which is funded and managed voluntarily by employees. All financial contributions strictly adhere to federal and state laws regarding contribution limits on amount and source, criteria and reporting requirements. We refrain from making political contributions in any country other than the United States. All political contributions are made without regard to the personal political affiliations or views of any individual employee at any level across the organization.
| 2024Proxy Statement | LyondellBasell | 36 |
Our advocacy activities are directed toward advancing LyondellBasellLYB’s business interests, to foster the protection and advancement of strong petrochemicalour operations and refining industries and not the personal political preferences of our executives or employees. LyondellBasell’sLYB’s strategy is grounded in safe and reliable operation of all assets. Contributions are based upon advancing our business goals in a broad range of public policies, including, but not limited to: promoting a stable and predictable regulatory framework for our operations; advancing circularity initiatives, including recycling programs, extended producer responsibility regimes, and advanced and chemical recycling; fair and equitable tax policies that promote economic investment, job creation and global competitiveness; improving energy efficiency and sustainability programs, policies and activities; advancing innovation and technology in manufacturing, recyclingmanufacturing; and infrastructure; improving work development programs to meet the needs of industry; andindustry. Our contributions are consistent with the Company’s public policies on sustainability, advancing a circular economy and addressing climate change. Moreover, LyondellBasellLYB policy prohibits directors and employees from using company resources for personal political causes or candidates, and specifies that LyondellBasellLYB will not directly or indirectly reimburse any personal political contributions or expenses.
LyondellBasell
LYB has an established practice to determine which public policy issues are important to the Company. This process includes soliciting input from relevant business and functional departments. Key issues are discussed and prioritized by members of senior management.
In all of the Company’s advocacy activities, we are committed to corporate responsibility, compliance and transparency. TheIn 2023, LYB published its first Climate Advocacy Report, which describes our approach to climate advocacy including detailing our climate policy positions, setting out our approach to participating in trade associations, and publishing our first-ever review and evaluation of trade association alignment with our climate policy positions. Our Climate Advocacy Report is available on our website at www.LyondellBasell.com by clicking “Sustainability,” then “Reporting.” In addition, the Company discloses its U.S. federal, state and local lobbying activity and expenditures as required by law. More information, including our statement of Principles for Public Policy for Sustainability, is available on our website at www.LyondellBasell.com by clicking “Sustainability,” then “Public Policy & Political Engagement.”
As a Dutch incorporated entity, we are subject to the Dutch Corporate Governance Code. The Code, most recently amended in 2022 and a copy of which can be found at www.mccg.nl/english, is a statement of principles and best practices for Dutch companies with an emphasis on integrity, transparency, and accountability as the primary means of achieving good governance. The Code’s compliance principle is “comply-or-explain,” which permits a Dutch company to comply with the best practices outlined in the Code or explain why the company has chosen to apply different practices.
The principles and practices prescribed by the Code are largely consistent with NYSE and SEC requirements and best practices for U.S. companies. In ourOur Dutch Annual Report, which accompanies our 20222023 Dutch Annual Accounts and can be found on our website at www.LyondellBasell.com by clicking “Investors,” then “Company Reports,” we disclosediscloses those instances where we have chosen to apply practices that differ from the Code. In general, these instances arise from our decision to apply practices that are more common or appropriate for NYSE traded companies than those called for by the Code. For example, although the Board’s categorical standards for director independence incorporate the standards of both the Code and the NYSE, our Board has chosen to apply the standards of the NYSE where the two conflict, including with respect to the independence classification of directors nominated by Access Industries, a greater than 10% shareholder. Our Board believes that application of the NYSE independence standards is more appropriate for LyondellBasell,LYB, which is listed only on the NYSE and not on any exchange in the Netherlands. Our Board further believes that the service of Access nominees on the Company’s key independent committees provides those committees with shareholder perspective and the significant skills, experience, and qualifications of these directors, to the benefit of the Board, the Company, and our stakeholders more generally.
We have adopted a written Related Party Transaction Approval Policy, which requires the disinterested members of the Audit Committee to review and approve certain transactions that we may enter into with related parties, including members of the Board, executive officers, and certain shareholders. The policy applies to any transaction:
in the ordinary course of business with an aggregate value of $25 million or more;
not in the ordinary course of business, regardless of value; or
with a value of $120,000 or more and in which an executive officer or non-executive director has a direct or indirect material interest.
Related party relationships are identified and disclosed on an ongoing basis, as well as through responses to annual questionnaires completed by all directors, director nominees, and executive officers.
LYONDELLBASELL 2023 PROXY STATEMENT 33
The Audit Committee reviews all the relevant facts of each related party transaction, including the nature of the related person’s interest in the transaction, and determines whether to approve the transaction by considering, among other factors, (i) whether the terms of the transaction are fair to the Company and on the same basis as those which could be obtained from non-related parties, (ii) the business reasons for the Company to enter into the transaction, (iii) whether the related party transaction would impair the independence of any independent Board member, and (iv) whether the transaction would present an improper conflict of interest for any director or executive officer of the Company. No director votes on approval or, unless requested by the Audit Committee, participates in the discussion of a related party transaction in which he or she has an interest. The Audit Committee also conducts an annual review of all transactions with related parties, including those that do not meet the thresholds for related party transactions described above.
The following is a description of related party transactions in existence since the beginning of fiscal year 2022.
In 2010, we entered into certain agreements with affiliates of Access Industries, including a registration rights agreement, which obligates us to register and bear the costs for the resale of equity securities owned by Access Industries or its affiliates, and a nomination agreement. Pursuant to the nomination agreement, Access Industries has the right to nominate individuals for appointment to the Board if certain ownership thresholds are met. Access Industries currently owns more than 18% of our outstanding shares and has nominated Mr. Benet, Mr. Buchanan, and Ms. Kamsky pursuant to the nomination agreement. The Company entered into these agreements with Access Industries before it became publicly traded and the Related Party Transaction Approval Policy was adopted. Amendments to the nomination agreement are approved by disinterested directors.
Calpine Corporation, the owner and operator of power plants across the United States and Canada, supplies power and steam to the Company’s Houston refinery and is owned by a group of investors, including a minority investment by Access Industries. The Audit Committee has approved, most recently in October 2020, the Company’s contracts with Calpine, which were determined to be on terms fair to the Company and more advantageous than those offered by other parties. In 2022, the Company purchased approximately $140 million of power, steam, and water from Calpine and sold approximately $37 million of excess gas and raw water to Calpine.
From time to time, the Company’s Advanced Polymer Solutions segment sells certain additives to Plasto-Cargal Group, a manufacturer of plastic container and film products, in which Access Industries holds an indirect minority investment. Sales are conducted in the ordinary course and no approval is required under the Company’s Related Party Transaction Approval Policy; however, the Audit Committee has reviewed and approved the continuation of such transactions, which totaled less than $0.5 million for 2022.
The Board was also made aware of, and considered the fairness of, certain transactions and relationships between the Company and other organizations where our directors and director nominees have relationships. These transactions and relationships were also considered in evaluating the independence of our directors and director nominees.
In particular, Messrs. Bindra, Buchanan and Chase and Ms. Dicciani and Ms. Kamsky each served as directors or advisors of companies with which LyondellBasell had commercial transactions in 2022. Each of these transactions was entered into on an arm’s-length basis in the ordinary course of business, and no director initiated or participated in negotiation of the relevant purchases or sales or had any material interest in, or received any compensation in connection with, these transactions. In each case, the payments made or received by LyondellBasell fell below the greater of $1 million or 2% of the other company’s annual gross revenue.
We indemnify members of our Board to the fullest extent permitted by law so they will be free from undue concern about personal liability in connection with their service to the Company. Our Articles of Association establish this indemnification right, and we have also entered into agreements with each of our directors contractually obligating us to indemnify them.
| 2024Proxy Statement | LyondellBasell | 37 |
LYONDELLBASELL 2023 PROXY STATEMENT 34
Our Nominating and Governance Committee reviews director compensation on an annual basis and recommends any changes in compensation determined advisable. The Board seeks to award compensation that fairly compensates directors for the work required by membership on our Board and aligns director interests with those of our shareholders. The Nominating and Governance Committee periodically receives advice from Pearl Meyer & Partners, LLC (“Pearl Meyer”), the Board’s independent compensation consultant, on director compensation practices and gives consideration to the qualifications and caliber of the Company’s directors and significant commitment required for service on our Board, including the additional time and effort required by overseas travel for many of our Board meetings.
Following its annual review in November 2023, the Nominating and Governance Committee recommended increasing the annual retainer for the Chair of the HSE&S Committee from $20,000 to $27,500, commensurate with the annual retainer for the Chairs of Audit Committee and C&TD Committee. No other changes to director compensation were recommended, and the Board approved the updated director compensation policy effective January 1, 2024. No other increases to board retainers have been approved since 2014, apart from an |
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Our non-executive directors receive cash compensation and equity compensation, in the form of restricted stock units (“RSUs”), for their service on the Board and its committees. Members of the Board have the option to elect to receive all or a portion of the cash component of their compensation in Company shares. Our CEO does not receive any additional compensation for his service as a director.
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| Board Retainer | Cash | RSUs |
| Chair of the Board | $325,000 | $325,000 |
| Members | $115,000 | $170,000 |
| Committee Retainers | Chairs | Members |
| Audit | $27,500 | $15,000 |
| Compensation & Talent Development | $27,500 | $10,000 |
| Nominating & Governance | $20,000 | $10,000 |
| Health, Safety, Environmental & Sustainability | $27,500 | $10,000 |
| Finance | $20,000 | $10,000 |
In addition to the retainers shown above, we provide members of the Board with a cash payment of $5,000 for each intercontinental trip taken in performing board service.
Members of our Board are subject to Share Ownership Guidelines. Under the Share Ownership Guidelines, non-executive directors are prohibited from selling any shares of the Company until they own shares that are valued at no less than six times their annual cash retainer for Board service, or $690,000 for all directors other than our Chair, whose ownership requirement is $1,950,000. Under the guidelines, only shares beneficially owned and RSUs (net of the anticipated tax obligation on vesting, estimated for these purposes at50%) count towards meeting the ownership thresholds. Once a director has reached his or her required ownership level, he or she may not sell shares that would bring ownership below the threshold level.
| 2024Proxy Statement | LyondellBasell | 38 |
Pursuant to our Policy Prohibiting Insider Trading, directors are prohibited from purchasing, selling, or writing options on the Company’s shares, engaging in short sales, participating in other derivative or short-term purchase or sale transactions, or otherwise engaging in transactions that would enable them to hedge against any decrease in our share price. Directors are also prohibited from pledging Company shares as collateral for personal loans or other obligations, including holding shares in a brokerage margin account. These restrictions extend to directors’ immediate family members and certain related entities and are intended to keep the interests of our directors aligned with the long-term interests of the Company and our shareholders.
| Name | Fees Earned or Paid in Cash ($)(2) | Stock Awards ($)(3) | All Other Compensation ($)(4) | Total ($) | ||||
| Jacques Aigrain | 346,849 | 320,182 | 12,691 | 679,722 | ||||
| Lincoln Benet | 145,000 | 167,474 | 5,000 | 317,474 | ||||
| Jagjeet Bindra(1) | 57,123 | — | 15,188 | 72,311 | ||||
| Robin Buchanan | 135,000 | 167,474 | — | 302,474 | ||||
| Tony Chase | 70,000 | 247,899 | 13,856 | 331,755 | ||||
| Nance Dicciani(1) | 20,890 | 42,626 | 10,188 | 73,704 | ||||
| Bob Dudley | 135,000 | 167,474 | 20,000 | 322,474 | ||||
| Claire Farley | 150,000 | 167,474 | 23,856 | 341,330 | ||||
| Rita Griffin(1) | 90,178 | 169,510 | 15,000 | 274,688 | ||||
| Michael Hanley | 152,500 | 167,474 | 24,600 | 344,574 | ||||
| Virginia Kamsky | 135,000 | 167,474 | 24,724 | 327,198 | ||||
| Albert Manifold | 141,041 | 167,474 | 5,000 | 313,515 |
| (1) | Mr. Bindra and Ms. Dicciani retired from the Board on May 19, 2023. Ms. Griffin was elected to the Board on May 19, 2023. |
| (2) | Includes retainers for services earned or paid through December 31, 2023. Mr. Chase and Ms. Dicciani elected to receive a portion of the cash component of their compensation in the form of shares of our common stock. |
| (3) | Represents annual grants of RSUs for all directors and shares of stock issued in lieu of cash compensation for Mr. Chase and Ms. Dicciani. |
| The annual grants of RSUs are made in conjunction with the Board’s regularly scheduled meeting in May of each year. The terms of the RSUs provide for vesting one year from the date of grant and for cash dividend equivalent payments when dividends are paid on the Company’s shares. In 2023, the annual grant for each continuing director, other than Mr. Aigrain and Ms. Griffin, was 1,860 units. Mr. Aigrain received 3,556 units, and Ms. Griffin received 1,865 units upon her election to the Board. These awards are the only stock awards outstanding at 2023 fiscal year-end for the non-executive directors. In accordance with FASB Topic ASC 718, Compensation — Stock Compensation (“ASC 718”), the grant date fair value of the awards is the number of units granted times the fair market value of our shares on that date. See Note 16 to the Consolidated Financial Statements included in our Form 10-K for the year ended December 31, 2023 for a description of accounting for equity-based compensation. | |
| The shares received in lieu of cash compensation are issued at the same time quarterly cash payments for retainers and travel fees are otherwise made. The number of shares issued is based on the average of the closing price of the Company’s shares over the quarter in which the compensation was earned. The shares issued in lieu of cash compensation in 2023 were as follows: Mr. Chase — 857 shares; Ms. Dicciani — 454 shares. | |
| (4) | Includes $5,000 for each intercontinental trip taken for work performed for the Company, other than Ms. Dicciani and Mr. Chase, who each elected to receive part of their travel fees in shares. Also includes benefits in kind related to tax preparation and advice related to the directors’ UK tax returns, payments and circumstances. The Company provides these services, through a third party, to members of our Board because of our unique incorporation and tax domicile situation. For Mr. Aigrain, also includes the approximate incremental cost to the Company for the personal use of Company aircraft by a family member travelling with Mr. Aigrain in 2023. Approximate incremental cost for travel on Company aircraft has been determined based on the total trip charge for each flight segment divided by the total number of passengers traveling on that segment. |
| 2024Proxy Statement | LyondellBasell | 39 |
LYONDELLBASELL 2023 PROXY STATEMENT 35
Name | Fees Earned or Paid in Cash ($)(3) | Stock Awards ($)(4) | All Other Compensation ($)(5) | Total ($) |
Jacques Aigrain | 345,945 | 334,166 | 15,000 | 695,111 |
Lincoln Benet | 145,397 | 174,832 | 5,000 | 325,229 |
Jagjeet Bindra(1) | 150,411 | 174,832 | 23,600 | 348,843 |
Robin Buchanan | 135,370 | 174,832 | — | 310,202 |
Tony Chase | 70,192 | 247,905 | 11,100 | 329,197 |
Stephen Cooper(2) | — | 52,823 | 3,600 | 56,423 |
Nance Dicciani(1) | — | 332,465 | 3,600 | 336,065 |
Bob Dudley | 135,370 | 174,832 | 20,000 | 330,202 |
Claire Farley | 150,151 | 174,832 | 18,600 | 343,583 |
Michael Hanley | 152,918 | 174,832 | 13,600 | 341,350 |
Virginia Kamsky | 40,500 | 227,640 | 7,500 | 275,640 |
Albert Manifold | 137,118 | 174,832 | 5,000 | 316,950 |
(1) Mr. Bindra and Ms. Dicciani have reached our mandatory retirement age and are not standing for re-election to the Board at the Annual Meeting. (2) Mr. Cooper retired from the Board on May 27, 2022. (3) Includes retainers for services earned or paid through December 31, 2022. Mr. Cooper and Ms. Dicciani each elected to receive all of the cash component of their 2022 compensation in the form of shares of our common stock. Mr. Chase and Ms. Kamsky each elected to receive 50% of the cash component of their 2022 compensation in the form of shares of our common stock. (4) Represents annual grants of RSUs for all directors (other than Mr. Cooper) and shares of stock issued in lieu of cash compensation for Mr. Chase, Mr. Cooper, Ms. Dicciani and Ms. Kamsky. The annual grants of RSUs are made in conjunction with the Board’s regularly scheduled meeting in May of each year. The terms of the RSUs provide for vesting one year from the date of grant and for cash dividend equivalent payments when dividends are paid on the Company’s shares. In 2022, the annual grant for each continuing director, other than Mr. Aigrain, was 1,568 units. Mr. Aigrain received 2,997 units, and Ms. Kamsky received 1,564 units upon her election to the Board. These awards are the only stock awards outstanding at 2022 fiscal year-end for the non-executive directors. In accordance with FASB Topic ASC 718, Compensation — Stock Compensation (“ASC 718”), the grant date fair value of the awards is the number of units granted times the fair market value of our shares on that date. See Note 15 to the Consolidated Financial Statements included in our Form 10-K for the year ended December 31, 2022 for a description of accounting for equity-based compensation. The shares received in lieu of cash compensation are issued at the same time quarterly cash payments for retainers and travel fees are otherwise made. The number of shares issued is based on the average of the closing price of the Company’s shares over the quarter in which the compensation was earned. The shares issued in lieu of cash compensation in 2022 were as follows: Mr. Chase — 853 shares; Mr. Cooper — 549 shares; Ms. Dicciani — 1,839 shares; Ms. Kamsky — 556 shares. (5) Includes $5,000 for each intercontinental trip taken for work performed for the Company, other than for Mr. Cooper and Ms. Dicciani, each of whom received shares as compensation for their travel fees, and Mr. Chase and Ms. Kamsky, who elected to receive part of their travel fees in shares. Also includes benefits in kind related to tax preparation and advice related to the directors’ UK tax returns, payments and circumstances. The Company provides these services, through a third party, to members of our Board because of our unique incorporation and tax domicile situation. | ||||
LYONDELLBASELL 2023 PROXY STATEMENT 36
 | The Board recommends that you vote FOR the discharge of our directors from liability for the performance of their duties in |
Under Dutch law, shareholders may discharge the Company’s Board of Directors from liability in connection with the exercise of duties during the most recently completed fiscal year. The discharge does not affect any potential liability under the laws of The Netherlands relating to liability upon bankruptcy and does not extend to matters that have not been disclosed to shareholders. It is proposed that shareholders resolve to discharge the Company’s executive and non-executive directors in office in 20222023 from liability in connection with the exercise of their respective duties during the year.
| The Board recommends that you vote FORthe adoption of our |
At the Annual Meeting, you will be asked to adopt our Dutch statutory annual accounts for the year ended December 31, 2022,2023, as required under Dutch law and our Articles of Association. Our Dutch statutory annual accounts are prepared in accordance with international financial reporting standards (“IFRS”) and Dutch law. A copy of the 20222023 Dutch statutory annual accounts can be accessed through our website at www.LyondellBasell.com by clicking “Investors,” then “Company Reports,” and may be obtained free of charge by request to our Corporate Secretary at CorporateSecretary@LyondellBasell.com or LyondellBasell Industries, 4th Floor, One Vine Street, London W1J 0AH, United Kingdom, Attention: Corporate Secretary..
The Company paid an aggregate of $9.96$5.00 per share in dividends from its 20222023 Dutch statutory annual accounts, for a total of approximately $3.3$1.6 billion. This includes interim dividends of $1.19$1.25 per share paid in each of the second, third and fourth quarters of 20222023 and the first quarter of 2023 and a special dividend2024.
Pursuant to the Dutch Corporate Governance Code, we provide shareholders with an opportunity to discuss our dividend policy and any major changes in that policy each year at our annual general meeting.
Our dividend policy continues to be to pay a consistent quarterly dividend, with the goal of increasing the dividend over time. Through March 31, 2023,2024, we have paid an aggregate of approximately $21.6$23.2 billion in dividends since we began our dividend program in 2011, increasing the dividend payments from $0.10 per share in the second quarter of 2011 to the current rate of $1.19$1.25 per share. 20222023 marked the Company’s twelfththirteenth consecutive year of regular dividend growth. The Company’s strong balance sheet and results of operations support the continuation of this quarterly dividend program. In addition, we paid a special dividend of $5.20 per share on June 13, 2022, returning approximately $1.7 billion to shareholders. The special dividend reflected the Company’s robust cash generation in 2021 and the first quarter of 2022 and our commitment to delivering capital returns to shareholders.
Pursuant to our Articles of Association, the Board has determined the amount, if any, out of our annual profits to be allocated to reserves prior to the payment of dividends. The portion of our annual profits that remains after the reservation is available for dividend payments as approved by shareholders. The determination to pay any dividends will be made after a review of the Company’s expected earnings, the economic environment, financial position, and prospects of the Company, and any other considerations deemed relevant by the Board.
| 2024Proxy Statement | LyondellBasell | 40 |
LYONDELLBASELL 2023 PROXY STATEMENT 37
| The Board recommends that you vote FOR the appointment of PricewaterhouseCoopers Accountants N.V. (“PwC N.V.”) as the auditor of our |
The Board has selected PwC N.V. to serve as the auditor of our Dutch statutory annual accounts to be prepared in accordance with IFRS for the year ending December 31, 2023,2024, and, in accordance with our Articles of Association, we are requesting that shareholders appoint PwC N.V. as auditor of such annual accounts. PwC N.V. has acted as the auditor of our Dutch statutory annual accounts since 2010. The Audit Committee also follows SEC rules and PwC policy regarding lead audit partner rotation. During 2021, a new lead audit partner was selected for the Company. Representatives of PwC N.V. will be present at the Annual Meeting either in person or by teleconference and may be questioned by shareholders in relation to PwC N.V.’s report on the fairness of the financial statements.
| The Board recommends that you vote FOR the ratification of PricewaterhouseCoopers LLP (“PwC”) as our independent registered public accounting firm for |
The Board has selected PwC to serve as our independent registered public accounting firm for the year ending December 31, 2023.2024. PwC has acted as our independent registered public accounting firm since 2010.
The Audit Committee, which annually recommends selection of the Company’s independent accountants, reviews PwC’s performance and independence on an ongoing basis and considers a number of factors in determining whether to re-engage PwC for the following year. The factors considered include, among others:
the quality of the audit conducted and service provided;
| • | the quality of the audit conducted and service provided; |
| • | the qualifications and performance of the lead audit partner; |
| • | the length of time PwC has served in the roles; and |
| • | the reasonableness of fees charged. |
the qualifications and performance of the lead audit partner;
the length of time PwC has served in the roles; and
the reasonableness of fees charged.
The Audit Committee also follows SEC rules and PwC policy regarding lead audit partner rotation. During 2021, a new lead audit partner was selected for the Company following meetings between the candidate and the Chair of the Audit Committee and Company management.
The Audit Committee believes the continued retention of PwC as the Company’s independent registered public accounting firm for 20232024 is in the best interest of the Company and its stakeholders.
| 2024Proxy Statement | LyondellBasell | 41 |
Although shareholder ratification of the selection of PwC is not required, our Board is submitting the selection to shareholders for ratification because we value our shareholders’ views on the Company’s auditors. If our shareholders fail to ratify the selection of PwC, it will be considered as notice to the Board and Audit Committee to consider the selection of a different firm. Even if the selection is ratified, the Audit Committee, in its discretion, may recommend that the Board select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interest of the Company and its stakeholders.
LYONDELLBASELL 2023 PROXY STATEMENT 38
Representatives of PwC are not expected to attend the Annual Meeting; however, representatives of PwC N.V., the auditor of the Company’s Dutch statutory annual accounts, will be present at the Annual Meeting and will have the opportunity to respond to appropriate shareholder questions and make a statement if they desire to do so.
Fees for professional services provided by PwC in each of the last two fiscal years, in each of the following categories, were as follows:
(in millions) |
| 2022 |
| 2021 |
Audit Fees | $ | 11.0 | $ | 10.7 |
Audit-Related Fees |
| 0.9 |
| 0.9 |
Tax Fees |
| 0.9 |
| 0.4 |
All Other Fees |
| — |
| — |
TOTAL | $ | 12.8 | $ | 12.0 |
| (in millions) | 2023 | 2022 | |||
| Audit Fees | $ | 12.1 | $ | 11.0 | |
| Audit-Related Fees | 2.3 | 0.9 | |||
| Tax Fees | 0.6 | 0.9 | |||
| All Other Fees | 2.6 | — | |||
| TOTAL | $ | 17.6 | $ | 12.8 |
Audit fees consist of the aggregate fees and expenses billed or expected to be billed for professional services rendered by PwC for the audit of our consolidated financial statements, the review of financial statements included in our Quarterly Reports on Form 10-Q, and services that are normally provided by an independent auditor in connection with statutory and regulatory filings or engagements, including comfort letters, statutory audits, attest services, and consents.
Audit-related fees consist of the aggregate fees billed for assurance and related services by PwC that are reasonably related to the performance of its audit or review of the Company’s financial statements and are not reported as audit fees herein. This category includes fees related to audits of benefit plans; agreed-upon or expanded audit procedures relating to accounting records required to respond to or comply with financial, accounting, or regulatory reporting requirements; and consultations as to the accounting or disclosure treatment of transactions or events and/or the actual or potential impact of final or proposed rules, standards, or interpretations by regulatory or standard-setting bodies.
Tax fees consist of international tax compliance and corporate tax consulting.
All other fees consist of fees paid for services provided by PwC that are not included in the audit, audit-related, and tax categories. Such services include licensing of technical accounting libraries and tools and other permissible advisory, consulting and outsourcing services.
The Audit Committee has adopted procedures for the approval of PwC’s services and related fees. Each year, the Audit Committee discusses the scope of the audit plan with PwC and all audit and audit-related services, tax services, and other services for the upcoming fiscal year are provided to the Audit Committee for pre-approval. The services, which may be provided in the upcoming twelve-month period, are grouped into significant categories substantially in the format shown above.
The Audit Committee is updated on the status of all PwC services and related fees on a periodic basis or more frequently as matters warrant. In 20222023 and 2021,2022, the Audit Committee pre-approved all audit, audit-related, tax and other services performed by PwC.
As set forth in the Audit Committee Report below, the Audit Committee has considered whether the provision of non-audit services by PwC is compatible with maintaining auditor independence and has determined in the affirmative with respect to the services provided in 2022.2023.
| 2024Proxy Statement | LyondellBasell | 42 |
LYONDELLBASELL 2023 PROXY STATEMENT 39
The role of the Audit Committee is, among other things, to oversee the Company’s financial reporting process on behalf of the Board, to recommend to the Board whether the Company’s financial statements should be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 20222023 (the “Annual Report”), and to select the Company’s independent auditor for ratification by shareholders. Company management is responsible for the Company’s financial statements as well as for its financial reporting process, accounting principles, and internal controls. The Company’s independent auditor is responsible for performing an audit of the Company’s financial statements and expressing an opinion as to the conformity of such financial statements with accounting principles generally accepted in the United States.
The Audit Committee has reviewed and discussed the Company’s audited financial statements as of and for the year ended December 31, 20222023 with management and PricewaterhouseCoopers LLP (“PwC”), the Company’s independent registered public accounting firm for the fiscal year ended December 31, 2022.2023. In addition, the Audit Committee has taken the following steps in making its recommendation that the Company’s financial statements be included in the Annual Report:
First, the Audit Committee discussed with PwC those matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (PCAOB) and the SEC, including information regarding the scope and results of the audit. These communications and discussions are intended to assist the Audit Committee in overseeing the financial reporting and disclosure process.
| • | First, the Audit Committee discussed with PwC those matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (PCAOB) and the SEC, including information regarding the scope and results of the audit. These communications and discussions are intended to assist the Audit Committee in overseeing the financial reporting and disclosure process. |
| • | Second, the Audit Committee discussed with PwC its independence and received from PwC the written disclosures and the letter required by applicable requirements of the PCAOB regarding PwC’s communications with the Audit Committee concerning independence. This discussion and disclosure helped the Audit Committee in evaluating such independence. The Audit Committee also considered whether, and concluded that, PwC’s provision of other non-audit services to the Company is compatible with the auditor’s independence. |
| • | Third, the Audit Committee met periodically with members of management, including the head of the Company’s internal audit and internal controls functions, and PwC to review and discuss internal control over financial reporting. Further, the Audit Committee reviewed and discussed management’s report on internal control over financial reporting as of December 31, 2023, as well as PwC’s report regarding the effectiveness of internal control over financial reporting. |
| • | Finally, the Audit Committee reviewed and discussed with the Company’s management and PwC the Company’s audited financial statements as of and for the year ended December 31, 2023, including the acceptability and appropriateness of the accounting principles applied, the reasonableness of significant judgments, and the clarity of the disclosure. |
Second, the Audit Committee discussed with PwC its independence and received from PwC the written disclosures and the letter required by applicable requirements of the PCAOB regarding PwC’s communications with the Audit Committee concerning independence. This discussion and disclosure helped the Audit Committee in evaluating such independence. The Audit Committee also considered whether, and concluded that, PwC’s provision of other non-audit services to the Company is compatible with the auditor’s independence.
Third, the Audit Committee met periodically with members of management, including the head of the Company’s internal audit and internal controls functions, and PwC to review and discuss internal control over financial reporting. Further, the Audit Committee reviewed and discussed management’s report on internal control over financial reporting as of December 31, 2022, as well as PwC’s report regarding the effectiveness of internal control over financial reporting.
Finally, the Audit Committee reviewed and discussed with the Company’s management and PwC the Company’s audited financial statements as of and for the year ended December 31, 2022, including the acceptability and appropriateness of the accounting principles applied, the reasonableness of significant judgments, and the clarity of the disclosure.
The Audit Committee also discussed with the head of the Company’s internal audit department and PwC the overall scope and plans of their respective audits. The Audit Committee meets periodically with both the head of the internal audit department and PwC, with and without management present, to discuss the results of their examinations and their respective evaluations of the Company’s internal control over financial reporting.
In the performance of their oversight function, the members of the Audit Committee necessarily relied upon the information, opinions, reports, and statements presented to them by Company management and by PwC as the Company’s independent registered public accounting firm.
Based on the reviews and discussions explained above (and without other independent verification), the Audit Committee recommended to the Board of Directors (and the Board of Directors approved) that the Company’s financial statements be included in the Annual Report. The Audit Committee has also approved the selection of PwC as the Company’s independent registered public accounting firm for fiscal year 2023.2024.
The Audit Committee
Michael Hanley, ChairJagjeet BindraJacques Aigrain
Tony Chase
Claire Farley
| 2024Proxy Statement | LyondellBasell | 43 |
LYONDELLBASELL 2023 PROXY STATEMENT 40
| The Board recommends that you vote FORthe approval, on an advisory basis, of the compensation of the Company’s Named Executive Officers as disclosed in this proxy statement. |
We believe that LyondellBasell’s executive compensation program supports our executive compensation philosophy and goals, drives performance, encourages an appropriate sensitivity to risk, and increases shareholder value. Our philosophy, which is set by the C&TD Committee, is intended to align each executive’s compensation with the Company’s short-term and long-term performance and to provide the compensation and incentives needed to attract, motivate, and retain high-caliber executives who are crucial to our long-term success.
A significant portion of the total compensation opportunity for each of our executives is directly tied to the Company’s progress against our strategic, operating, sustainability and operatingsafety goals.
We implement our philosophy and achieve our program goals by following certain key principles, including:
| • | positioning total direct compensation and each individual element of executive compensation near the median of our peer group companies, with consideration given to the relative complexity of comparable executive roles; |
| • | aligning short-term incentive awards with annual operating, financial, and strategic objectives, while taking into account the realities of a cyclical industry and rewarding differential performance rather than favorable or unfavorable market circumstances; and |
| • | rewarding absolute and relative performance over time through long-term equity incentive awards. |
aligning short-term incentive awards with annual operating, financial, and strategic objectives, while taking into account the realities of a cyclical industry and rewarding differential performance rather than favorable or unfavorable market circumstances; and
rewarding absolute and relative performance over time through long-term equity incentive awards.
Our executive compensation program received substantial shareholder support and was approved, on an advisory basis, by approximately 97%98% of votes cast at the 20222023 annual general meeting of shareholders. Our C&TD Committee and Board believe this level of approval of our executive compensation program demonstrates our shareholders’ strong support of our compensation philosophy and goals and the decisions made by the C&TD Committee. They also believe the consistently high level of shareholder support for our executive compensation is a result of our C&TD Committee’s commitment to compensating our executives in a manner that ensures a strong link between pay and performance and is reflective of our philosophy and goals, market best practices, and strong shareholder engagement.
The C&TD Committee believes that the compensation of our Named Executive Officers for 20222023 is reasonable, and appropriate, isand supported by the Company’s performance, andperformance. The C&TD Committee works to ensure management’s interests align with increasing shareholder value. The Board requests that you consider the structure of our executive compensation program in connection with our 20222023 performance, which is more fully discussed in the Compensation Discussion and Analysis (“CD&A”) section of this proxy statement that follows. The CD&A explains how we implement our compensation philosophy and goals and how we apply these principles to our compensation program. For additional information, see the section of this proxy statement titled “Pay Versus Performance” on page 74.80.
| 2024Proxy Statement | LyondellBasell | 44 |
LYONDELLBASELL 2023 PROXY STATEMENT 41
In accordance with Section 14A of the Securities Exchange Act of 1934, we are requesting that shareholders vote on an advisory basis to approve the compensation of our Named Executive Officers in 2022,2023, as described in this proxy statement. Shareholders have the opportunity to share their opinion regarding our executive compensation program by voting for or against the following resolution:
“RESOLVED, that the Company’s shareholders approve, on an advisory basis, the compensation of the Named Executive Officers as disclosed in the Company’s proxy statement for the 20232024 Annual General Meeting of Shareholders, including the Compensation Discussion and Analysis, the Summary Compensation Table and other related tables and disclosure.”
Although the advisory vote is non-binding, the Board values our shareholders’ opinions. The C&TD Committee will review the results of the vote and consider shareholders’ input when considering future decisions regarding our executive compensation programs. If you have concerns relating to our executive compensation programs, we encourage you to contact us. Aus because a vote against this proposal will not providethe C&TD Committee with information about shareholders’ specific concerns.
The Company provides for annual say-on-pay votes. This year, invotes, and the next say-on-pay vote will occur at our 2025 annual general meeting of shareholders. In accordance with SEC rules, shareholders will also be given an opportunity to express their views on whether the practice of annual say-on-pay votes should be maintained. For more information, see “Item 7. Advisory Vote on Frequency of Say-on-Pay Vote” on page 77. If our shareholders vote to continue the practice of annual say-on-pay votes, the next say-on-pay vote will occurmaintained at our 20242029 annual general meeting of shareholders.
LYONDELLBASELL 2023 PROXY STATEMENT 42
TABLE OF CONTENTS
| 2024Proxy Statement | LyondellBasell | 45 |
TABLE OF CONTENTS | |
| 47 | |
| 2023 Performance Highlights |
This section explains the decisions made concerning the compensation of the Company’s Named Executive Officers (“NEOs”) for fiscal year 2022.2023. It also describes the Company’s compensation philosophy, our executive compensation program, the process our C&TD Committee followed, and the factors the C&TD Committee considered in determining the amount of compensation awarded. Our NEOs for 20222023 are Peter Vanacker, the Company’s Chief Executive Officer since May 23, 2022; Ken Lane, the Company’s interim Chief Executive Officer from January 1, 2022 to May 22, 2022;Officer; Michael McMurray, the Company’s Chief Financial Officer; and the three other most highly compensated executive officers of the Company in 2022.2023. Their current titles are provided below.
 | 
| 
 | 
| 
 | 
|  |  | |
Peter Vanacker CEO | Michael McMurray EVP and Chief Financial | Ken Lane Former EVP – |
|
|
|
|
LYONDELLBASELL 2023 PROXY STATEMENT 43
| 
| 
| 
| |
|
SVP – Olefins & | Torkel Rhenman EVP – Advanced |
| (1) | Mr. Lane resigned from his position effective March 15, 2024. Ms. Kimberly Foley has succeeded Mr. Lane as our EVP, Global Olefins & Polyolefins, Refining and Supply Chain, and Mr. Aaron Ledet has been promoted to the role of EVP, Intermediates and Derivatives, effective March 1, 2024. |
| 2024Proxy Statement | LyondellBasell | 46 |
| $2.1 B | $5.2 B | $4.9 B | $1.8 B |
| Net Income | EBITDA ex. Identified | Cash from Operating Activities | Returned to Shareholders |
See Appendix A for information about our non-GAAP financial measures and a reconciliation of net income to EBITDA, including and excluding identified items. Identified items include adjustments for impairments and refinery exit costs.
In 2022,2023, the Company’s balanced business portfolio, excellentCompany delivered outstanding cash generation and robust balance sheet enabled us to navigateconversion amid challenging market conditions while continuing to provide significant returns for our shareholders.conditions. Despite volatility in energysoft global demand, capacity additions and feedstock prices and softer global demand,economic uncertainty, our businesses delivered $6.1$4.9 billion in cash from operating activities. We also continued our track record of delivering significant returns to shareholders, marking our thirteenth consecutive year of annual dividend growth and returning $3.7$1.8 billion to our shareholders through dividends and share repurchases,repurchases.
Implementing our new strategy. Last year, we launched our three-pillar strategy to create a more profitable and sustainable growth engine for LYB. Our strategy focuses on three initiatives: (1) Growing and upgrading the core; (2) Building a profitable CLCS business; and (3) Stepping up performance and culture.
One year after launch, we are making significant progress on each pillar. In March 2023, we successfully started up the world’s largest propylene oxide and tertiary butyl alcohol unit in Texas, which enables us to meet the growing demand for essential products. In addition, in early 2024 we entered into an agreement for a new propylene and polypropylene joint venture in Saudi Arabia. This year, we will continue to focus on efficiently growing and upgrading our core through decisive portfolio management, including the divestiture of our ethylene oxide and derivatives business. Following our final investment decision in 2023, we will also move forward on engineering and construction of our first advanced recycling plant using LYB’s proprietary MoReTec technology.
Throughout the year, we built strong foundations for our CLCS business by making significant investments to secure feedstock supply, expand our recycling footprint and develop scalable technologies to support the reduction of plastic waste in the environment through the use of recycled content as a $5.20 special dividend paidmaterial feedstock. We formed joint ventures to build plastics recycling infrastructure in June 2022. The special dividend, totaling $1.7 billion, reflected the Company’s record cash generation in 2021Europe, Asia, and North America. We also announced our decision to build the first quarteradvanced recycling plant using our proprietary MoReTec technology.
As we rapidly move forward on our new strategy, we are unlocking additional value by stepping up our performance and culture. One year after launching our Value Enhancement Program (VEP), we delivered a year-end run rate of 2022,more than $300 million of net income(2) and $400 million in recurring annual EBITDA(2), more than doubling our commitment to delivering capital returns to shareholders.original target for 2023.
ClimateProgressing on our climate and Circularity.sustainability goals. OurWe remain committed to our climate and sustainability strategygoals. In 2023, we built strong foundations for our CLCS business by forming partnerships to source and goals remain core to the ongoing successsort plastic waste while moving forward on our first tranche of advanced recycling capacity. We rapidly achieved nearly 90% of our Company. This past December, we stepped up our climate goals and increased our scope 1 and 2 reduction targets from 30% to 42%. In addition, we established a new goal to reduce scope 3 emissions by 30% by 2030. We also continue to strive towards our goal of procuring at least 50%procure half of our electricity from renewable sources and issued our goal of producing and marketing twoinaugural $500 million metric tons of recycled and renewable-based polymers annually by 2030. For 2022, 10% ofgreen bonds to help advance the payout under our annual executive bonus program is tied directly to the achievement of key milestones supporting ourCompany’s long-term sustainability goals: (1) execution of renewable electricity PPAs, (2) implementation of our CO2 reduction projects, (3) enhancement of our Circulen product sales, and (4)progression of our MoReTec technology.goals.
As of March 2023, LyondellBasell has signed 13 renewable electricity PPAs, which will reduce our scope 2 emissions by more than 1 million metric tons of GHG emissions. Through these agreements, we have achieved 70% of our target to procure at least half of our global electricity from renewable sources by 2030.
Safety. In 2022, our focus on safety was rewarded by2023, we continued to prioritize safety. We achieved a step change in safety performance. Compared to 2021, we reduced our total recordable incident rate (“TRIR”) by 43% to 0.12,of 0.139 and a record low for the Company, and we reduced our process safety incident rate (“PSIR”) by 24% to 0.026. 55of 0.035. Additionally, 60 of our manufacturing sites achieved GoalZERO (zero injuries, zero incidents and zero accidents), and 6667 manufacturing sites were injury-free.
Diversity, Equity & Inclusion. In 2022, we built on our 2021 DEI initiatives by adding two new global diverse employee networks to the existing four, launching a leadership program to support diverse employees, and requiring diverse interview panels and DEI training. We track our progress on our DEI goals and share updates with our Board and management regularly to increase visibility and improve outcomes. Through these efforts, we promoted 16% more women in 2022 than in 2021, and increased the number of women in senior leadership globally by 1% to 22%. As of February 2023, women comprise four of the ten members of our Executive Committee, who report directly to our CEO. Together, our CEO and Executive Committee represent six different nationalities.
We continue to work towards our goal of achieving gender parity (approximately 50% women and 50% men) in global senior leadership and increasing the number of underrepresented senior leaders in the U.S. to reflect the general population ratio by 2032, supported by an interim goal of increasing the number of female senior leaders globally and the number of underrepresented senior leaders in the U.S. by 50% by 2027, compared to a 2022 baseline, to at least 30% women and 30% URP. Our progress towards our goals in 2022 was negatively impacted by increased attrition of both women and URP leaders. Despite increased hiring and promotions of URP employees, the number of URP senior leaders in the U.S. decreased by 1% to 18%. We continue to analyze retention issues to understand attrition drivers and to enhance our employee engagement efforts. Other factors impacting our results were the challenging external talent market and the addition of new senior leadership roles due to the Company’s growth initiatives. We recognize that building talent pipelines and transforming culture takes time, and we remain committed to frequently assessing outcomes and developing programs that will advance these goals.
Pay for Performance. The Company paid 20222023 annual bonuses at 109%127% of target, in recognition of our EBITDAresilient results, continued cost discipline, outstandingrapid progress towards our Value Enhancement Program targets, strong safety performance and progress onachievement of key sustainability milestones. The annual bonus payouts would have been higher if not for the impact of challenging market conditions on EBITDA, which fell slightly short of targets for the year. There was 100%200% payout under the Company’s PSUs for the three-year performance period ended December 31, 20222023 reflecting the fact that the Company’s TSR matchedtotal shareholder return (“TSR”) fell in the median TSRtop quartile of selected peers.peers and the Company’s free cash flow (“FCF”) per share exceeded the target set by our C&TD Committee. The performance metrics under the Company’s annual bonus program and PSUs are further described under “2022“2023 Executive Compensation Decisions in Detail.” Our executives’ annual bonuses, including their individual performance ratings, will continue to reflect safety performance and support for our climate, circularity and DEI initiatives.
| (1) | See Appendix A for information about our non-GAAP financial measures and a reconciliation of net income to EBITDA, including and excluding identified items. Identified items include adjustments for impairments and refinery exit costs. |
| (2) | VEP goals are estimated based on 2017-2019 mid-cycle margins and modest inflation relative to a 2021 baseline. |
| 2024Proxy Statement | LyondellBasell | 47 |
LYONDELLBASELL 2023 PROXY STATEMENT 44
Our executive compensation practices support our pay for performance philosophy, align our executives’ interests with those of our shareholders, and reflect best governance without encouraging unnecessary risk-taking.
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Our executive compensation program has received substantial and consistent shareholder support over the past several years. At the 2021, 2022, and 2023 annual general meeting of shareholders, approximately 97%, 97%, and 98% of votes were cast in favor of our executive compensation program.program, respectively. Our C&TD Committee and Board believe that the consistent high level of support from our shareholders is a result of our commitment to ensuring that our executives are compensated in a manner that provides a strong link between pay and performance.
The C&TD Committee and Board value our shareholders’ insights and are committed to ongoing, regular dialogue with shareholders regarding executive compensation, among other matters. We consider shareholder feedback, evolving business needs, and our desire to maintain a strong link between executive pay and performance when evaluating our compensation program.
| Recent Shareholder Support for Say-on-Pay | ||
| 97% | 97% | 98% |
| 2021 | 2022 | 2023 |
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Our C&TD Committee is responsible for determining the compensation of our executive officers and designing our executive compensation program. The Committee, together with its independent compensation consultant, continually reviews compensation trends and best practices, discusses shareholder and employee feedback on the Company’s compensation programs, and considers the Company’s talent development goals and business needs. Since January 1, 2022,2023, the Committee and the Board of Directors took several noteworthy actions in relation to the Company’s compensation programs:
2022
 | For the 2023 STI program, the C&TD Committee replaced the fixed cost metric with a new value creation metric, which aligns executive compensation with the Company’s evolving strategy and vision. While thoughtful capital allocation remains an integral part of our culture, the 2023 incentive plan design emphasizes the Company’s increased focus on capturing value, improving agility and accelerating innovation. Payout under the value creation metric is determined by the achievement of incremental EBITDA targets supporting our goal of delivering up to $1 billion in recurring annual EBITDA improvement by the end of 2025. |
One year after launching our VEP, we have exceeded our original 2023 recurring annual EBITDA target of $150 million(1), and are on track to deliver on our goal of up to $1 billion of recurring annual EBITDA(1) improvement by the end of 2025. For a reconciliation of recurring annual EBITDA to the nearest GAAP financial measure, see Appendix A.
For 2022,2023, ESG metrics accountedcontinued to account for 30% of the total payout under the STI program (20% Safety and 10% Sustainability), reflecting the Company’s ongoing commitment to safety, accountability and timely delivery of our climate and circularity goals.
Safety. In 2023, we continued to prioritize safety. Our focus on safety was rewarded by a step change in our 2022 safety performance. Compared to 2021, we reduced our total recordable incident rate (“TRIR”) by 43% to 0.12,was 0.139, and we reduced our process safety incident rate (“PSIR”) by 24% to 0.026. 55was 0.035. 60 of our manufacturing sites achieved GoalZERO, and 6667 manufacturing sites were injury-free.
Sustainability. Under our sustainability metric, payout is based on the accomplishment of key milestones approved by the C&TD Committee. We believe that the sustainability metric ensuresincentivizes accountability and timely delivery of our climate and circularity goals. For 2022,2023, we focused on four milestones,three milestones: (1) execute Power Purchase Agreements with target (100%)cumulative volume from January 1, 2022 of 700 GW of renewable electricity capacity; (2) leverage transformation projects to improve energy efficiency by 1% from a 2021 baseline; and (3) produce and market 150kt of recycled and renewable-based polymers in 2023.(2) Target performance levels for each milestone are summarized below:under “—2023 Executive Compensation Decisions in Detail—2023 Annual Bonus Payments—Company Performance” on page 53.
For the 2023 STI PROGRAM (NEW VALUE CREATION METRIC)
For 2023,program, the C&TD Committee has approvedmodified the additionformula for calculating executive STI payments to eliminate the Corporate Score component of a new value creation metric, which will replace the existing fixed cost metric. Payout under the value creation metric will be determined by the achievement of incremental EBITDA targets supporting our previously announced goal of delivering $750 million in recurring annual EBITDA improvement by the end of 2025. For a reconciliation to the nearest GAAP financial measure, see Annex A on page A-2.
Beginning with annual bonusesIndividual Performance Score for 2023, overall STI payout will be weighted as shown below.non-CEO executives. The C&TD Committee believes the new value creation metric aligns executive compensation with the Company’s evolving strategythis change reinforces individual accountability, contributions, and vision. While thoughtful capital allocation remains an integral partownership.
| (1) | Year-end run-rate is estimated based on 2017-2019 mid-cycle margins and modest inflation relative to a 2021 baseline. |
| (2) | Production and marketing includes (i) joint venture production marketed by LYB plus our pro rata share of the remaining production produced and marketed by the joint venture, and (ii) production via third-party tolling arrangements. |
| 2024Proxy Statement | LyondellBasell | 49 |
In 2022, the Company successfully executed the CEO and senior leadership transition as a result of the succession planning process that the Board undertook starting in 2021. As part of our leadership transition, the C&TD Committee devoted significant time to our recruiting, selection, talent development and compensation process, including the appointments of Yvonne van der Laan as our EVP of Circular and Low Carbon Solutions, Tracey Campbell as our EVP of Sustainability and Corporate Affairs, and Trisha Conley as our EVP of People and Culture. In 2023, women now comprise four of the ten members of our Executive Committee, who report directly to our CEO, and together, our CEO and Executive Committee represent six different nationalities. Monitoring the Company’s corporate culture and diversity and inclusion efforts is also a key responsibility of our C&TD Committee, which oversees the Company’s human resources strategy. Our strategy includes efforts to hire, retain, and fairly compensate a diverse and representative workforce.
Our executive compensation program is designed to:
Take into account the realities of a cyclical, commodity industry and reward differential performance
| • | Take into account the realities of a cyclical, commodity industry and reward differential performance |
| • | Align the interests of management with those of our shareholders |
| • | Encourage both short-term and long-term results |
| • | Attract, retain, and incentivize the highest caliber team possible |
| • | Enable us to pay high achievers above-market median compensation based on individual performance, potential, and impact to the Company’s results |
| • | Recognize and maintain the Company’s market-leading position in health and safety |
| • | Emphasize the Company’s deep commitment to sustainability and increase focus on value creation |
Align the interests of management with those of our shareholders
Encourage both short-term and long-term results
Attract, retain, and incentivize the highest caliber team possible
Enable us to pay high achievers above-market median compensation based on individual performance, potential, and impact to the Company’s results
Recognize and maintain the Company’s market-leading position in HSE performance, costs, and business performance
Emphasize the Company’s deep commitment to sustainability and increased focus on value creation
Our compensation program is structured to incorporate the following compensation components:
Component |
| Key Features | Performance-Based | ||
Base Salaries | Provide a regular fixed income in recognition of job responsibilities | Determined when executives are hired or promoted into their position and reviewed annually | Individual performance is a key driver of any annual base salary adjustment. Increases are not guaranteed and must be approved by the C&TD Committee | ||
Short-Term Incentives (STI) | Incentivize executives by aligning their compensation with key annual objectives and the results that are achieved | Target value of annual bonus is determined as a percentage of base salary. Executives earn from 0 to 200% of target based on Company results and (for executives other than the CEO) individual performance | Payout is determined by the C&TD Committee based on corporate performance and achievement of individual goals | ||
Long-Term Incentives (LTI) | Encourage executives to increase shareholder value over the long term and support talent retention | Target value of LTI awards at grant is determined as a percentage of base salary
PSUs – three-year performance period, vest from 0 to 200% of target; PSUs will consist 60% of the executive's target award in 2024 and beyond
RSUs –
Options – for options granted in 2023 and earlier, vest ratably over three | Value of all LTI awards varies in relationship to changes in share price
PSUs pay out based on Company performance, as determined by the C&TD Committee |
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LYONDELLBASELL 2023 PROXY STATEMENT 47
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Our executive compensation program emphasizes the alignment of pay with performance and shareholder value creation, and the mix of compensation components for our NEOs is heavily weighted toward performance-based and variable compensation. Our CEO’s compensation package emphasizes performance-based and variable compensation even more than those of the other NEOs to reflect the fact that the CEO’s actions have the greatest influence on the Company’s overall performance. For 2022,2023, the Total Target Direct Compensation (“TTDC”) of our NEOs was as follows:
The C&TD Committee oversees our executive compensation program, working closely with its independent consultant to ensure the effectiveness of the program throughout the year. Details of the C&TD Committee’s authority and responsibilities are specified in its charter, which can be found on our website at www.LyondellBasell.com by clicking on “Investors,” then “Corporate Governance,” then “Board of Directors.”
Responsible Party | Primary Roles and Responsibilities |
C&TD Committee | • Responsible for determining the compensation of our executive officers (including the NEOs) and designing our executive compensation program • With input from the Committee’s independent compensation consultant, annually conducts a comprehensive analysis and assessment of our executive compensation program, including an evaluation of each component of target compensation for our executive officers, and approves TTDC for the coming year • Approves performance metrics and target performance levels for the Company’s STI program and performance-based equity grants, after receiving input from management and other committees |
Other Independent Members | • Non-executive members of the Board, including the Chair, review and provide input on the C&TD Committee’s decisions relating to the compensation of our executive officers • HSE&S Committee provides input regarding the design and payout for annual safety and sustainability performance metrics |
Chief Executive Officer | • Each year, presents the C&TD Committee with recommendations regarding the compensation of each of the other executive officers (including the other NEOs). These recommendations are based on his assessment of each executive’s performance, the performance of the executive’s business unit or function, benchmark information, and retention risk • Provides input on the overall executive compensation program design • The C&TD Committee reviews CEO recommendations and makes adjustments as it deems appropriate. The CEO does not have any role in the Committee’s determination of his own compensation |
Independent Compensation | • Retained by the C&TD Committee, after assessment of the firm’s independence and determining that the engagement of Pearl Meyer did not raise any conflict of interest or other concerns, to provide advice regarding executive compensation matters • Advises on the design of our executive compensation program and evolving industry practices • Provides market data and analysis regarding the competitiveness of our executive compensation program • Evaluates proposed compensation decisions and program updates. • Attends regularly-scheduled meetings of the C&TD Committee and telephone conferences with members of the Committee or its Chair throughout the year to assist with the review and discussion of executive compensation matters |
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LYONDELLBASELL 2023 PROXY STATEMENT 48
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Annually, the C&TD Committee reviews the TTDC for each of our executive officers, which includes base salaries, target bonuses, and the grant date value of long-term incentive awards. The Committee strives to set our NEOs’ TTDC and each individual component of executive compensation near the median compensation levels of our peer group companies, while considering other factors described below. A large portion of the TTDC opportunity for our NEOs is directly tied to the achievement of financial and operational metrics that measure our performance in both absolute terms and relative to peers.
The Committee reviews publicly available financial and compensation information reported by our peer group companies (described below) and general survey data. The survey data used to inform the Committee’s 20222023 compensation decisions was collected from the 20212022 Willis Towers Watson Executive Compensation Database. This survey data reflects a combination of general industry and chemical industry compensation for executives with responsibilities similar to those of our executives.
The Committee reviews the peer group and survey data to determine the median compensation for each executive’s position and then sets each executive’s base salary and compensation targets for the current year. This generally involves establishing an annual bonus target and the target value of LTI awards as a percentage of base salary. Median compensation is used as a reference point for pay recommendations. Actual pay and targets vary from median based on the executive’s industry experience; experience and performance in his or her role and at the Company; value of the role to the Company; internal pay parity among our executives; and any other factors the Committee deems relevant.
The compensation peer group is also used more generally when the Committee reviews our compensation program design, including the types of compensation awarded and the terms and conditions of compensation components.
The C&TD Committee conducts an annual review of the Company’s executive compensation peer group to determine if any changes are necessary. In choosing our peers, the Committee involves management and uses research and advice from the Committee’s independent compensation consultant and considers companies that operate in similar industries or are identified as potential competitors for business or talent, with consideration given to company size and comparability of financial, operating and business considerations.
The C&TD Committee believes the 18-company peer group below represents a reasonable balance in terms of industry mix and financial size while providing a robust set of data points for benchmarking executive pay. In September 2021,2022, the Committee reviewed and approved continuing to use of the 20212022 peer group for 2022.2023.
3M Company
| Deere & Company
| Honeywell International Inc.
| Phillips 66
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HollyFrontier Corporation acquired Sinclair Oil in March 2022. Post-acquisition the company changed its name to HF Sinclair Corporation.
The 20222023 peer group reported 20222023 revenue that ranged from approximately $13.0$12.1 billion to $177.5$148.4 billion, with a median revenue of approximately $36.8$35.4 billion. In comparison, the Company’s 20222023 revenue was approximately $50.5$41.1 billion. The 20222023 peer group was used to develop the market data and benchmarking materials that were provided to the C&TD Committee to assist with the 20222023 decision-making process.
| 2024Proxy Statement | LyondellBasell | 52 |
LYONDELLBASELL 2023 PROXY STATEMENT 49
The compensation of our executive officers, including our NEOs, is reviewed and approved by the C&TD Committee at the time of each executive’s hiring or promotion and annually during a regularly scheduled meeting held in February. Decisions are made based on the Company’s and each executive’s performance in the prior year, other than with respect to PSU payouts, for which decisions are based on Company performance over a three-year period. February 20222023 compensation decisions included the approval of 20222023 base salaries; target values, criteria and metrics for the 20222023 annual bonuses to be paid in 2023;2024; and 20222023 grants of annual long-term incentive awards, including PSUs, RSUs and stock options, as described on pages 55-57.58-59. In February 2023,2024, the Committee approved payout of 20222023 annual bonuses and the percentage earned for the PSUs granted in 20202021 with a performance period that ended December 31, 2022.2023.
The table below shows the base salaries for our NEOs in 20212022 and 2022.2023. Salary changes are generally approved at the C&TD Committee’s February meeting and effective on April 1. The Committee reviews market data and considers internal pay parity when making its decisions. The Committee also considers each executive’s performance during the prior year, any changes in responsibilities, and the executive’s time in role. The 20222023 salary increases for Messrs. GuilfoyleVanacker, McMurray and Kaplan,Rhenman, each effective April 1, 2022,2023, represented annual salary adjustments to maintain market competitiveness. Mr. Lane received a salary increase, effective October 1, 2022, in connection with his appointment as EVP, Global Olefins and Polyolefins.
Name | 2021 Base | 2022 Base | Increase | ||
Peter Vanacker | $ | — | $ | 1,400,000 | — |
Ken Lane(1) | $ | 793,100 | $ | 870,000 | 10% |
Michael McMurray | $ | 824,000 | $ | 824,000 | — |
Jim Guilfoyle | $ | 700,000 | $ | 793,100 | 13% |
Jeffrey Kaplan | $ | 695,000 | $ | 716,000 | 3% |
Torkel Rhenman | $ | 793,100 | $ | 793,100 | — |
From January 1, 2022 to May 22, 2022, Mr. Lane served as interim CEO and his base salary was $1,200,000. From May 22, 2022 to September 30, 2022, his base salary was $793,100. From October 1, 2022 to December 31, 2022, his base salary was $870,000.
| Name | 2022 Base | 2023 Base | Increase | ||
| Peter Vanacker | $ | 1,400,000 | $ | 1,450,000 | 4% |
| Michael McMurray | $ | 824,000 | $ | 850,000 | 3% |
| Ken Lane(1) | $ | 870,000 | $ | 870,000 | — |
| Jim Guilfoyle | $ | 793,100 | $ | 793,100 | — |
| Torkel Rhenman | $ | 793,100 | $ | 800,000 | 1% |
| (1) | Mr. Lane resigned from his position effective March 15, 2024. |
The Company’s annual bonus program rewards participants for achieving the Company’s annual objectives. Under this short-term incentive, or STI, program, the C&TD Committee establishes metrics and target performance levels and sets a target bonus, determined as a percentage of base salary, for each executive. In 2022,2023, our NEOs’ target bonuses were as follows:follows.
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Michael McMurray | 95% |
| Ken Lane(1) | 95% |
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From January 1, 2022 to May 22, 2022, Mr. Lane served as interim CEO and his STI target bonus was 150%.
The amount of target bonus earned depends on the C&TD Committee’s determination of Company and individual performance under each of the STI program metrics. STI awards for 20222023 were calculated in the same manner as in prior years, as follows:
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Mr. Vanacker’s STI payouts are, and Mr. Lane’s payouts while serving as Interim CEO were, based entirely on 
Overall payout under the STI program will not exceed 200%Performance – Payout at 127% of an individual’s target bonus.Target
LYONDELLBASELL 2023 PROXY STATEMENT 50
Payout for the Company performance component of the 20222023 STI award was based on achievement of target performance levels for four metrics: business results, value creation, safety performance, costs and sustainability, weighted as described below.
| (1) | The Company performance component of Mr. Guilfoyle’s STI payout is based 60% on Company performance and 40% on his award unit performance. |
| (2) | Mr. Vanacker’s STI payouts are based entirely on Company performance. There is no individual performance component for the CEO. |
| (3) | Overall payout under the STI program will not exceed 200% of an individual’s target bonus. |
| (4) | Production and marketing includes (i) joint venture production marketed by LYB plus our pro rata share of the remaining production produced and marketed by the joint venture, and (ii) production via third-party tolling arrangements. |
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| WHY EBITDA? We believe that EBITDA is the financial measure that best enables shareholders to gauge our profitability and assess our business results. We determine performance under this metric by comparing EBITDA to our annual EBITDA budget, after making certain non-discretionary adjustments at the end of the year to account for market tailwinds and headwinds. Our aim is to ensure that our compensation rewards differential rather than circumstantial performance. These adjustments are reviewed in detail with, and approved by, the C&TD Committee to ensure they are rigorous and support the alignment of pay and performance. |
WHY EBITDA?
We believe that EBITDA is the financial measure that best enables shareholders to gauge our profitability and assess our business results. We determine performance under this metric by comparing EBITDA to our annual EBITDA budget, after making certain non-discretionary adjustments at the end of the year to account for market tailwinds and headwinds. Our aim is to ensure that our compensation rewards differential rather than circumstantial performance. These adjustments are reviewed in detail with, and approved by, the C&TD Committee to ensure they are rigorous and support the alignment of pay and performance.
The C&TD Committee considers the Company’s EBITDA relative to the adjusted EBITDA budget. Payout at 92%126% of target was based on 20222023 EBITDA that came in belowabove the Company’s adjusted EBITDA budget for the year by approximately 1.2%3.9%.
At its regularly scheduled 20222023 November meeting, the Board reviewed the Company’s annual EBITDA budget for the coming year and, the following February, approved the final annual STI EBITDA target. After completion of the year, and in order to ensure that our executives are compensated on the basis of differential rather than circumstantial performance, the Company’s EBITDA budget may be adjusted in three primary ways. These adjustments can increase the EBITDA budget in an upcycle or lower the budget in a downturn and are used as a tool to ensure the Committee pays for actual performance, not performance due to the volatility and cyclicality of the chemicals industry, which is heavily influenced by energy prices.
Specifically, these adjustments account for (i) differences between actual market margins or spreads and budget assumptions, (ii) movements in foreign-exchange rates, the mark-to-market of certain assets (e.g., precious metals), and the same fixed cost exclusions taken into account when measuring the Company’s cost performance, and (iii) the budget impact of significant unanticipated events. All adjustments are reviewed and approved by the C&TD Committee and are subject to certain thresholds before an adjustment will be considered.
Adjustments for actual market margins or spreads are calculated using independent third-party sources whenever available, including IHS Markit (IHS) and Phillip Townsend Associates (PTAI). No market adjustments are made for businesses that do not have market references, including our Advanced Polymer Solutions (APS) and Technology segments. In 2022,2023, additional adjustments were made for the volume impacts of the December 2022 U.S. winter storm event, the unanticipated increases in natural gas and energy costs, and costs incurred from ceased operations in Russia and plans to exit the refinery business.
The table below summarizes the approved adjustments, both positive and negative, to the Company’s 20222023 EBITDA budget by segment, which collectively decreased the EBITDA budget by 17%4%. To avoid disclosing competitively-sensitive information, we do not provide specific details on market impacts.
Segment(s) | Description of EBITDA Budget Adjustments | |
Olefins & Polyolefins – Americas | Ethylene cash margin (IHS), polyethylene spread (PTAI), and polypropylene spread (PTAI) | |
Olefins & Polyolefins – Europe, Asia, International |
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Intermediates & Derivatives | U.S. methanol variable margin (IHS), styrene raw material margin (IHS), NA MTBE raw material margin (IHS) and EU MTBE raw material margin (IHS) | |
Refining | Maya 2-1-1 crack spread, net of RINs and co-product spread, | |
All | Foreign-exchange rate impacts, mark-to-market adjustments, and fixed cost exclusions | |
| Net EBITDA | 17% |
We define EBITDA as Income from continuing operations before interest expense (net), provision for (benefit from) income taxes and depreciation and amortization. For a reconciliation of EBITDA to net income for the year ended December 31, 2022,2023, please refer to Appendix A. At the C&TD Committee’s discretion, the Company’s annual EBITDA results may bemaybe adjusted for the impact of certain extraordinary events during the year. For 2022,2023, approved EBITDA adjustments included the impacts of the December 2022 U.S. winter storm event, settlement of pension obligations, and costs incurred due to ceased operations in Russia and plans to exit the refinery business.
LYONDELLBASELL 2023 PROXY STATEMENT 52
Backbusiness and impairments made to Contentstangible assets in our global O&P and I&D segments and intangible assets in our APS segment.
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| WHY VALUE CREATION? We believe in aligning executive compensation with the Company’s evolving strategy and vision, which focuses on capturing value, improving agility and accelerating innovation. We believe our value creation metric incentivizes employees to bring forth new financial value creating ideas and initiatives in line with our new culture. |
Payout under the value creation metric is determined by the achievement of incremental EBITDA targets supporting our goal of delivering up to $1 billion in recurring annual EBITDA improvement by the end of 2025. Payout at 200% of target reflects the Company exceeding our original 2023 recurring annual EBITDA exit run-rate target of $150 million, bringing us closer to delivering on our long-term VEP goal.
| WHY SAFETY PERFORMANCE? Operating in a safe, reliable manner protects our employees, our assets, and the communities in which we operate. We believe our focus on safety performance is the right thing to do, and it helps contain costs of operations and avoid operational upsets and reputational harm. |
WHY SAFETY PERFORMANCE?
Operating in a safe, reliable manner protects our employees, our assets, and the communities in which we operate. We believe our focus on safety performance is the right thing to do, and it helps contain costs of operations and avoid operational upsets and reputational harm.
The C&TD Committee primarily considers the Company’s performance in personal safety (50%) and process safety (50%) and has discretion to adjust the resulting payout to account for environmental incidents and extraordinary trends and circumstances. Personal safety is measured by the Company’s total recordable incident rate (“TRIR”), calculated as the number of injuries per 200,000 hours worked. Process safety is measured by the Company’s process safety incident rate (“PSIR”), which represents the number of Tier 1 incidents, as measured by the American Chemistry Council, per 200,000 hours worked. In 2022,2023, the Company achieved outstanding TRIR of 0.12, in the top quintile for the industry,0.139 and no fatalities occurred. The Company’s PSIR also improved slightly compared to the prior year to 0.026 and resultedwas 0.035, resulting in overall payout at 136%102% of target.
| WHY SUSTAINABILITY? To tackle the global challenges of plastic waste and climate change, we set 2030 goals to reduce our scope 1 and 2 emissions by 42% and scope 3 emissions by 30%. We also set a goal to produce and market at least 2 million metric tons of recycled and renewable-based polymers annually by 2030.(1) We believe that the sustainability metric incentivizes accountability and timely delivery of our climate and circularity goals. |
WHY COSTS?
We believe maintaining controllable costs is important to our success. We operate in an industry where a substantial portion of operating costs are market-driven and, in response, we drive a culture of cost discipline and strive to keep our fixed costs among the lowest in the industry.
The C&TD Committee considers the Company’s adjusted fixed costs as compared to our annual cost budget, adjusted downward (in 2022, by 2.6%) for the impact of foreign exchange rates. 2022 adjustments to fixed costs (cumulative impact of approximately 4.8%), all of which were approved by the C&TD Committee and subject to de minimis thresholds, accounted for the increased fixed costs resulting from the true-up of current and prior year bonus payments and unbudgeted expenditures on strategic transaction activity and related to site closures. Payout at 140% of target recognized that the Company’s continued commitment to cost discipline resulted in adjusted fixed costs that were below budget by 1.2%.
WHY SUSTAINABILITY?
To tackle the global challenges of plastic waste and climate change, we set 2030 goals to reduce our scope 1 and 2 emissions by 42% and scope 3 emissions by 30%. We also set a goal to produce and market at least 2 million metric tons of recycled and renewable-based polymers annually by 2030. We believe that the sustainability metric ensures accountability and timely delivery of our climate and circularity goals.
The C&TD Committee considers the Company’s achievement of key milestones supporting our sustainability goals. For 2022,2023, the Committee set goals to achieve certain milestones, with target (100%) performance summarized below. Payout at 125%110% of target reflected the Company’s delivery on these goals.
Milestone | Result | ||
  | Execution of power purchase agreements Execute PPAs with cumulative | ||
  | Implementation of Progress
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Produce and market 150kt of
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| (1) | Production and marketing includes (i) joint venture production marketed by |
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LYONDELLBASELL 2023 PROXY STATEMENT 53
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The payouts awarded for the individual performance component of the NEOs’ STI award reflect their individual contributions to achieving successful Company performance, whether they met or exceeded expectations for their respective roles, and any other significant factors during the year, such as special projects, challenges, or other performance issues. Individual performance ratings range from 0 to 200%.
Name | Individual Target Bonus | Company Performance Component |
| Individual Performance Component | STI Payout (as a % of salary) | STI Payout | |||||||||
Peter Vanacker | 150% | x | 109% |
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| = | 164% | $ | 1,398,485 |
Ken Lane | 150% | x | 109% |
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| = | 164% | $ | 763,299 |
| 95% | x | ( (109% | x | 75%) | + | (109% | x | 180% | x | 25%) ) | = | 124% | $ | 626,189 |
Michael McMurray | 90% | x | ( (109% | x | 75%) | + | (109% | x | 150% | x | 25%) ) | = | 110% | $ | 909,387 |
Jim Guilfoyle | 95% | x | ( (109% | x | 75%) | + | (109% | x | 110% | x | 25%) ) | = | 106% | $ | 817,421 |
Jeffrey Kaplan | 90% | x | ( (109% | x | 75%) | + | (109% | x | 150% | x | 25%) ) | = | 110% | $ | 784,481 |
Torkel Rhenman | 95% | x | ( (109% | x | 75%) | + | (109% | x | 150% | x | 25%) ) | = | 116% | $ | 923,912 |
| Name | Individual Target Bonus | Company Performance Component | Individual Performance Component | STI | STI Payout | ||||||||
| Peter Vanacker | 160% | x | 127% | = | 203% | $ | 2,946,400 | ||||||
| Michael McMurray | 95% | x | ( (127% | x | 75%) | + | (180% | x | 25%) ) | = | 133% | $ | 1,132,519 |
| Ken Lane | 95% | x | ( (127% | x | 75%) | + | (150% | x | 25%) ) | = | 126% | $ | 1,097,179 |
| Jim Guilfoyle(1) | 95% | x | ( (122% | x | 75%) | + | (120% | x | 25%) ) | = | 116% | $ | 916,566 |
| Torkel Rhenman | 95% | x | ( (127% | x | 75%) | + | (90% | x | 25%) ) | = | 112% | $ | 894,900 |
| (1) | The Company performance component of Mr. Guilfoyle’s STI payout (122%) is based 60% on Company performance (127%) and 40% on his award unit performance (115%). |
The C&TD Committee has determined that our CEO’s payout under the STI program should be directly tied to, and determined by reference to, Company performance. There was no individual performance component to Mr. Vanacker’s annual STI award. Mr. Lane’s STI award was pro-rated to reflect his service as interim CEO from January 1, 2022 to May 22, 2022, as well as the increase to his base salary effective October 1, 2022 in connection with his appointment as EVP, Olefins and Polyolefins. The Committee’s evaluation of each other NEO’s individual performance is described below.
Mr. McMurray’s individual performance rating of 180% is the result of his outstanding leadership of the finance function. In 2023, he successfully helped the Company navigate a challenging market environment, transform the Company’s Advanced Polymer Solutions segment, and create the new CLCS segment, and led the business through a challenging budget process for 2024. He demonstrated excellent cash management and a strong focus on shareholder returns, and was instrumental in helping drive forward the Company’s Value Enhancement Program. Mr. McMurray did an outstanding job leveraging his financial acumen and leadership to help the Company effectively unveil its new strategy and core purpose at the Company’s Capital Markets Day. Further, he has driven an excellent approach to investor relations management, focusing on consistency and clarity. Mr. McMurray effectively translated business strategy into clear, trackable strategic planning, simplifying key financial planning processes and further developing the global operating model and OneFinance transformation initiative for the Finance function. He effectively drove the reorganization of the finance function, bringing in top talent to reinforce a strong business focus and a proactive approach to merger and acquisition management, positively impacting key strategic initiatives. He also successfully oversaw the issuance of the Company’s inaugural green bonds, helping advance the Company’s long-term sustainability goals.
Mr. Lane’s individual performance rating of 180% is based on his strategic leadership as Interim Chief Executive Officer, including the seamless transition of responsibility to Mr. Vanacker and decision-making with respect to the Company’s Houston refinery and capital allocation strategy. Mr. Lane served as a key leader to drive the Company’s ongoing strategy work forward, led the Company’s Olefins & Polyolefins, Americas segment, and navigated a challenging market for the Olefins & Polyolefins, Europe, Asia, International segment. During his service as Interim CEO, he championed the LYB University concept to further develop key talent, launched our customer centricity and excellence initiative, and established the roadmap for implementation. He also elevated diverse talent to senior roles, oversaw work to create a dashboard to track progress on DEI objectives, and ensured diverse candidate slates and selection teams for open positions.
Mr. McMurray’s individual performance rating of 150% is athe result of his leadership of the finance function, including significant efforts with respect to the Company’s capital allocation strategy. Alongside Mr. Lane, Mr. McMurray was a key leader to drive the Company’s ongoing strategy work forward,Olefins & Polyolefins (“O&P”) segment and Procurement function. In 2023, he led the installation of a transformation office and the establishment of the Company’s value enhancement program with strong governance and rigorous standard for capturing value. He successfully helped the Company navigatenavigated a volatile and challenging market environment leadingwhile delivering substantial contributions to the CompanyCompany’s net income through the implementation of the Company’s Value Enhancement Program within the O&P business segment and procurement. He successfully transformed the O&P business by setting up integrated business teams and bringing manufacturing sites closer to achieve its second highest performance in cash generation. Mr. McMurraycustomers. Further, he effectively drove improvements in senior finance leadership succession,manufacturing reliability, the depth of the talent bench and the talent development process, with a particular focus on diversity, equity and inclusion. During 2022, Mr. McMurray recruited and hired two diverse individuals to join the Company’s Finance Leadership Team, which reports to him. In addition, Mr. McMurray is an active co-sponsorfocused expansion of the Company’s Young Professional Network.sustainable procurement program, and the successful implementation of the Company’s greenhouse gas emission reduction program. Mr. Lane also led the development of several new strategic initiatives aimed at growing and upgrading the Company’s core business.
Mr. Guilfoyle’s individual performance rating of 110%120% reflects his leadership of the APSOlefins & Polyolefins segment for the Europe, Africa, Middle East, and supply chain function in a veryIndia region (EAMEI), navigating challenging year impacted by the automotive market high inflation, supply chain issuesconditions while demonstrating strong cash management and demand for talent. In 2023,execution under weak demand. Mr. Guilfoyle becameled strong improvements in manufacturing performance with record setting safety performance for the executive sponsoryear and exceeding plan targets for the Company’s value enhancement program for several manufacturing sites in EAMEI. Further, he drove several key initiatives in the region for Olefins & Polyolefins, including the launch of the Company’s new Global Latin Network for employees,Customer and continued to advance diversityCommercial Excellence program, the development of business teams in the leadershipsupport of the APS segment, one of the most diverse in the Company.
Mr. Kaplan’s individual performance rating of 150% is based on his leadership ofgrowing the Company’s legal departmentcore business, and real estate and facilities functions. He provided key support to Mr. Lane during his service as Interim CEO and provided continuity during the transition and onboardingexecution of Mr. Vanacker. Mr. Kaplan was a strong and visible leader of the Company’s sustainability efforts, establishing and working with cross-functional teams and leading the corporate communications function through October 2022. He supported decision-making efforts with respect to the Houston refinery. Mr. Kaplan also achieved his personal DEI objectives, including establishing and meeting DEI objectives for the legal team and implementing DEI-focused interview processes and best practices. In addition, Mr. Kaplan is an active co-sponsor of the Company’s Young Professional Network.several strategic projects.
| 2024Proxy Statement | LyondellBasell | 57 |
Mr. Rhenman’s individual performance rating of 150%90% reflects his leadership of the Intermediates & DerivativesAdvanced Polymer Solutions (“APS”) segment leading to record earnings, and his work was vital to both improveduring the operation of, and explore strategic options for, the Houston refinery. As partrepositioning of the Company’sAPS segment as a stand-alone and customer-focused business. He successfully developed a new APS business strategy, evaluation,organization structure, value propositions, and business model. Mr. Rhenman led workstreams fordrove the I&D segment and improved the focussuccessful restoration of the business by anticipating customer demand. He also achieved his personal DEI objectives, including mentoring diverse employees within his organization, sponsoringAPS service level to the industry benchmark with strong cash flow performance and the establishment of a project pipeline exceeding $500 million through the Company’s Black employee network, and serving on local community boards that promote diversity.Value Enhancement Program. Despite these efforts, for 2023, business results did not meet the performance plan expectations.
The long-term incentive awards granted to the NEOs in 20222023 included PSUs (50%), RSUs (25%), and stock options (25%). The allocation among these types of awards was determined by the C&TD Committee to be the most appropriate split between equity that is performance-based (PSUs) and time-based (RSUs and stock options). RSUs granted for 2021, 2022 and 2023 cliff vest after three years while stock options vest ratably over a three-year period, balancingperiod. The C&TD Committee believes this mix balances executive retention with the ability to offer partial, near-term vesting to potential executive hires.
  | Performance-based awards that pay out at 0 to 200% of target based on the Company’s TSR over a three-year period and free cash flow per share relative to long-range plan projections. PSUs reward our executives if our performance over the period compares favorably to peers and expectations. |
  | Time-based awards that cliff vest after three years. RSUs provide retention value and encourage executives to consider the Company’s long-term success, strengthening the alignment between their interests and those of our shareholders. |
  | Time-based awards that are intended to direct executives’ focus toward increasing the market value of our shares. Options vest ratably over three years, expire ten years from the date of grant, and only provide value to the executive if there is an appreciation of our stock price over time. |
The value of long-term incentive awards granted to the NEOs is determined as a percentage of base salary. The C&TD Committee reviews the target awards annually and recommends changes based on the executive’s time and experience in the position, changes in job responsibilities, and market data. At the February 20222023 C&TD Committee meeting, it was determined that each NEOcertain NEOs would receive an increase in LTI target value in order to bring histheir compensation closer to the median of market.
Name | 2021 Target (% of base salary) | Total Value of 2021 LTI Awards | 2022 Target (% of base salary) | Total Value of 2022 LTI Awards | |||
Peter Vanacker |
| — | $ | — | 714% | $ | 10,000,000 |
Ken Lane |
| 280% | $ | 2,220,500 | 300% | $ | 2,610,000 |
Michael McMurray |
| 320% | $ | 2,637,000 | 350% | $ | 2,884,000 |
Jim Guilfoyle |
| 280% | $ | 1,960,000 | 300% | $ | 2,379,000 |
Jeff Kaplan |
| 270% | $ | 1,877,000 | 290% | $ | 2,076,000 |
Torkel Rhenman |
| 280% | $ | 2,220,500 | 300% | $ | 2,379,000 |
| Name | 2022 Target (% of base salary) | Total Value of 2022 LTI Awards | 2023 Target (% of base salary) | Total Value of 2023 LTI Awards | ||
| Peter Vanacker | 714% | $ | 10,000,000 | 759% | $ | 11,000,000 |
| Michael McMurray | 350% | $ | 2,884,000 | 400% | $ | 3,400,000 |
| Ken Lane(1) | 300% | $ | 2,610,000 | 310% | $ | 2,697,000 |
| Jim Guilfoyle | 300% | $ | 2,379,000 | 300% | $ | 2,379,000 |
| Torkel Rhenman | 300% | $ | 2,379,000 | 310% | $ | 2,480,000 |
| (1) | Mr. Lane resigned from his position effective March 15, 2024. Upon his departure, he forfeited any unvested long-term incentive awards. |
For a description of the vesting and forfeiture of LTI awards upon termination, please see “Potential Payments Upon Termination or Change in Control” at pages 68-71.on page 74.
| 2024Proxy Statement | LyondellBasell | 58 |
One-half of the value of our NEOs’ annual equity award in 20222023 was granted in the form of PSUs. The number of units awarded was determined by dividing that dollar amount by the fair market value of our stock on the grant date, based on the average closing price of the Company’s shares over the 20 trading days prior to the date of grant. PSUs accrue dividend equivalents during the performance period, which will be converted to additional units using the closing stock price as of the end of the performance period on December 31, 2024.2025. Each unit deemed to be earned on the basis of Company performance will pay out in one share of the Company’s common stock after the performance period concludes.
The number of 20222023 PSUs earned will depend 50% on the Company’s TSR over the performance period as compared to selected industry peers and 50% on free cash flow per share as compared to long-range plan projections. We believe use of relative TSR as the metric for performance provides transparency for shareholders and our executives, rewards our executives if we out-perform our peers, and promotes executive accountability to and alignment with our shareholders. Likewise, we believe use of free cash flow per share as a second metric to our PSUs also provides an important measure of performance and rewards our executives for their ability to generate cash from business operations, which is key to our ability to fund growth projects, repay debt, and return capital to shareholders. For further alignment with shareholder interests, the terms of the PSUs provide that no payout will be earned for any year in the performance cycle in which the Company’s quarterly dividend is not paid.
LYONDELLBASELL
To determine payout under the relative TSR metric, the C&TD Committee compares TSR for the entire three-year performance period, using a 20-day closing average stock price at the beginning and the end of the period and assuming all dividends are reinvested. As shown below, payout will range from 0 to 200% of target. There is no payout for TSR in the bottom quartile of the peer group.
| 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 |
Positive TSR | 200% | 200% | 200% | 200% | 200% | 180% | 160% | 140% | 120% | 100% | 80% | 70% | 60% | 50% | — | — | — | — | — |
Negative TSR | 100% | 100% | 100% | 100% | 100% | 95% | 90% | 85% | 80% | 75% | 70% | 60% | 50% | 40% | — | — | — | — | — |
| 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | ||||||||||||||||||||
| Positive TSR Payout | 200% | 200% | 200% | 200% | 200% | 180% | 160% | 140% | 120% | 100% | 80% | 70% | 60% | 50% | — | — | — | — | — | |||||||||||||||||||
| Negative TSR Payout | 100% | 100% | 100% | 100% | 100% | 95% | 90% | 85% | 80% | 75% | 70% | 60% | 50% | 40% | — | — | — | — | — |
The companies that are used as comparators in determining our relative TSR performance (shown below) are eighteen of the Company’s primary competitors, either directly or for investment dollars, in the chemicals industry. For 2022,2023, the C&TD Committee maintained the same TSR peer group as used for the 20212022 PSUs, including companies, both within and outside of the S&P 500 Chemicals Index, with business models most similar to that of the Company. The C&TD Committee has provided for adjustments to the peer group in the event of bankruptcies, acquisitions, or going-private transactions involving any of the peers during the performance period.
Akzo Nobel
Corporation | Celanese Corporation
DSM-Firmenich AG | Eastman Chemical Company
| PPG Industries, Inc. |
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| 2024Proxy Statement | LyondellBasell | 59 |
To determine payout under the free cash flow per share metric, the C&TD Committee will compare the Company’s average annual FCF per share during the performance cycle to the expected average annual FCF per share during the period. We define free cash flow per share as (i) cash flow from operating activities less capital expenditures for the year divided by (ii) the number of weighted average shares outstanding for the year.
Target FCF per share for the 20222023 PSUs, which would result in 100% payout for the metric, was set by the C&TD Committee at the beginning of the performance cycle based on a reasonably-achievable level of performance as determined by the Company’s long-range plan projections. While the Company believes disclosing specific targets during an ongoing performance period would result in competitive harm, the targets will be disclosed along with performance achievement after the performance period has ended and the awards are earned. As shown below, maximum payout of 200% for the metric is awarded if realized FCF per share is equal to or greater than 135% of target, representing a stretch goal that can be achieved only in the event of outstanding performance. There is no payout if realized FCF per share is less than 75% of target. Actual payout will be interpolated between data points.
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FCF per Share (% of Target) | ≥ 135% | 130% | 125% | 120% | 115% | 110% | 95-105% | 90% | 85% | 80% | 75% | < 75% |
Payout | 200% | 183% | 167% | 150% | 133% | 117% | 100% | 88% | 75% | 63% | 50% | — |
LYONDELLBASELL
| FCF per Share (% of Target) | ≥ 135% | 130% | 125% | 120% | 115% | 110% | 95-105% | 90% | 85% | 80% | 75% | < 75% | ||||||||||||
| Payout | 200% | 183% | 167% | 150% | 133% | 117% | 100% | 88% | 75% | 63% | 50% | — |
In 2022,2023, each of our NEOs received a number of RSUs calculated by dividing 25% of the dollar amount of his LTI target by the fair market value of the Company’s shares, based on the average closing price of the Company’s shares over the 20 trading days prior to the date of grant. The 20222023 RSU grants vest in full three years after the date of grant. In addition, Mr. Lane received a one-time grant of RSUs on May 26, 2022 in connection with his service as interim CEO, which will vest in full two years after the date of grant.
Upon vesting, holders of RSUs receive one share of the Company’s common stock for each RSU. RSU holders also receive cash dividend equivalents on their units throughout the vesting period.
The number of options granted to each NEO is determined by dividing 25% of the value of his annual LTI target by the Black-Scholes value of options for the Company based on the 20 trading days prior to the grant date. The options granted to the NEOs in 20222023 vest in three equal installments beginning on the first anniversary of the grant date and expire ten years after the grant date. The exercise price of the options is the fair market value of the Company’s shares on the grant date.
Each of our NEOs (other than Mr. Vanacker, who joined the Company in 2022) received a PSU award with a performance period that ended December 31, 2022.2023. Payout of these PSUs is determined based solely50% on the Company’s TSR relative TSRto our peers over the performance period.period and 50% on the Company’s FCF per share relative to long-range plan projections. At its meeting in February 2023,2024, the C&TD Committee determined that 100%200% had been earned under the 20202021 PSUs, reflecting the fact that the Company’s TSR fell in the 50th percentiletop quartile of selected peers.peers and the Company’s FCF per share exceeded the target set by the C&TD Committee.
On December 30, 2022, special cash retention awards granted to certain officers of
While the Company believes disclosing specific targets during an ongoing performance period would result in competitive harm, the performance period for the 2021 in connectionPSUs ended December 31, 2023. TSR and FCF per share targets for the 2021 PSUs are disclosed below, along with our former CEO retirement, including Messrs. Lane, McMurray, Guilfoyle, Kaplan and Rhenman, vested according to their terms. The awards were granted as a one-time addition to our executive compensation program, and any future retention awards will be evaluated on a case-by-case basis and granted only in limited circumstances, in accordance with the Committee’s view that special awards should be used sparingly and only in unusual circumstances.performance results.
| 2024Proxy Statement | LyondellBasell | 60 |
The vested awards for each NEO were as follows:
Name | Retention Award | |
Ken Lane | $ | 2,000,000 |
Michael McMurray | $ | 1,500,000 |
Jim Guilfoyle | $ | 2,000,000 |
Jeffrey Kaplan | $ | 1,500,000 |
Torkel Rhenman | $ | 2,000,000 |
| Back to Contents |
| Actual Result: 23.48% | |||||||||||||||||||
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| Percentile | 100% | 94% | 89% | 83% | 78% | 72% | 67% | 61% | 56% | 50% | 44% | 39% | 33% | 28% | 22% | 17% | 11% | 6% | 0% |
| Peer Group TSR(%) | 68.23 | 32.96 | 23.48 | 20.89 | 18.3 | 10.72 | 8.34 | 7.07 | -0.41 | -3.61 | -6.15 | -8.13 | -12.78 | -19.6 | -19.65 | -24.3 | -27.97 | -41.98 | -46.19 |
| Payout(%) | 200 | 200 | 200 | 200 | 200 | 180 | 160 | 140 | 120 | 100 | 80 | 70 | 60 | 50 | — | — | — | — | — |
Actual Result: $13.57 | ||||||||||||
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| FCF per Share Target($) | ≥ 9.53 | 9.18 | 8.83 | 8.47 | 8.12 | 7.77 | 7.06 | 6.35 | 6.00 | 5.65 | 5.30 | < 5.30 |
| Payout (%) | 200 | 183 | 167 | 150 | 133 | 117 | 100 | 88 | 75 | 63 | 50 | — |
The Company’s Share Ownership Guidelines require executives to achieve an ownership of Company shares that is valued at a percentage of their respective base salaries. Executives are expected to meet or exceed the guidelines within five years of their hiring or promotion into their role. They may not sell shares unless and until these ownership levels have been met and then only shares in excess of the required levels may be sold. Under the guidelines, only shares beneficially owned and RSUs count towards meeting the ownership thresholds. Performance awards, stock options, stock appreciation rights, and dividend equivalents are not counted.
We determine compliance with our Share Ownership Guidelines on a quarterly basis. The number of shares held by each of our continuing NEOs as a multiple of base salary as of December 31, 20222023 is set forth below. Mr. Vanacker is still within the five-year transition period for attaining the required ownership. Mr. Lane is no longer subject to the Share Ownership Guidelines following his departure on March 15, 2024.
Name | Required Ownership
| Shares held
| Complies or
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Peter Vanacker | 6x |
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Jim Guilfoyle | 3x |
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Under the Company’s clawback policy, a copy of which is attached to our 2023 Annual Report in accordance with SEC rules, the C&TD Committee can elect to recover annual bonus or equity compensation from any executive determined to have engaged in misconduct that increased the value of the compensation he or she received. Annual bonus compensation may be recovered if an executive engages in misconduct, including any act or failure to act causing a violation of law, Company policies, or GAAP, whether or not such misconduct affected the calculation of his or her bonus compensation. In light of the SEC’s adoption of final clawbackaccordance with SEC rules in October 2022, we intend to amendand NYSE listing standards, our clawback policy in orderalso allows the Company to comply with final NYSE listing standards when effective.recover incentive-based compensation erroneously received by current or former executive officers after an accounting restatement.
All of our executive officers, including our NEOs, are subject to our Policy Prohibiting Insider Trading. Under this policy, executives may not purchase, sell or write options on LyondellBasell shares, engage in short sales, or participate in any other derivative or short-term purchase or sale transactions that would enable them to hedge the economic risk of their share ownership. Additionally, our executives are prohibited from pledging LyondellBasell shares as collateral for personal loans or other obligations, including holding shares in a brokerage margin account. These restrictions extend to executives’ immediate family members and certain related entities and are intended to keep our executives’ interests aligned with the long-term interests of the Company and our shareholders.
| • | No hedging • No short sales • No pledging • No margin accounts | |||
LYONDELLBASELL 2023 PROXY STATEMENT 58
Our NEOs receive the same benefits generally provided to all of our employees, which include vacation allowances, Company matching under our 401(k) plan, Company contributions to our defined benefit pension plan, and health and welfare benefits. The perquisites received by our executives that are not offered to all employees include:
Annual executive physical.
| • | Annual executive physical. |
| • | Financial, tax, and estate planning — The Company will reimburse approximately $15,000 of expenses. |
| • | Matching under the U.S. Deferral Plan — The Company makes contributions to the U.S. Deferral Plan for amounts that exceed the IRS base salary limits on matching under our 401(k) plan and contributions to our defined benefit pension plan. The value of the contributions is 11% for all base salary compensation in excess of the IRS limits. |
Financial, tax, and estate planning — The Company will reimburse up to $15,000 of expenses.
Matching under the U.S. Deferral Plan — The Company makes contributions to the U.S. Deferral Plan for amounts that exceed the IRS base salary limits on matching under our 401(k) plan and contributions to our defined benefit pension plan. The value of the contributions is 11% for all base salary compensation in excess of the IRS limits.
From time to time, the Company provides other benefits to our executives that are intended for business purposes, including tax equalization payments, limited personal use of private aircraft or accompanying spouse travel, relocation benefits, and the payment of business club memberships or dues.
Tax equalization payments are designed to make executives whole if they incur income tax in jurisdictions other than their country and/or state of residence. For example, executives may travel to other jurisdictions on Company business and may be taxed based on days worked in those jurisdictions. If, and only to the extent, those additional taxes cannot be offset against the executive’s regular income tax liability (such as in the form of credits), the Company will reimburse an amount sufficient to make the executive’s tax liability equal to the full income tax for his jurisdiction of residence only.
| 2024Proxy Statement | LyondellBasell | 62 |
The Company has agreements with Flexjet, LLC for a fractional ownership interest in and use of private aircraft. The primary use of the Flexjet aircraft is for business purposes, with limited personal use when adjacent to business purposes. From time to time, spouses, family members or personal guests may accompany our executive officers on Flexjet aircraft. The Company may also pay or reimburse the cost of occasional spouse travel related to business trips. When approved travel of a family member or guest is imputed as income to the executive officer, we reimburse the additional income tax incurred.incurred, as applicable. During 2022,2023, Mr. Vanacker and Mr. Lane had flights that were considered taxable. The imputed income will be reported and taxed in 20232024 with no tax reimbursements for these specific flights.
Section 162(m) of the U.S. Internal Revenue Code limits the deductibility of compensation paid to certain executives, including our CEO, CFO, and our three other most highly compensated officers, to $1 million annually. Historically, the deduction limit did not apply to certain performance-based compensation, and we took Section 162(m) and the deductibility of compensation, among other factors, into consideration in structuring our annual bonuses and certain long-term incentive awards.
The C&TD Committee will continue to consider tax implications (including the lack of deductibility under section 162(m)) among other relevant factors in designing and implementing our executive compensation programs. We will continue to monitor taxation, applicable incentives, standard practice in our industry, and other factors and adjust our executive compensation programs as needed.
| 2024Proxy Statement | LyondellBasell | 63 |
The Compensation and Talent Development Committee has reviewed and discussed the Compensation Discussion and Analysis with management, and based on such review and discussions, recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.
The Compensation and Talent Development Committee
Nance Dicciani,
Albert Manifold, ChairTonyAnthony ChaseMichael HanleyRita Griffin
Virginia Kamsky
Albert Manifold
| 2024Proxy Statement | LyondellBasell | 64 |
LYONDELLBASELL 2023 PROXY STATEMENT 59
The following table sets forth information with respect to the compensation of our NEOs for the years ended December 31, 2022, 2021, and 2020.
Name and Principal Position | Year | Salary(2) ($) | Bonus(3) ($) | Stock Awards(4) ($) | Option Awards(5) ($) | Non-Equity Incentive Plan Compensation(6) ($) | Change in Pension Value(7) ($) | All Other Compensation(8)(9) ($) | Total(8) ($) |
Peter Vanacker(1) Chief Executive Officer | 2022 | 861,538 | 1,900,000 | 9,676,036 | 2,500,004 | 1,398,485 | 13,547 | 669,379 | 17,018,989 |
Ken Lane(2) Interim CEO and Executive Vice President Global Olefins & Polyolefins and Procurement | 2022 | 968,825 | — | 3,582,510 | 717,419 | 3,389,488 | 11,365 | 128,469 | 8,798,076 |
2021 | 787,503 | — | 1,841,166 | 622,124 | 1,262,839 | 13,734 | 88,429 | 4,615,795 | |
2020 | 794,077 | — | 1,443,789 | 481,253 | 482,828 | 13,062 | 87,098 | 3,302,107 | |
Michael McMurray Executive Vice President and Chief Financial Officer | 2022 | 824,000 | — | 2,050,443 | 721,022 | 2,409,387 | 12,936 | 91,685 | 6,109,473 |
2021 | 818,185 | — | 2,186,241 | 738,700 | 1,312,040 | 13,936 | 86,092 | 5,155,194 | |
2020 | 830,769 | — | 1,860,122 | 620,004 | 498,960 | 13,218 | 86,039 | 3,909,112 | |
Jim Guilfoyle Senior Vice President Olefins & Polyolefins EAMEI | 2022 | 770,183 | — | 1,691,684 | 594,846 | 2,817,421 | — | 89,244 | 5,963,378 |
2021 | 671,408 | — | 1,625,037 | 549,087 | 1,075,996 | 17,959 | 76,292 | 4,015,779 | |
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Jeffrey Kaplan Executive Vice President and General Counsel | 2022 | 710,831 | — | 1,476,315 | 519,120 | 2,284,481 | 6,156 | 94,115 | 5,091,018 |
2021 | 688,215 | — | 1,555,813 | 525,706 | 1,042,259 | 16,664 | 77,980 | 3,906,637 | |
2020 | 683,792 | — | 1,200,657 | 400,209 | 406,696 | 16,089 | 77,007 | 2,784,450 | |
Torkel Rhenman Executive Vice President Advanced Polymer Solutions | 2022 | 793,100 | — | 1,691,684 | 594,846 | 2,923,912 | 13,734 | 94,791 | 6,112,067 |
2021 | 787,503 | — | 1,841,166 | 622,124 | 1,262,839 | 14,399 | 88,125 | 4,616,156 | |
2020 | 794,077 | — | 1,559,312 | 519,757 | 511,229 | 13,652 | 86,098 | 3,484,125 | |
(1) Mr. Vanacker assumed his position as CEO effective May 23, 2022. (2) From January 1, 2022 to May 22, 2022, Mr. Lane served as Interim CEO and his base salary was $1,200.000. From May 23, 2022 to September 30, 2022, his base salary was $793,100. From October 1, 2022 to December 31, 2022, his base salary was $870,000. (3) Represents a cash sign-on bonus paid in connection with the 2022 appointment of Mr. Vanacker. (4) Stock awards granted to NEOs in 2020, 2021 and 2022 include RSUs and PSUs. The RSUs are granted under the LyondellBasell Industries Long Term Incentive Plan (the “LTIP”) and entitle the recipient to an equal number of shares of the Company’s stock when the RSUs vest on the third anniversary of the date of grant. RSUs receive cash dividend equivalents at the same time dividends are paid on the Company’s stock. Amounts included in the table are the aggregate grant date fair values of the awards calculated in accordance with ASC 718. The PSUs are also granted under the LTIP. The PSUs entitle the recipient to a number of shares of the Company’s common stock equal to the number of units, multiplied by an earned percentage that can range from 0 to 200% of the targeted number of units based on Company performance. The PSUs accrue dividend equivalents during the performance period in the form of additional units. See Note 15 to the Company’s Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Annual Report”) for a discussion of the calculation of the fair value of the awards. There was no payout under the PSUs for the three-year performance periods ended December 31, 2020 and 2021. The PSUs for the three-year performance period ended December 31, 2022 paid out at 100%. Annual grants of RSUs and PSUs are made at the first regularly scheduled C&TD Committee meeting of the calendar year. The following is the aggregate grant date fair value of the PSUs granted in 2022 if we assumed the maximum amounts (200% of target) will be earned: Peter Vanacker - $9,873,449; Ken Lane - $2,720,259; Michael McMurray - $2,733,861; Jim Guilfoyle - $2,255,516; Jeffrey Kaplan - $1,968,357; Torkel Rhenman - $2,255,516. (5) Stock options are also granted under the LTIP and annual awards are made at the first regularly scheduled C&TD Committee meeting of the calendar year. The stock options vest ratably over a three-year period beginning with the first anniversary of the date of grant and expire after ten years. The amounts shown are the fair values of the stock options on the date of grant, in accordance with ASC 718. The fair values of stock options were calculated using the Black-Scholes option-pricing model. We use the Black-Scholes formula to calculate an assumed value of the options for compensation expense purposes; because the formula uses assumptions, the fair values calculated are not necessarily indicative of the actual values of the stock options. The assumptions used for the 2022 annual grants were: a dividend yield of 4%; a risk-free interest rate of 1.913%; an expected life of 5.4 years; and stock price volatility of 39.05% See Note 15 to the Company’s Consolidated Financial Statements in the 2022 Annual Report for a discussion of the calculation of the fair value of the awards. | |||||||||
LYONDELLBASELL 2023, PROXY STATEMENT 60
Amounts of Non-Equity Incentive Plan Compensation in 2022 include the annual bonuses paid out in March 2023 for performance during 2022, and one-time cash retention awards, which vested on December 30, 2022, granted in connection with the retirement of our former CEO in 2021 to Ken Lane — $2,000,000; Michael McMurray — $1,500,000, Jim Guilfoyle — $2,000,000; Jeffrey Kaplan — $1,500,000; and Torkel Rhenman — $2,000,000.2021.
Amounts include increases during 2022 in the actuarial present values of benefits under the LyondellBasell Retirement Plan. The increases are calculated based on the difference between the total benefit actuarially reduced from age 65 to current age and the present value of the benefits under the plan. For Mr. Guilfoyle, the change in his 2021 pension value reflects a correction for additional pension credits that were accidentally omitted from last year’s calculations. In addition, Mr. Guilfoyle's 2022 pension value was negative due to a significant increase in discount rate during 2022. See the “Pension Benefits” table on page 67 for more information.
Due to an administrative error, the amounts previously reported as “All Other Compensation” for Messrs. Lane, McMurray, Guilfoyle, Kaplan and Rhenman during 2021 and 2020 incorrectly included pension contributions already accounted for within the “Change in Pension Value” column; the corrected values for 2021 and 2020 are reflected in the Summary Compensation Table above.
Amounts included in “All Other Compensation” for 2022 in the table above include the following (amounts in dollars):
| Name and Principal Position | Year | Salary(2) ($) | Bonus(3) ($) | Stock Awards(4) ($) | Option Awards(5) ($) | Non-Equity Incentive Plan Compensation(6) ($) | Change in Pension Value(7) ($) | All Other Compensation(8) ($) | Total ($) | |||||||||
Peter Vanacker(1) Chief Executive Officer | 2023 | 1,437,500 | — | 8,978,151 | 2,664,298 | 2,946,400 | 16,479 | 503,366 | 16,546,194 | |||||||||
| 2022 | 861,538 | 1,900,000 | 9,676,036 | 2,500,004 | 1,398,485 | 13,547 | 669,379 | 17,018,989 | ||||||||||
Michael McMurray Executive Vice President and Chief Financial Officer | 2023 | 843,500 | — | 2,775,140 | 823,520 | 1,132,519 | 19,924 | 102,024 | 5,696,627 | |||||||||
| 2022 | 824,000 | — | 2,050,443 | 721,022 | 2,409,387 | 12,936 | 91,685 | 6,109,473 | ||||||||||
| 2021 | 818,185 | — | 2,186,241 | 738,700 | 1,312,040 | 13,936 | 86,092 | 5,155,194 | ||||||||||
Ken Lane(2) Executive Vice President Global Olefins & Polyolefins and Procurement | 2023 | 870,000 | — | 2,201,335 | 653,260 | 1,097,179 | 20,675 | 603,110 | 5,445,559 | |||||||||
| 2022 | 968,825 | — | 3,582,510 | 717,419 | 3,389,488 | 11,365 | 128,469 | 8,798,076 | ||||||||||
| 2021 | 787,503 | — | 1,841,166 | 622,124 | 1,262,839 | 13,734 | 88,429 | 4,615,795 | ||||||||||
Jim Guilfoyle Senior Vice President Olefins & Polyolefins EAMEI | 2023 | 793,562 | — | 1,942,151 | 576,288 | 916,566 | 46,611 | 824,643 | 5,099,821 | |||||||||
| 2022 | 770,183 | — | 1,691,684 | 594,846 | 2,817,421 | — | 89,244 | 5,963,378 | ||||||||||
| 2021 | 671,408 | — | 1,625,037 | 549,087 | 1,075,996 | 17,959 | 76,292 | 4,015,779 | ||||||||||
Torkel Rhenman Executive Vice President Advanced Polymer Solutions | 2023 | 798,275 | — | 2,024,259 | 600,685 | 894,900 | 20,740 | 91,436 | 4,430,295 | |||||||||
| 2022 | 793,100 | — | 1,691,684 | 594,846 | 2,923,912 | 13,734 | 94,791 | 6,112,067 | ||||||||||
| 2021 | 787,503 | — | 1,841,166 | 622,124 | 1,262,839 | 14,399 | 88,125 | 4,616,156 |
| (1) | Mr. Vanacker assumed his position as CEO effective May 23, 2022. |
| (2) | From January 1, 2022 to May 22, 2022, Mr. Lane served as Interim CEO and his base salary was $1,200,000. From May 23, 2022 to September 30, 2022, his base salary was $793,100. From October 1, 2022 to December 31, 2022, his base salary was $870,000. Mr. Lane resigned from his position effective March 15, 2024. As a result of his departure, unvested RSUs, PSUs and options as of such date granted to Mr. Lane were forfeited, resulting in the forfeiture of 27,949 RSUs, 28,233 PSUs, and option awards representing 26,999 shares of common stock. The forfeiture of these awards is not reflected in the “Stock Awards” and “Option Awards” columns above, which are based on the aggregate grant date fair value of the full awards, as further detailed in footnotes (4) and (5) below. |
| (3) | Represents a cash sign-on bonus paid in connection with the 2022 appointment of Mr. Vanacker. |
| 2024Proxy Statement | LyondellBasell | 65 |
Name | Matching 401(k) Contributions(a) ($) | Matching ($) | Relocation ($) | Personal Use of Aircraft(c) ($) | Other(d) ($) | Total ($) |
Peter Vanacker(e) | 18,300 | 61,219 | 516,997 | 50,969 | 21,894 | 669,379 |
Ken Lane | 18,300 | 73,021 | — | 18,496 | 18,652 | 128,469 |
Michael McMurray | 18,300 | 57,090 | — | — | 16,295 | 91,685 |
Jim Guilfoyle | 18,300 | 51,170 | — | — | 19,774 | 89,244 |
Jeffrey Kaplan | 18,300 | 44,641 | — | — | 31,174 | 94,115 |
Torkel Rhenman | 18,300 | 53,691 | — | — | 22,800 | 94,791 |
(a) Includes Company matching contributions to each NEO’s 401(k). (b) Includes Company contributions under the Company’s U.S. Senior Management Deferral Plan. See the “Non-Qualified Deferred Compensation in 2022” table on page 67 for more information. (c) Represents the approximate incremental cost to the Company for the personal use of Company aircraft by the NEO’s spouse or personal guest in 2022 or the payment or reimbursement of commercial spouse travel related to business trips, as well as reimbursement of additional income tax incurred by the NEO when the cost of such travel is imputed as income. Approximate incremental cost for travel on Company aircraft has been determined based on the total trip charge for each flight segment divided by the total number of passengers traveling on that segment. (d) Includes executive physicals; payment of professional fees for tax filings; financial planning allowances; and matching charitable contributions. For Mr. Vanacker, also includes business continuity costs associated with installation of a home generator. None of these amounts individually exceeded the greater of $25,000 or 10% of the total amount of other compensation for the executive in 2022. (e) In connection with Mr. Vanacker’s appointment as Chief Executive Officer, the Company and Mr. Vanacker entered into an offer letter, which provides that Mr. Vanacker is eligible to participate in the benefit programs generally available to senior executives of the Company. | ||||||
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| (4) | Stock awards granted to NEOs in 2021, 2022, and 2023 include RSUs and PSUs. The RSUs are granted under the LyondellBasell Industries Long Term Incentive Plan (the “LTIP”) and entitle the recipient to an equal number of shares of the Company’s stock when the RSUs vest on the third anniversary of the date of grant. RSUs receive cash dividend equivalents at the same time dividends are paid on the Company’s stock. Amounts included in the table are the aggregate grant date fair values of the awards calculated in accordance with ASC 718. The PSUs are also granted under the LTIP. The PSUs entitle the recipient to a number of shares of the Company’s common stock equal to the number of units, multiplied by an earned percentage that can range from 0 to 200% of the targeted number of units based on Company performance. The PSUs accrue dividend equivalents during the performance period in the form of additional units. See Note 16 to the Company’s Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Annual Report”) for a discussion of the calculation of the fair value of the awards. There was no payout under the PSUs for the three-year performance period ended December 31, 2021. The PSUs for the three-year performance periods ended December 31, 2022 and December 31, 2023 paid out at 100% and 200%, respectively. Annual grants of RSUs and PSUs are made at the first regularly scheduled C&TD Committee meeting of the calendar year. The following is the aggregate grant date fair value of the PSUs granted in 2023 if we assumed the maximum amounts (200% of target) will be earned: Peter Vanacker - $8,978,151; Michael McMurray - $2,775,140; Ken Lane - $2,201,335; Jim Guilfoyle - $1,942,151; Torkel Rhenman - $2,024,259. |
| (5) | Stock options are also granted under the LTIP and annual awards are made at the first regularly scheduled C&TD Committee meeting of the calendar year. The stock options vest ratably over a three-year period beginning with the first anniversary of the date of grant and expire after ten years. The amounts shown are the fair values of the stock options on the date of grant, in accordance with ASC 718. The fair values of stock options were calculated using the Black-Scholes option-pricing model. We use the Black-Scholes formula to calculate an assumed value of the options for compensation expense purposes; because the formula uses assumptions, the fair values calculated are not necessarily indicative of the actual values of the stock options. The assumptions used for the 2023 annual grants were: a dividend yield of 5%; a risk-free interest rate of 4.066%; an expected life of 5.7 years; and stock price volatility of 39.91%. See Note 16 to the Company’s Consolidated Financial Statements in the 2023 Annual Report for a discussion of the calculation of the fair value of the awards. |
| (6) | Amounts of Non-Equity Incentive Plan Compensation in 2023 include the annual bonuses paid out in March 2024 for performance during 2023. |
| (7) | Amounts include increases during 2023 in the actuarial present values of benefits under the LyondellBasell Retirement Plan. The increases are calculated based on the difference between the total benefit actuarially reduced from age 65 to current age and the present value of the benefits under the plan. Mr. Guilfoyle’s 2022 pension value was negative due to a significant increase in discount rate during 2022. See the “Pension Benefits” table on page 72 for more information. |
| (8) | Amounts included in “All Other Compensation” for 2023 in the table above include the following (amounts in dollars): |
| Name | Matching 401(k) Contributions(a) ($) | Matching Deferral Plan Contributions(b) ($) | Relocation(c) ($) | Personal Use of Aircraft(d) ($) | Other(e) ($) | Total ($) | |||||||
| Peter Vanacker | 19,800 | 121,825 | 208,069 | 108,502 | 45,170 | 503,366 | |||||||
| Michael McMurray | 19,800 | 56,485 | — | — | 25,739 | 102,024 | |||||||
| Ken Lane | 19,800 | 59,400 | — | 8,605 | 515,305 | 603,110 | |||||||
| Jim Guilfoyle | 19,800 | 50,992 | 110,587 | — | 643,264 | 824,643 | |||||||
| Torkel Rhenman | 19,800 | 51,510 | — | — | 20,126 | 91,436 |
| (a) | Includes Company matching contributions to each NEO’s 401(k). | |
| (b) | Includes Company contributions under the Company’s U.S. Senior Management Deferral Plan. See the “Non-Qualified Deferred Compensation in 2023” table on page Non-Qualified Deferred Compensation in 2023 for more information. | |
| (c) | Represents relocation benefits provided to Mr. Vanacker and Mr. Guilfoyle. | |
| (d) | Represents the approximate incremental cost to the Company for the personal use of Company aircraft by the NEO’s spouse or personal guest in 2023 or the payment or reimbursement of commercial spouse travel related to business trips, as well as reimbursement of additional income tax incurred by the NEO when the cost of such travel is imputed as income. Approximate incremental cost for travel on Company aircraft has been determined based on the total trip charge for each flight segment divided by the total number of passengers traveling on that segment. | |
| (e) | For Mr. Guilfoyle, includes $632,000 in expatriation allowances and tax gross ups. For Mr. Lane, includes $500,000 in charitable contributions that were made by the Company on behalf of Mr. Lane. For the other NEOs, includes executive physicals; payment of professional fees for tax filings; financial planning allowances; and matching charitable contributions. None of these amounts individually exceeded the greater of $25,000 or 10% of the total amount of other compensation for the NEO in 2023. |
| 2024Proxy Statement | LyondellBasell | 66 |
LYONDELLBASELL 2023 PROXY STATEMENT 61
| Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(2) | Estimated Future Payouts Under Equity Incentive Plan Awards(3) | All Other Stock Awards: Number of Shares of | All Other Option Awards: Number of Securities | Exercise or Base Price of Option | Grant Date Fair Value of Stock and Option | |||||||||||||
| Name | Grant Date(1) | Target ($) | Max. ($) | Target (#) | Max. (#) | Stock or Units(4) | Underlying Options(5) | Awards(5) ($) | Awards ($) | |||||||||
| Peter Vanacker | 2/23/2023 | 2,320,000 | 4,640,000 | — | — | — | — | — | — | |||||||||
| 2/23/2023 | — | — | 56,422 | 112,844 | — | — | — | 6,307,980 | ||||||||||
| 2/23/2023 | — | — | — | — | 28,211 | — | — | 2,670,171 | ||||||||||
| 2/23/2023 | — | — | — | — | — | 107,129 | 94.65 | 2,664,298 | ||||||||||
| Michael McMurray | 2/23/2023 | 807,500 | 1,615,000 | — | — | — | — | — | — | |||||||||
| 2/23/2023 | — | — | 17,440 | 34,880 | — | — | — | 1,949,792 | ||||||||||
| 2/23/2023 | — | — | — | — | 8,720 | — | — | 825,348 | ||||||||||
| 2/23/2023 | — | — | — | — | — | 33,113 | 94.65 | 823,520 | ||||||||||
| Ken Lane(6) | 2/23/2023 | 826,500 | 1,653,000 | — | — | — | — | — | — | |||||||||
| 2/23/2023 | — | — | 13,834 | 27,668 | — | — | — | 1,546,641 | ||||||||||
| 2/23/2023 | — | — | — | — | 6,917 | — | — | 654,694 | ||||||||||
| 2/23/2023 | — | — | — | — | — | 26,267 | 94.65 | 653,260 | ||||||||||
| Jim Guilfoyle | 2/23/2023 | 753,445 | 1,506,890 | — | — | — | — | — | — | |||||||||
| 2/23/2023 | — | — | 12,205 | 24,410 | — | — | — | 1,364,502 | ||||||||||
| 2/23/2023 | — | — | — | — | 6,103 | — | — | 577,649 | ||||||||||
| 2/23/2023 | — | — | — | — | — | 23,172 | 94.65 | 576,288 | ||||||||||
| Torkel Rhenman | 2/23/2023 | 760,000 | 1,520,000 | — | — | — | — | — | — | |||||||||
| 2/23/2023 | — | — | 12,721 | 25,442 | — | — | — | 1,422,190 | ||||||||||
| 2/23/2023 | — | — | — | — | 6,361 | — | — | 602,069 | ||||||||||
| 2/23/2023 | — | — | — | — | — | 24,153 | 94.65 | 600,685 | ||||||||||
| (1) | The grant date of February 23, 2023 is the date of the first regularly-scheduled Board meeting that follows the first regularly-scheduled C&TD Committee meeting of the calendar year when annual grants are made. |
| (2) | The awards shown are the estimated possible payouts of the NEOs’ annual bonus payments for performance in 2023. Actual bonus (STI) payments for 2023 are shown in the Summary Compensation Table under the column “Non-Equity Incentive Plan Compensation.” The NEOs’ target bonuses are a percentage of base salary. The maximum shown in the table is the maximum amount that can be earned under the terms of the STI plan, which is 200% of target. Each performance measure is assessed and weighted, and payments can range from 0 — 200% of target. |
| (3) | These awards represent PSUs granted in 2023, which are earned over a three-year performance period ending December 31, 2025, with payouts, if any, in the first quarter of 2026. The performance criterion for the PSUs is assessed, and payments can range from 0 — 200% of the target award, which is settled in shares. These awards accrue dividend equivalents during the performance period in the form of additional units. |
| (4) | These awards represent RSUs awarded on February 23, 2023, which will cliff vest at the end of three years from the grant date. RSU holders are entitled to receive cash dividend equivalents. |
| (5) | These awards represent annual stock option grants. The exercise price of the options is equal to the fair market value on the date of grant. All stock options included in the table vest in equal increments over a three-year period beginning on the first anniversary of the date of grant and expire ten years after the date of grant. |
| (6) | Mr. Lane resigned from his position effective March 15, 2024, and his unvested PSUs, RSUs, and stock options on such date were forfeited on the terms described under “Potential Payments Upon Termination or Change in Control.” |
| 2024Proxy Statement | LyondellBasell | 67 |
Name | Grant Date(1) | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(2) |
| Estimated Future Payouts Under Equity Incentive Plan Awards(3) | All Other Stock Awards: Number of Shares of Stock or Units(4) | All Other Option Awards: Number of Securities Underlying Options(5) | Exercise or Base Price of Option Awards(5) ($) | Grant Date Fair Value of Stock and Option Awards ($) | ||
Target ($) | Max. ($) | Target (#) | Max. (#) | |||||||
Peter Vanacker | 05/23/2022 | 1,292,308 | 2,584,615 |
| — | — | — | — | — | — |
05/23/2022 | — | — |
| 46,263 | 92,526 | — | — | — | 4,936,725 | |
05/23/2022 | — | — |
| — | — | 44,413 | — | — | 4,739,311 | |
05/23/2022 | — | — |
| — | — | — | 96,191 | 101.51 | 2,500,004 | |
Ken Lane | 02/24/2022 | 1,174,230 | 2,348,460 |
| — | — | — | — | — | — |
02/24/2022 | — | — |
| 14,399 | 28,798 | — | — | — | 1,360,130 | |
02/24/2022 | — | — |
| — | — | 7,200 | — | — | 680,112 | |
02/24/2022 | — | — |
| — | — | — | 28,469 | 89.26 | 717,419 | |
05/26/2022 | — | — |
| — | — | 13,832 | — | — | 1,542,268 | |
Michael McMurray | 02/24/2022 | 741,600 | 1,483,200 |
| — | — | — | — | — | — |
02/24/2022 | — | — |
| 14,471 | 28,942 | — | — | — | 1,366,930 | |
02/24/2022 | — | — |
| — | — | 7,236 | — | — | 683,513 | |
02/24/2022 | — | — |
| — | — | — | 28,612 | 89.26 | 721,022 | |
Jim Guilfoyle | 02/24/2022 | 731,674 | 1,463,348 |
| — | — | — | — | — | — |
02/24/2022 | — | — |
| 11,939 | 23,878 | — | — | — | 1,127,758 | |
02/24/2022 |
|
|
| — | — | 5,970 | — | — | 563,926 | |
02/24/2022 | — | — |
| — | — | — | 23,605 | 89.26 | 594,846 | |
Jeffrey Kaplan | 02/24/2022 | 639,748 | 1,279,495 |
| — | — | — | — | — | — |
02/24/2022 | — | — |
| 10,419 | 20,838 | — | — | — | 984,178 | |
02/24/2022 | — | — |
| — | — | 5,210 | — | — | 492,137 | |
02/24/2022 | — | — |
| — | — | — | 20,600 | 89.26 | 519,120 | |
Torkel Rhenman | 02/24/2022 | 753,445 | 1,506,890 |
| — | — | — | — | — | — |
02/24/2022 | — | — |
| 11,939 | 23,878 | — | — | — | 1,127,758 | |
02/24/2022 | — | — |
| — | — | 5,970 | — | — | 563,926 | |
02/24/2022 | — | — |
| — | — | — | 23,605 | 89.26 | 594,846 | |
(1) The grant date of February 24, 2022 is the date of the first regularly-scheduled Board meeting that follows the first regularly-scheduled C&TD Committee meeting of the calendar year when annual grants are made. On May 23, 2022, the C&TD Committee approved awards to Peter Vanacker in connection with his appointment as CEO. On May 26, 2022, the C&TD Committee approved awards to Ken Lane in recognition of his service as interim CEO. (2) The awards shown are the estimated possible payouts of the NEOs’ annual bonus payments for performance in 2022. Actual bonus (STI) payments for 2022 are shown in the Summary Compensation Table under the column “Non-Equity Incentive Plan Compensation.” The NEOs’ target bonuses are a percentage of base salary. The maximum shown in the table is the maximum amount that can be earned under the terms of the STI plan, which is 200% of target. Each performance measure is assessed and weighted, and payments can range from 0 — 200% of target. (3) Represents PSUs. These awards, granted in 2022, are earned over a three-year performance period ending December 31, 2024, with payouts, if any, in the first quarter of 2025. The performance criterion for the PSUs is assessed, and payments can range from 0 — 200% of the target award, to be settled in shares. These awards accrue dividend equivalents during the performance period in the form of additional units. (4) Represents RSUs. These awards made on February 24, 2022 will vest three years from the grant date. RSUs receive cash dividend equivalents. On May 26, 2022, the C&TD Committee approved RSU awards to Ken Lane, which will vest two years from the grant date. (5) Represents annual stock option grants. The exercise price of all options is equal to the fair market value on the date of grant, adjusted for the special dividend issued by the Company in June 2022. All stock options included in the table vest in equal increments over a three-year period beginning on the first anniversary of the date of grant and expire ten years after the date of grant. | ||||||||||
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Name | Option Awards |
| Stock Awards | ||||||
Number of Securities Underlying Unexercised Options Exercisable | Number of Securities Underlying Unexercised Options Unexercisable(1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested(2) | Market Value of Shares or Units of Stock That Have Not Vested(3) ($) | Equity Incentive Plan Awards | |||
Number of Unearned Shares, Units, or Other Rights That Have Not Vested(4) | Market or Payout Value of Unearned Shares, Units, or Other Rights That Have Not Vested(3) ($) | ||||||||
Peter Vanacker | — | 96,191 | 101.51 | 05/23/2032 |
| 44,413 | 3,687,611 | 46,263 | 3,841,217 |
Ken Lane | 4,782 | — | 80.68 | 07/15/2029 |
| 32,684 | 2,713,753 | 26,155 | 2,171,650 |
— | 13,149 | 78.15 | 02/20/2030 |
| — | — | — | — | |
10,237 | 20,470 | 99.21 | 02/25/2031 |
| — | — | — | — | |
— | 28,469 | 89.26 | 02/24/2032 |
| — | — | — | — | |
Michael McMurray | 103,306 | — | 92.17 | 11/05/2029 |
| 21,655 | 1,798,015 | 28,430 | 2,360,543 |
— | 16,940 | 78.15 | 02/20/2030 |
| — | — | — | — | |
12,155 | 24,306 | 99.21 | 02/25/2031 |
| — | — | — | — | |
— | 28,612 | 89.26 | 02/24/2032 |
| — | — | — | — | |
Jim Guilfoyle | 1,205 | — | 84.74 | 02/17/2025 |
| 15,523 | 1,288,875 | 22,315 | 1,852,814 |
347 | — | 96.23 | 06/01/2025 |
| — | — | — | — | |
5,667 | — | 72.73 | 02/16/2026 |
| — | — | — | — | |
9,148 | — | 87.49 | 02/16/2027 |
| — | — | — | — | |
11,651 | — | 103.89 | 02/21/2028 |
| — | — | — | — | |
18,867 | — | 83.30 | 02/21/2029 |
| — | — | — | — | |
19,878 | 9,938 | 78.15 | 02/20/2030 |
| — | — | — | — | |
9,034 | 18,068 | 99.21 | 02/25/2031 |
| — | — | — | — | |
— | 23,605 | 89.26 | 02/24/2032 |
| — | — | — | — | |
Jeffrey Kaplan | 2,857 | — | 96.59 | 05/07/2025 |
| 14,979 | 1,243,706 | 20,353 | 1,689,910 |
14,304 | — | 87.49 | 02/16/2027 |
| — | — | — | — | |
16,396 | — | 103.89 | 02/21/2028 |
| — | — | — | — | |
— | 10,934 | 78.15 | 02/20/2030 |
| — | — | — | — | |
8,650 | 17,298 | 99.21 | 02/25/2031 |
| — | — | — | — | |
— | 20,600 | 89.26 | 02/24/2032 |
| — | — | — | — | |
Torkel Rhenman | 10,666 | — | 80.68 | 07/15/2029 |
| 18,084 | 1,501,515 | 23,695 | 1,967,396 |
24,201 | 14,201 | 78.15 | 02/20/2030 |
| — | — | — | — | |
10,237 | 20,470 | 99.21 | 02/25/2031 |
| — | — | — | — | |
— | 23,605 | 89.26 | 02/24/2032 |
| — | — | — | — | |
LYONDELLBASELL 2023 PROXY STATEMENT 63
| Option Awards | Stock Awards | |||||||||||||||
| Equity Incentive Plan Awards | ||||||||||||||||
| Name | Number of Securities Underlying Unexercised Options Exercisable | Number of Securities Underlying Unexercised Options Unexercisable(1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested(2) | Market Value of Shares or Units of Stock That Have Not Vested(3) ($) | Number of Unearned Shares, Units, or Other Rights That Have Not Vested(4) | Market or Payout Value of Unearned Shares, Units, or Other Rights That Have Not Vested(3) ($) | ||||||||
| Peter Vanacker | 32,065 | 64,126 | 101.51 | 5/23/2032 | 61,983 | 5,893,344 | 102,685 | 9,763,290 | ||||||||
| — | 107,129 | 94.65 | 2/23/2033 | — | — | — | — | |||||||||
| Michael McMurray | 103,306 | — | 92.17 | 11/5/2029 | 22,936 | 2,180,755 | 31,911 | 3,034,098 | ||||||||
| 16,940 | — | 78.15 | 2/20/2030 | — | — | — | — | |||||||||
| 24,308 | 12,153 | 99.21 | 2/25/2031 | — | — | — | — | |||||||||
| 9,538 | 19,074 | 89.26 | 2/24/2032 | — | — | — | — | |||||||||
| — | 33,113 | 94.65 | 2/23/2033 | — | — | — | — | |||||||||
| Ken Lane | 20,472 | 10,235 | 99.21 | 2/25/2031 | 33,827 | 3,216,271 | 28,233 | 2,684,394 | ||||||||
| — | 18,978 | 89.26 | 2/24/2032 | — | — | — | — | |||||||||
| — | 26,267 | 94.65 | 2/23/2033 | — | — | — | — | |||||||||
| Jim Guilfoyle | 1,205 | — | 84.74 | 2/17/2025 | 17,261 | 1,641,176 | 24,144 | 2,295,612 | ||||||||
| 347 | — | 96.23 | 6/1/2025 | — | — | — | — | |||||||||
| 9,148 | — | 87.49 | 2/16/2027 | — | — | — | — | |||||||||
| 11,651 | — | 103.89 | 2/21/2028 | — | — | — | — | |||||||||
| 18,867 | — | 83.30 | 2/21/2029 | — | — | — | — | |||||||||
| 29,816 | — | 78.15 | 2/20/2030 | — | — | — | — | |||||||||
| 18,068 | 9,034 | 99.21 | 2/25/2031 | — | — | — | — | |||||||||
| 7,869 | 15,736 | 89.26 | 2/24/2032 | — | — | — | — | |||||||||
| — | 23,172 | 94.65 | 2/23/2033 | — | — | — | — | |||||||||
| Torkel Rhenman | 10,666 | — | 80.68 | 7/15/2029 | 18,209 | 1,731,312 | 24,660 | 2,344,673 | ||||||||
| 38,402 | — | 78.15 | 2/20/2030 | — | — | — | — | |||||||||
| 20,472 | 10,235 | 99.21 | 2/25/2031 | — | — | — | — | |||||||||
| 7,869 | 15,736 | 89.26 | 2/24/2032 | — | — | — | — | |||||||||
| — | 24,153 | 94.65 | 2/23/2033 | — | — | — | — | |||||||||
| 2024Proxy Statement | LyondellBasell | 68 |
| (1) | The vesting schedules of the unexercisable stock options are shown below: |
| Name | Total Unvested Stock Options | Exercise Price(a) ($) | 2024 Vesting Details | 2025 Vesting Details | 2026 Vesting Details | |||||
| Peter Vanacker | 64,126 | 101.51 | 32,063 vesting on May 23, 2024 | 32,063 vesting on May 23, 2025 | ||||||
| 107,129 | 94.65 | 35,711 vesting on February 23, 2024 | 35,709 vesting on February 23, 2025 | 35,709 vesting on February 23, 2026 | ||||||
| Michael McMurray | 12,153 | 99.21 | 12,153 vesting on February 25,2024 | |||||||
| 19,074 | 89.26 | 9,537 vesting on February 24, 2024 | 9,537 vesting on February 24, 2025 | |||||||
| 33,113 | 94.65 | 11,039 vesting on February 23, 2024 | 11,037 vesting on February 23, 2025 | 11,037 vesting on February 23, 2026 | ||||||
| Ken Lane(b) | 10,235 | 99.21 | 10,235 vesting on February 25, 2024 | |||||||
| 18,978 | 89.26 | 9,489 vesting on February 24, 2024 | 9,489 vesting on February 24, 2025 | |||||||
| 26,267 | 94.65 | 8,757 vesting on February 23, 2024 | 8,755 vesting on February 23, 2025 | 8,755 vesting on February 23, 2026 | ||||||
| Jim Guilfoyle | 9,034 | 99.21 | 9,034 vesting on February 25, 2024 | |||||||
| 15,736 | 89.26 | 7,868 vesting on February 24, 2024 | 7,868 vesting on February 24, 2025 | |||||||
| 23,172 | 94.65 | 7,724 vesting on February 23, 2024 | 7,724 vesting on February 23, 2025 | 7,724 vesting on February 23, 2026 | ||||||
| Torkel Rhenman | 10,235 | 99.21 | 10,235 vesting on February 25, 2024 | |||||||
| 15,736 | 89.26 | 7,868 vesting on February 24, 2024 | 7,868 vesting on February 24, 2025 | |||||||
| 24,153 | 94.65 | 8,051 vesting on February 23, 2024 | 8,051 vesting on February 23, 2025 | 8,051 vesting on February 23, 2026 |
| (a) | The exercise price of all options is equal to the fair market value on the date of grant. The fair market value of all outstanding vested and unvested stock options as of June 13, 2022 was adjusted as a result of the special dividend paid in 2022. All stock options included in the table vest in three increments over a three-year period beginning on the first anniversary of the date of grant and expire ten years after the date of grant. | |
| (b) | Mr. Lane resigned from his position effective March 15, 2024, and his unvested stock options on such date were forfeited on the terms described under “Potential Payments Upon Termination or Change in Control.” Mr. Lane’s previously vested options may be exercised for 90 days after termination of employment. |
| 2024Proxy Statement | LyondellBasell | 69 |
Name | Total Unvested Stock Options | Exercise Price(a) ($) | 2023 Vesting Details | 2024 Vesting Details | 2025 Vesting Details |
Peter Vanacker | 96,191 | 101.51 | 32,065 vesting on May 23, 2023 | 32,063 vesting on | 32,063 vesting on May 23, 2025 |
Ken Lane | 13,149 | 78.15 | 13,149 vesting on February 20, 2023 |
|
|
20,470 | 99.21 | 10,235 vesting on February 25, 2023 | 10,235 vesting on February 25, 2024 |
| |
28,469 | 89.26 | 9,491 vesting on February 24, 2023 | 9,489 vesting on February 24, 2024 | 9,489 vesting on February 24, 2025 | |
Michael McMurray | 16,940 | 78.15 | 16,940 vesting on February 20, 2023 |
|
|
24,306 | 99.21 | 12,153 vesting on February 25, 2023 | 12,153 vesting on February 25, 2024 |
| |
28,612 | 89.26 | 9,538 vesting on February 24, 2023 | 9,537 vesting on February 25, 2024 | 9,537 vesting on February 25, 2025 | |
Jim Guilfoyle | 9,938 | 78.15 | 9,938 vesting on February 20, 2023 |
|
|
18,068 | 99.21 | 9,034 vesting on February 25, 2023 | 9,034 vesting on February 25, 2024 |
| |
23,605 | 89.26 | 7,869 vesting on February 24, 2023 | 7,868 vesting on February 24, 2024 | 7,868 vesting on February 24, 2025 | |
Jeffrey Kaplan | 10,934 | 78.15 | 10,934 vesting on February 20, 2023 |
|
|
17,298 | 99.21 | 8,649 vesting on February 25, 2023 | 8,649 vesting on February 25, 2024 |
| |
20,600 | 89.26 | 6,868 vesting on February 24, 2023 | 6,866 vesting on February 24, 2024 | 6,866 vesting on February 24, 2025 | |
Torkel Rhenman | 14,201 | 78.15 | 14,201 vesting on February 20, 2023 |
|
|
20,470 | 99.21 | 10,235 vesting on February 25, 2023 | 10,235 vesting on February 25, 2024 |
| |
23,605 | 89.26 | 7,869 vesting on February 24, 2023 | 7,868 vesting on February 24, 2024 | 7,868 vesting on February 24, 2025 |
The exercise price of all options is equal to the fair market value on the date of grant, adjusted for the special dividend issued by the Company in June 2022. All stock options included in the table vest in equal increments over a three-year period beginning on the first anniversary of the date of grant and expire ten years after the date of grant.
LYONDELLBASELL 2023 PROXY STATEMENT 64
| (2) | Includes RSUs for each of the NEOs, the vesting schedules for which are shown below: |
Name | Total Unvested RSUs | Vesting Schedule | ||
Peter Vanacker |
|
| 10,640 vesting on 5/23/2024 | |
| ||||
| 23,132 vesting on 5/23/2025 | ||||
|
|
| 28,211 vesting on 2/ | |
| Michael McMurray | 22,936 | 6,980 vesting on 2/25/2024 | ||
| 7,236 vesting on 2/24/2025 | ||||
| 8,720 vesting on 2/23/2026 | ||||
| Ken Lane(a) | 33,827 | 5,878 vesting on 2/25/2024 | ||
| 13,832 vesting on 5/26/2024 | ||||
| 7,200 vesting on 2/24/2025 | ||||
|
|
| 6,917 vesting on 2/ | |
| ||||
| ||||
Jim Guilfoyle |
|
| ||
| 17,261 | 5,188 vesting on 2/25/2024 | |||
| 5,970 vesting on 2/24/2025 | ||||
|
|
| 6,103 vesting on 2/ | |
| ||||
| ||||
Torkel Rhenman |
|
| ||
| 18,209 | 5,878 vesting on 2/25/2024 | |||
| 5,970 vesting on 2/24/2025 | ||||
| 6,361 vesting on 2/23/2026 |
| (a) | Mr. Lane resigned from his position effective March 15, 2024, and his unvested RSUs on such date were forfeited on the terms described under “Potential Payments Upon Termination or Change in Control.” |
| (3) | Dollar values are based on the closing price of 29, 2023. |
| (4) | Includes PSUs granted in |
| PSUs with Three-Year Performance Period Ending December 31, | ||||
| Name | 2024 | 2025 | ||
| Peter Vanacker | 46,263 | 56,422 | ||
| Michael McMurray | 14,471 | 17,440 | ||
| Ken Lane(a) | 14,399 | 13,834 | ||
| Jim Guilfoyle | 11,939 | 12,205 | ||
| Torkel Rhenman | 11,939 | 12,721 | ||
| (a) | Mr. Lane resigned from his position effective March 15, 2024, and his outstanding PSUs were forfeited on the terms described under “Potential Payments Upon Termination or Change in Control.” |
| 2024Proxy Statement | LyondellBasell | 70 |
| PSUs with Three-Year Performance | |
Name | 2023 | 2024 |
Peter Vanacker | — | 46,263 |
Ken Lane | 11,756 | 14,399 |
Michael McMurray | 13,959 | 14,471 |
Jim Guilfoyle | 10,376 | 11,939 |
Jeffrey Kaplan | 9,934 | 10,419 |
Torkel Rhenman | 11,756 | 11,939 |
LYONDELLBASELL 2023 PROXY STATEMENT 65
| Option Awards | Stock Awards(2) | |||||||||
| Name | Number of Shares Acquired on Exercise | Value Realized on Exercise(1) ($) | Number of Shares Acquired on Vesting | Value Realized on Vesting ($) | ||||||
| Peter Vanacker | — | — | 10,641 | 965,458 | ||||||
| Michael McMurray | — | — | 41,019 | 3,993,984 | ||||||
| Ken Lane | 27,422 | 423,459 | 34,054 | 3,315,832 | ||||||
| Jim Guilfoyle | 5,667 | 133,855 | 29,327 | 2,855,601 | ||||||
| Torkel Rhenman | — | — | 34,516 | 3,360,794 | ||||||
| (1) | The value realized on option exercise represents the difference between the option exercise price and the market price of the LyondellBasell shares when exercised. |
| (2) | Includes RSUs that vested in 2023 and PSUs granted in 2021 with a performance period ended December 31, 2023. The C&TD Committee reviewed the achievement of performance goals for the PSUs granted in 2021, with a performance period ended December 31, 2023 in February 2024 and determined that 200% payout was earned. The number of shares acquired on vesting for both RSUs and PSUs is the gross number of shares for all NEOs, although we withhold shares in payment of minimum statutory withholding taxes when the awards vest. The value realized for RSUs is the number of gross shares vested multiplied by the market price on the date the restrictions lapsed. The value realized for PSUs is the number of gross shares vested multiplied by the market price on the date the C&TD Committee determined the earned percentage of shares for the PSUs. The table below shows the gross number of shares that vested under RSUs and PSUs for each of the NEOs in 2023. |
| Name | RSUs Vested in 2023 | PSUs Earned for Performance Period Ending December 31, 2023 | |||
| Peter Vanacker | 10,641 | — | |||
| Michael McMurray | 7,439 | 33,580 | |||
| Ken Lane | 5,774 | 28,280 | |||
| Jim Guilfoyle | 4,365 | 24,962 | |||
| Torkel Rhenman | 6,236 | 28,280 |
| 2024Proxy Statement | LyondellBasell | 71 |
Name | Option Awards |
| Stock Awards(2) | ||
Number of | Value | Number of Shares Acquired on Vesting | Value | ||
Peter Vanacker | — | — |
| — | — |
Ken Lane | 13,149 | 406,304 |
| 22,196 | 2,024,278 |
Michael McMurray | 33,880 | 1,110,761 |
| 25,903 | 2,371,442 |
Jim Guilfoyle | 1,524 | 59,303 |
| 17,512 | 1,695,537 |
Jeffrey Kaplan | 64,342 | 1,898,337 |
| 16,054 | 1,544,679 |
Torkel Rhenman | — | — |
| 20,502 | 1,892,198 |
(1) The value realized on option exercise represents the difference between the option exercise price and the market price of the LyondellBasell shares when exercised. (2) Includes RSUs that vested in 2022 and PSUs granted in 2020 with a performance period ended December 31, 2022. The C&TD Committee reviewed the achievement of performance goals for the PSUs granted in 2020, with a performance period ended December 31, 2022 in February 2023 and determined that 100% payout was earned. The number of shares acquired on vesting for RSUs is the gross number of shares for all NEOs, although we withhold shares in payment of minimum statutory withholding taxes when the awards vest. The value realized for RSUs is the number of gross shares vested multiplied by the market price on the date the restrictions lapsed. The table below shows the gross number of shares that vested under RSUs and PSUs for each of the NEOs in 2022. | |||||
| Back to Contents |
Name | RSUs Vested in 2022 | PSUs Earned for Performance Period Ending December 31, 2022 |
Peter Vanacker | — | — |
Ken Lane | 8,069 | 14,127 |
Michael McMurray | 7,702 | 18,201 |
Jim Guilfoyle | 6,833 | 10,679 |
Jeffrey Kaplan | 4,306 | 11,748 |
Torkel Rhenman | 5,245 | 15,257 |
LYONDELLBASELL 2023 PROXY STATEMENT 66
Name | Plan Name | Number of Years Credited Service(1) | Present Value of Accumulated Benefit(1) ($) | Payments During Last Fiscal Year ($) |
Peter Vanacker | LyondellBasell Pension Plan | 1 | 13,547 | — |
Ken Lane | LyondellBasell Pension Plan | 3 | 50,566 | — |
Michael McMurray | LyondellBasell Pension Plan | 3 | 44,841 | — |
Jim Guilfoyle | LyondellBasell Pension Plan | 14 | 249,391 | — |
| Equistar Non-Represented | 11 | 147,409 | — |
Millennium Petrochemicals | 5 | 64,014 | — | |
Jeffrey Kaplan | LyondellBasell Pension Plan | 13 | 172,620 | — |
Torkel Rhenman | LyondellBasell Pension Plan | 3 | 54,795 | — |
(1) The amounts shown in the table are the actuarial present value of each participant’s accumulated benefits as of December 31, 2022, calculated on the same basis as used in Note 14 to our Consolidated Financial Statements in the 2022 Annual Report, with the exception that each participant was assumed to continue to be actively employed by us until age 65 (earliest unreduced retirement age) and immediately commence his benefit at that time. | ||||
| Name | Plan Name | Number of Years Credited Service(1) | Present Value of Accumulated Benefit(1) ($) | Payments During Last Fiscal Year ($) | ||||
| Peter Vanacker | LyondellBasell Pension Plan | 2 | 30,026 | — | ||||
| Michael McMurray | LyondellBasell Pension Plan | 4 | 64,765 | — | ||||
| Ken Lane | LyondellBasell Pension Plan | 4 | 71,241 | — | ||||
| Jim Guilfoyle | Cash Balance | 15 | 300,416 | |||||
| Equistar Non-Represented | 11 | 145,333 | — | |||||
| Millennium Petrochemicals | 5 | 61,676 | — | |||||
| Total | 31 | 507,425 | — | |||||
| Torkel Rhenman | LyondellBasell Pension Plan | 4 | 75,535 | — |
| (1) | The amounts shown in the table are the actuarial present value of each participant’s accumulated benefits as of December 31, 2023, calculated on the same basis as used in Note 15 to our Consolidated Financial Statements in the 2023 Annual Report, with the exception that each participant was assumed to continue to be actively employed by us until age 65 (earliest unreduced retirement age) and immediately commence his benefit at that time. |
The LyondellBasell Retirement Plan is a U.S. qualified defined benefit pension plan that provides pension benefits under a cash balance formula that defines participants’ accrued benefits in terms of a notional cash account balance. Eligible employees become participants immediately upon employment and are fully vested upon the earliest of (i) three years of service, (ii) death, or (iii) reaching age 65. The notional account balance for each participant comprises a pay credit of 5% and interest credits, each of which are accumulated at the end of each quarter. Pay credits are based on quarterly base pay, as limited by the Internal Revenue Code, and interest credits are based on the 5th, 4th, and 3rd monthly-determined 30-year treasury rates before the start of that quarter. Benefits under the plan are payable upon separation from the Company.
| 2024Proxy Statement | LyondellBasell | 72 |
| Name | Executive Contributions in Last Fiscal Year(1) ($) | Registrant Contributions in Last Fiscal Year(1)(2) ($) | Aggregate Earnings in Last Fiscal Year(3) ($) | Aggregate Withdrawals/ Distributions(4) ($) | Aggregate Balance at Last Fiscal Year End(5) ($) | |||||
| Peter Vanacker | — | 121,825 | 5,409 | — | 188,453 | |||||
| Michael McMurray | — | 56,485 | 91,411 | — | 515,775 | |||||
| Ken Lane | — | 59,400 | 25,216 | — | 261,294 | |||||
| Jim Guilfoyle | — | 50,992 | 32,908 | — | 295,720 | |||||
| Torkel Rhenman | — | 51,510 | 32,759 | — | 243,327 |
| (1) | The Company maintains a U.S. Senior Management Deferral Plan that allows executives to defer up to 50% of their base salary and up to 100% of their annual bonus and equity grants (“eligible pay”) for payment at a future date. Funds deferred under this plan are allocated into notional accounts that mirror selected investment funds in our 401(k) plans, though the deferred funds are not actually invested and the Company may use separate assets to fund the benefit. |
| (2) | Company contributions to the executives’ Deferral Plan accounts are included in “All Other Compensation,” but not “Salary,” in the Summary Compensation Table. The Deferral Plan provides for Company contributions for that portion of pay that cannot be taken into account for matching contributions or accruals under the Company’s 401(k) plan and defined benefit pension plan due to IRS limits. The eligibility for Company contributions begins in the Deferral Plan once the employee’s salary has reached the IRS limits for those plans; actual contributions by the Company are made as of February 15 of the next calendar year. The Company’s contribution occurs regardless of whether the employee has contributed any amounts under the Deferral Plan or 401(k) plan. Eligible employees must be employed as of February 15 in order to receive the Company contribution. |
| (3) | Earnings on these accounts are not included in any other amounts in the tables included in this proxy statement, as the amounts of the NEOs’ earnings represent the general market gains on investments and are not amounts or rates set by the Company for the benefit of the NEOs. |
| (4) | Accounts are distributed as either a lump sum payment or in annual installments upon the later of (i) the date on which the employee reaches (x) at least 55 years of age and has ten years of service or (y) 65 years of age and (ii) termination of employment. Special circumstances may allow for a modified distribution in the event of the employee’s death, an unforeseen emergency, or upon a change-in-control of the Company. In the event of death, distribution will be made to the designated beneficiary in the form previously elected by the executive. In the event of an unforeseen emergency, the plan administrator may allow an early payment in the amount required to satisfy the emergency. All participants are immediately 100% vested in all of their contributions, Company contributions, and gains and/or losses related to their notional investment choices. |
| (5) | The balance as of the last year includes the Company contributions made in respect of the NEOs’ 2023 earnings, although amounts were not credited to the accounts for continuing NEOs until February 2024. The balance also includes contributions made by the employee as explained in footnote 1 above. |
| 2024Proxy Statement | LyondellBasell | 73 |
Name | Executive Contributions in Last Fiscal Year(1) ($) | Registrant Contributions in Last Fiscal Year(1)(2) ($) | Aggregate Earnings in Last Fiscal Year(3) ($) |
| Aggregate Withdrawals/ Distributions(4) ($) | Aggregate Balance at Last Fiscal Year End(5) ($) |
Peter Vanacker | — | 61,219 | — |
| — | 61,219 |
Ken Lane | — | 73,021 | (19,445 | ) | — | 176,679 |
Michael McMurray | — | 57,090 | (47,972 | ) | — | 367,879 |
Jim Guilfoyle | — | 51,170 | (32,150 | ) | — | 211,820 |
Jeffrey Kaplan | — | 44,641 | (60,054 | ) | — | 337,071 |
Torkel Rhenman | — | 53,691 | (21,646 | ) | — | 159,058 |
(1) The Company maintains a U.S. Senior Management Deferral Plan that allows executives to defer up to 50% of their base salary and up to 100% of their annual bonus and equity grants (“eligible pay”) for payment at a future date. Funds deferred under this plan are allocated into notional accounts that mirror selected investment funds in our 401(k) plans, though the deferred funds are not actually invested and the Company may use separate assets to fund the benefit. (2) Company contributions to the executives’ Deferral Plan accounts are included in “All Other Compensation,” but not “Salary,” in the Summary Compensation Table. The Deferral Plan provides for Company contributions for that portion of pay that cannot be taken into account for matching contributions or accruals under the Company’s 401(k) plan and defined benefit pension plan due to IRS limits. The eligibility for Company contributions begins in the Deferral Plan once the employee’s salary has reached the IRS limits for those plans; actual contributions by the Company are made as of February 15 of the next calendar year. The Company’s contribution occurs regardless of whether the employee has contributed any amounts under the Deferral Plan or 401(k) plan. Eligible employees must be employed as of February 15 in order to receive the Company contribution. (3) Earnings on these accounts are not included in any other amounts in the tables included in this proxy statement, as the amounts of the NEOs’ earnings represent the general market gains on investments and are not amounts or rates set by the Company for the benefit of the NEOs. (4) Accounts are distributed as either a lump sum payment or in annual installments upon the later of (i) the date on which the employee reaches (x) at least 55 years of age and has ten years of service or (y) 65 years of age and (ii) termination of employment. Special circumstances may allow for a modified distribution in the event of the employee’s death, an unforeseen emergency, or upon a change-in-control of the Company. In the event of death, distribution will be made to the designated beneficiary in the form previously elected by the executive. In the event of an unforeseen emergency, the plan administrator may allow an early payment in the amount required to satisfy the emergency. All participants are immediately 100% vested in all of their contributions, Company contributions, and gains and/or losses related to their notional investment choices. (5) The balance as of the last year includes the Company contributions made in respect of the NEOs’ 2022 earnings, although amounts were not credited to the accounts for continuing NEOs until February 2023. | ||||||
LYONDELLBASELL 2023 PROXY STATEMENT 67
| Back to Contents |
Our NEOs participate in our Executive Severance Program, which provides for severance payments in the eventcertain events of termination of employment, provided the executive executes a release in favor of the Company. Under the terms of the Executive Severance Plan Participation Agreement between Lyondell Chemical Company and Mr. Vanacker (the “CEO Participation Agreement”), in the event of a termination by the CEO for Good Reason or by the Company without Cause (each as defined below), our CEO will receive a lump sum payment equal to 1.5 times the sum of his base salary and target annual bonus amount for the preceding year. Under the terms of the Company'sCompany’s Executive Severance Plan, in the event of a termination by anyan NEO other than the CEO for Good Reason or by the Company without cause, such NEO will receive a lump sum payment equal to (1) the sum of the NEO’s base salary and target annual bonus amount for the preceding year. year (except the CEO, who will receive two times such sum), plus (2) an amount equal to the cost of 18 months of continuation coverage premiums for medical coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, at the subsidized rates that active employees pay to effectuate similar coverage in effect on the termination date. In addition, under the Executive Severance Plan, an NEO who is terminated within two years of a change in control will receive a one-time payment equal to two times the sum of his base salary plus target annual bonus (except the CEO, who will receive three times such sum). In each case, such NEO will also continue to receive subsidized coverage at active employee rates under the Company’s life insurance plan for 18 months following the date of termination, if permissible, and will receive outplacement assistance with a provider designated by the Company.
Under the terms of the Company’s STI program, all NEOs will receive pro rata annual bonus payments in the event of termination of employment due to death or disability or termination without Cause, payable following certification of payout under the STI program the following year. Additionally, under the terms of our LTIP and equity award agreements, our NEOs will receive accelerated or pro-rated vesting of their equity awards upon termination in certain circumstances.
In the event of a change-in-control of the Company, the vesting of equity awards will be accelerated or pro-rated, but only if the individual’s employment is terminated within one year of the change in control. The Company believes that this “double trigger” is appropriate because it ensures our executives do not have conflicts in the event of a change in control and also avoids windfalls for any employees whose employment with the Company or its successors continues following such an event. The treatment of the equity awards for the NEOs is the same as for all other employees who receive equity awards. In addition, under the terms of the CEO Participation Agreement, our CEO will receive a one-time payment equal to 2.5 times the sum of his base salary plus target annual bonus in the event of a termination within one year of a change in control.
A summary of the treatment of equity awards granted through December 31, 2023 in different scenarios under the terms of our LTIP and the award agreements is provided below. “Cause” and “Good Reason” are defined in the Company’s Executive Severance Plan as follows:
“Cause” means (i) the executive’s continued failure (except where due to physical or mental incapacity) to substantially perform his or her duties; (ii) the executive’s intentional misconduct or gross neglect in the performance of his or her duties; (iii) the executive’s conviction of, or plea of guilty or nolo contendere to, a felony; (iv) the commission by the executive of an act of fraud or embezzlement against the Company or any affiliate; (v) the executive’s breach of fiduciary duty, (vi) an executive’s violation of the Company’s Code of Conduct or (vii) the executive’s willful breach of any material provision of any employment or other written agreement between the executive and the Company or an affiliate (as determined in good faith by the C&TD Committee) which is not remedied within 15 days after written notice is received from the Company or affiliate specifying the breach. Any determination of whether Cause exists shall be made by the C&TD Committee in its sole discretion.
“Good Reason” means the occurrence, without the Participant’s express written consent, of (i) a material diminution in the executive’s duties, responsibilities or authority; (ii) any material diminution of the executive’s Base Salary; or (iii) the involuntary relocation of the executive’s principal place of employment by more than 50 miles from the executive’s principal place of employment immediately prior to thesuch relocation. Any assertion by an executive of a termination of employment for “Good Reason” will not be effective unless certain conditions regarding notice and cure are satisfied.
| 2024Proxy Statement | LyondellBasell | 74 |
| Termination of Employment for Cause by the Company or without Good Reason by the Executive | |
| • | All unvested awards are forfeited. In the event of termination for Cause by the Company, unexercised stock options are also forfeited. In the event of resignation without Good Reason by the executive, previously vested options may be exercised for 90 days after termination of employment. |
| Termination of Employment without Cause by the Company | |
| • | Stock options, RSUs, and PSUs vest pro rata. |
| • | Stock options: Stock options provide for vesting in equal installments on the first three anniversaries of the grant date. In the event of termination without Cause, pro-ration is determined for each unvested installment separately based on the number of months worked from the date of grant until termination divided by the number of months from the date of grant until the original vesting date for that installment. The options may be exercised for 90 days after termination of employment. |
| • | RSUs and PSUs: Pro-ration is determined based on the number of months worked from the date of grant (for RSUs) or beginning of the relevant performance period (for PSUs) until termination divided by the number of months in the vesting or performance period, respectively. The number of units earned under the PSUs is based on performance over the applicable three-year performance period as determined by the C&TD Committee in the first quarter after the end of the performance period and can range from 0 to 200% of target. |
| Termination of Employment with Good Reason by the Executive | |
| • | All unvested awards are forfeited and previously vested options may be exercised for 90 days after termination of employment. |
| Termination of Employment without Cause by the Company or with Good Reason by the Executive within 12 Months of a Change in Control | |
| • | Stock options and RSUs: All stock options and RSUs are immediately vested. Stock options remain exercisable for 90 days. |
| • | PSUs: PSUs vest pro rata based on the number of months worked from the beginning of the performance period until termination divided by the number of months in the performance period. The number of units earned under the PSUs is based on the C&TD Committee’s determination of performance results as of the last quarter prior to the change in control. |
| Retirement | |
| • | Under the Company’s award agreements, “Retirement” means an executive’s termination of service (i) on or after age 55 with 10 years of service, (ii) on or after age 55 with 7 years of service for Mr. Vanacker, or (iii) on or after age 65 for Mr. Rhenman. For all NEOs, “Enhanced Retirement” means an executive’s termination of service on or after age 60 with at least 10 years of service. None of our other NEOs currently meet the requirements for Retirement or Enhanced Retirement. |
| • | In the event of Retirement, all awards vest pro rata, based on the same calculations as in the case of a termination without Cause. Stock options remain exercisable for five years or their original term, whichever is shorter. In the event of Enhanced Retirement, all awards vest in full on their original vesting schedule. The Company’s award agreements provide that an executive who meets the requirements for Enhanced Retirement will be subject to non-competition, non-solicitation, and other restrictive covenants for two years following his or her retirement and, beginning with 2022 awards, executives who meet the requirements for Retirement will also be subject to one-year restrictive covenants. Stock options remain exercisable for their original term. |
| Death or Disability | |
| • | Stock Options and RSUs: Stock options and RSUs vest immediately. The stock options remain exercisable for one year. |
| • | PSUs: PSUs vest pro rata, based on the same calculations as for PSUs in the case of a termination without Cause. |
Termination of Employment for Cause by the Company or without Good Reason by the Executive
| 2024Proxy Statement | LyondellBasell | 75 |
All unvested awards are forfeited. In the event of termination for Cause by the Company, unexercised stock options are also forfeited. In the event of resignation without Good Reason by the executive, previously vested options may be exercised for 90 days after termination of employment.
Stock options, RSUs, and PSUs vest pro rata. Cash retention awards vest in full.
Stock options: Stock options provide for vesting in equal installments on the first three anniversaries of the grant date. In the event of termination without Cause, pro-ration is determined for each unvested installment separately based on the number of months worked from the date of grant until termination divided by the number of months from the date of grant until the original vesting date for that installment. The options may be exercised for 90 days after termination of employment.
RSUs and PSUs: Pro-ration is determined based on the number of months worked from the date of grant (for RSUs) or beginning of the relevant performance period (for PSUs) until termination divided by the number of months in the vesting or performance period, respectively. The number of units earned under the PSUs is based on performance over the applicable three-year performance period as determined by the C&TD Committee in the first quarter after the end of the performance period and can range from 0 to 200% of target.
LYONDELLBASELL 2023 PROXY STATEMENT 68
All unvested awards are forfeited and previously vested options may be exercised for 90 days after termination of employment.
Termination of Employment without Cause by the Company or with Good Reason by the Executive within 12 Months of a Change in Control
Stock options and RSUs: All stock options and RSUs are immediately vested. Stock options remain exercisable for 90 days.
PSUs: PSUs vest pro rata based on the number of months worked from the beginning of the performance period until termination divided by the number of months in the performance period. The number of units earned under the PSUs is based on the C&TD Committee’s determination of performance results as of the last quarter prior to the change in control.
Cash Retention Awards: Cash retention awards vest in full in the event of termination without Cause, but are forfeited in the event of termination with Good Reason.
Under the Company’s award agreements, “Retirement” means an executive’s termination of service (i) on or after age 55 with 10 years of service or (ii) for awards granted prior to 2020 and all awards granted to Mr. Rhenman, on or after age 65. For awards granted to Messrs. Guilfoyle, Lane, McMurray, and Rhenman in February 2020 and awards granted to all NEOs in February 2021 and since, “Enhanced Retirement” means an executive’s termination of service on or after age 60 with at least 10 years of service. Based on their current ages and tenures, Mr. Rhenman currently meets the requirements for Retirement. None of our other NEOs currently meet the requirements for Retirement or Enhanced Retirement.
In the event of Retirement, all awards (other than cash retention awards) vest pro rata, based on the same calculations as in the case of a termination without Cause. Stock options remain exercisable for five years or their original term, whichever is shorter. In the event of Enhanced Retirement, all awards vest in full on their original vesting schedule. The Company's award agreements provide that an executive who meets the requirements for Enhanced Retirement will be subject to non-competition, non-solicitation, and other restrictive covenants for two years following his or her retirement and, beginning with 2022 awards, executives who meet the requirements for Retirement will also be subject to one-year restrictive covenants. Stock options remain exercisable for their originalterm.
Stock Options and RSUs: Stock options and RSUs vest immediately. The stock options remain exercisable for one year.
PSUs and Cash Retention Awards: PSUs and cash retention awards vest pro rata, based on the same calculations as for PSUs in the case of a termination without Cause.
In accordance with SEC disclosure requirements, the tables below show, in dollars, the amounts our NEOs could receive in different circumstances if the termination events occurred as of December 31, 2022.2023, with the exception of Mr. Lane, who voluntarily resigned from his position effective March 15, 2024. Mr. Lane did not receive any payments or benefits in connection with his departure, and all his unvested equity awards as of March 15, 2024 were forfeited. We excluded any amounts for benefits or payments that are available to all salaried employees of the Company. The amounts shown are not the amounts the NEO would actually receive in a termination event, but are calculated as described below.
| Accelerated Option Awards(1) | Accelerated RSUs(2) | Pro-rated PSUs(3) | Cash Severance Payment(4) | Total(5) | ||||||
| Peter Vanacker | 46,065 | 5,893,344 | 4,720,817 | — | 10,660,226 | |||||
| Michael McMurray | 125,250 | 2,180,755 | 2,797,349 | — | 5,103,354 | |||||
| Jim Guilfoyle | 101,548 | 1,641,176 | 2,130,268 | — | 3,872,992 | |||||
| Torkel Rhenman | 101,970 | 1,731,312 | 2,277,831 | — | 4,111,113 | |||||
Termination by NEO for Good Reason | ||||||||||
| Pro-rated Option Awards(1) | Pro-rated RSUs(2) | Pro-rated PSUs(3) | Cash Severance Payment(4) | Total(5) | ||||||
| Peter Vanacker | — | — | — | 7,540,000 | 7,540,000 | |||||
| Michael McMurray | — | — | — | 1,657,500 | 1,657,500 | |||||
| Jim Guilfoyle | — | — | — | 1,546,545 | 1,546,545 | |||||
| Torkel Rhenman | — | — | — | 1,560,000 | 1,560,000 | |||||
Retirement or Termination without Cause | ||||||||||
| Pro-rated Option Awards(1) | Pro-rated RSUs(2) | Pro-rated PSUs(3) | Cash Severance Payment(4) | Total(5) | ||||||
| Peter Vanacker | 25,806 | 2,884,727 | 4,720,817 | 7,540,000 | 15,171,350 | |||||
| Michael McMurray | 96,639 | 1,338,251 | 2,797,349 | 1,657,500 | 5,889,739 | |||||
| Jim Guilfoyle | 78,729 | 1,019,638 | 2,130,268 | 1,546,545 | 4,775,180 | |||||
| Torkel Rhenman | 78,965 | 1,090,948 | 2,277,831 | 1,560,000 | 5,007,744 | |||||
| 2024Proxy Statement | LyondellBasell | 76 |
DEATH OR DISABILITY
| Accelerated Option Awards(1) | Accelerated RSUs(2) | Pro-rated PSUs(3) | Cash Severance Payment(4) | Total(5) | ||||||
| Peter Vanacker | 46,065 | 5,893,344 | 4,720,817 | 11,310,000 | 21,970,226 | |||||
| Michael McMurray | 125,250 | 2,180,755 | 2,797,349 | 3,315,000 | 8,418,354 | |||||
| Jim Guilfoyle | 101,548 | 1,641,176 | 2,130,268 | 3,093,090 | 6,966,082 | |||||
| Torkel Rhenman | 101,970 | 1,731,312 | 2,277,831 | 3,120,000 | 7,231,113 |
| (1) | The values for stock options included are calculated based on the number of options that would vest, multiplied by the difference between $95.08, the market value of our common stock as of December 31, 2023 (determined as the closing price of our common stock on the last preceding trading day), and the exercise price of the stock option. Amounts actually received by the NEO would depend on the fair market value of our shares after his termination when the options are exercised. |
| (2) | The values of the RSUs are based on the number of RSUs that would vest multiplied by the fair market value of our stock on December 31, 2023, which may be different than the fair market value of our stock upon a termination event. |
| (3) | PSUs accumulate dividend equivalents that are converted to additional units at the end of the performance period, subject to the same terms and conditions as the original award. The values of the PSUs are based on the number of units that would vest multiplied by the market value of our stock on December 31, 2023. The values above assume that the payout is at target, or 100%. The actual payout would be determined by the C&TD Committee after the performance period or, in the case of termination without Cause or by the NEO for Good Reason within 12 months of a change in control, as of the end of the last quarter prior to the change in control. Also, although the values are calculated as of December 31, 2023, the shares would not be issued until the first quarter after the end of the original performance period of the awards. |
| (4) | Cash Severance Payment includes target bonus payment under the 2023 STI program. Cash severance is not payable in the event of Death or Disability and Retirement. |
| (5) | In addition to the above, each of the NEOs would receive a lump sum payment of approximately $35,000 for the cost of eighteen months of continuation coverage premiums for medical coverage for himself and his dependents in any termination event other than death and disability. All NEOs would also receive Company-provided outplacement services for 12 months. |
| 2024Proxy Statement | LyondellBasell | 77 |
| Accelerated Option Awards(1) | Accelerated RSUs(2) | Pro-rated PSUs(3) | Pro-rated Cash Awards(4) | Cash Severance Payment(5) | Total(6) |
Peter Vanacker | — | 3,687,611 | 1,280,406 | — | — | 4,968,017 |
Ken Lane | 64,167 | 2,713,752 | 2,222,297 | — | — | 5,000,216 |
Michael McMurray | 82,667 | 1,798,014 | 2,684,443 | — | — | 4,565,124 |
Jim Guilfoyle | 48,497 | 1,288,875 | 1,791,539 | — | — | 3,128,911 |
Jeffrey Kaplan | 53,358 | 1,243,706 | 1,813,707 | — | — | 3,110,771 |
Torkel Rhenman | 69,301 | 1,501,514 | 2,248,037 | — | — | 3,818,852 |
LYONDELLBASELL 2023 PROXY STATEMENT 69
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The following table provides information as of December 31, 20222023 about the number of shares to be issued upon vesting or exercise of equity awards and the number of shares remaining available for issuance under our equity compensation plans.
| Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights(2)(3) | Weighted-Average Exercise Price of Outstanding Options, Warrants, and Rights(4) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans(5) | |||||
| Equity compensation plans approved by security holders(1) | 5,723,194 | $ | 90.02 | 10,528,161 | ||||
| Equity compensation plans not approved by security holders | — | — | — | |||||
| TOTAL | 5,723,194 | $ | 90.02 | 10,528,161 | ||||
| (1) | Includes the LyondellBasell Industries Long Term Incentive Plan, as amended and restated (the “LTIP”) and the LyondellBasell Global Employee Stock Purchase Plan, as amended and restated (the “ESPP”). |
| (2) | Includes 2,643,693 shares that may be issued pursuant to outstanding stock options and 1,156,439 shares that may be issued pursuant to outstanding RSUs. Additionally, 962,418 PSUs were outstanding as of December 31, 2023, including accrued dividend equivalents. The C&TD Committee determines the actual number of shares the recipient receives at the end of a three-year performance period which may range from 0 to 200% of the target number of shares. Because up to 200% of the target number of shares may ultimately be issued, we have included an aggregate of 1,923,062 shares, the maximum possible payout under the PSUs, as the number that may be issued. |
| (3) | Excludes purchase rights that accrue under the ESPP. Purchase rights under the ESPP are considered equity compensation for accounting purposes. However, the number of shares to be purchased is indeterminable until the time shares are actually issued, as automatic employee contributions may be terminated before the end of an offering period and, due to the pricing feature, the purchase price and corresponding number of shares to be purchased is unknown. |
| (4) | Includes only the weighted-average exercise price of the outstanding stock options. Does not include RSUs or PSUs, as those awards have no exercise price associated with them. Also excludes purchase rights under the ESPP for the reasons described in note (3) above. |
| (5) | The shares remaining available as of December 31, 2023 include 7,778,231 shares under the LTIP and 2,749,930 shares under the ESPP. |
| 2024Proxy Statement | LyondellBasell | 78 |
Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants, and Rights(2)(3) | Weighted-Average Exercise Price of Outstanding Options, Warrants, and Rights(4) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans(5) | |
Equity compensation plans approved by security holders(1) | 5,363,362 | $ | 87.45 | 12,199,256 |
Equity compensation plans not approved by security holders | — |
| — | — |
TOTAL | 5,363,362 | $ | 87.45 | 12,199,256 |
(1) Includes the LTIP and the LyondellBasell Global Employee Stock Purchase Plan, as amended and restated (the “ESPP”). (2) Includes 2,585,377 shares that may be issued pursuant to outstanding stock options and 975,066 shares that may be issued pursuant to outstanding RSUs. Additionally, 901,459 PSUs were outstanding as of December 31, 2022, including accrued dividend equivalents. The C&TD Committee determines the actual number of shares the recipient receives at the end of a three-year performance period which may range from 0 to 200% of the target number of shares. Because up to 200% of the target number of shares may ultimately be issued, we have included an aggregate of 1,802,919 shares, the maximum possible payout under the PSUs, as the number that may be issued. (3) Excludes purchase rights that accrue under the ESPP. Purchase rights under the ESPP are considered equity compensation for accounting purposes. However, the number of shares to be purchased is indeterminable until the time shares are actually issued, as automatic employee contributions may be terminated before the end of an offering period and, due to the pricing feature, the purchase price and corresponding number of shares to be purchased is unknown. (4) Includes only the weighted-average exercise price of the outstanding stock options. Does not include RSUs or PSUs, as those awards have no exercise price associated with them. Also excludes purchase rights under the ESPP for the reasons described in note (3) above. (5) The shares remaining available as of December 31, 2022 include 9,134,270 shares under the LTIP and 3,064,986 shares under the ESPP. | ||||
LYONDELLBASELL 2023 PROXY STATEMENT 72
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Pursuant to SEC rules, we are required to provide the following information with respect to fiscal 2022:2023:
The annual total compensation of the global median employee of our company (other than Mr. Vanacker, our CEO), was $93,846;
| • | The annual total compensation of the global median employee of our company (other than Mr. Vanacker, our CEO), was $106,365; |
| • | The annual total compensation of Mr. Vanacker, our CEO, was $16,546,194; and |
| • | Based on this information, the ratio of the annual total compensation of our CEO to the annual total compensation of the global median employee is 156 to 1. |
The annualized total compensation of Mr. Vanacker, our CEO, was $17,557,450; and
Based on this information, the ratio of the annual total compensation of our CEO to the annual total compensation of the global median employee is 187 to 1.
For purposes of determining our CEO’s annual total compensation, we elected to use the annualized compensation of Mr. Vanacker, who has served as our CEO since May 23, 2022.
We understand that the CEO pay ratio is intended to provide greater transparency to annual CEO pay and how it compares to the pay of the median employee. As such, we are providing a supplemental ratio that compares the CEO’s total target pay of $13,386,554, which includes Mr. Vanacker’s annualized base salary, annual bonus and annual equity grant target, but excludes the special one-time cash signing bonus and equity signing bonus, which were inducements to join the Company, to the pay of the median associate. We believe this supplemental ratio reflects a more representative comparison. The resulting supplemental CEO pay ratio is 143 to 1.
Per SEC rules, for 2022, we identified a new global median employee on December 31, 2022 based on 2022 compensation and the employee population. The global median employee for fiscal year 2022 was identified by examining the 2022 total compensation for all regular full- and part-time employees who were actively employed by the Company on December 31, 2022 and students and interns who were hired for partial periods during 2022. For these employees, annual compensation was calculated using methodology and guidelines consistent with the approach used to determine our median employee for 2018 and 2019.
| • | To find the annual total compensation of all of our employees (other than our CEO), we considered all gross and net components of compensation (including short- and long-term incentives) received by each employee and documented in the year-end payroll records for 2022. |
| • | Compensation for full- and part-time employees hired during 2022 and still active as of December 31, 2022 was annualized. Compensation for all students and interns hired for partial periods during 2022 was not annualized. |
| • | Annual compensation for expatriate employees and employees involved in permanent cross-border transfers during 2022 was calculated using all relevant country payroll records. |
Although there was no change in the year-end payroll records for 2022.
Compensation for full- and part-time employees hiredCompany’s employee population or compensation arrangements in 2023 that would result in a significant change to the Company’s pay ratio disclosure, we have used a different median employee this year because the previously identified 2022 median employee left the Company during the year. In accordance with SEC rules, the newly selected global median employee is an employee with substantially similar 2022 and still active as of December 31, 2022 was annualized. Compensation for all students and interns hired for partial periods during 2022 was not annualized.
Annual compensation for expatriate employees and employees involved in permanent cross-border transfers during 2022 was calculated using all relevant country payroll records.
to the prior global median employee. After identifying thethis 2023 global median employee, we calculated 20222023 total compensation for the selected employee using the same methodology used for our NEOs as set forth in the Summary Compensation Table.
| 2024Proxy Statement | LyondellBasell | 79 |
LYONDELLBASELL 2023 PROXY STATEMENT 73
In accordance with rules adopted by the SEC pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, we provide the following disclosure regarding executive compensation for our principal executive officer (“PEO”) and non-PEO NEOs and Company performance for fiscal years listed below. The C&TD Committee did not consider the pay versus performance disclosure below in making its pay decisions for any of the fiscal years shown.
| Summary Compen- sation Table | Compen- sation | Summary Compen- sation Table | Compen- sation | Summary Compen- sation Table | Compen- sation | Average Summary Compen- sation Table | Average Compen- sation | Value of Initial Fixed $100 Investment Based On:(3) | ||||||||||||||||
| Year | Total for Bhavesh Patel(1) ($) | Actually paid to Bhavesh Patel(1)(2) ($) | Total for Kenneth Lane(1) ($) | Actually Paid to Kenneth Lane(1)(2) ($) | Total for Peter Vanacker(1) ($) | Actually Paid to Peter Vanacker(1)(2) ($) | Total for Non-PEO NEOs(1) ($) | Actually Paid to Non-PEO NEOs(1)(2) ($) | TSR ($) | Peer Group TSR ($) | Net Income ($MM) | EBITDA(4) ($MM) | ||||||||||||
| 2023 | — | — | — | — | 16,546,194 | 21,206,198 | 5,168,076 | 7,754,168 | 128.90 | 146.45 | 2,121 | 4,509 | ||||||||||||
| 2022 | — | — | 8,798,076 | 9,046,842 | 17,018,989 | 14,863,867 | 5,818,984 | 6,400,521 | 106.81 | 131.89 | 3,889 | 6,301 | ||||||||||||
| 2021 | 19,011,033 | 1,514,901 | — | — | — | — | 4,615,231 | 4,648,678 | 107.73 | 148.63 | 5,617 | 8,689 | ||||||||||||
| 2020 | 15,570,513 | 16,833,907 | — | — | — | — | 3,288,167 | 3,043,798 | 102.57 | 118.05 | 1,427 | 3,285 | ||||||||||||
| (1) | Bhavesh Patel was our PEO from January 1, 2020 to December 31, 2021. Kenneth Lane (who served as Interim CEO) was our PEO from January 1, 2022 to May 22, 2022. Peter Vanacker is our PEO since May 23, 2022. The Non-PEO NEOs for whom the average compensation is presented in this table are: (a) for 2023: Michael McMurray, Kenneth Lane, Torkel Rhenman, and Jim Guilfoyle; (b) for 2022: Michael McMurray, Torkel Rhenman, Jeffrey Kaplan, and Jim Guilfoyle; (c) for 2021: Michael McMurray, Kenneth Lane, Torkel Rhenman, and Jim Guilfoyle; and (d) for 2020: Michael McMurray, Kenneth Lane, Torkel Rhenman, Jeffrey Kaplan, and Daniel Coombs. |
| (2) | The amounts shown as Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized or received by the Company’s NEOs. Deductions from, and additions to, 2023 total compensation in the Summary Compensation Table to calculate Compensation Actually Paid consist of: |
| (3) | The Peer Group TSR set forth in this table utilizes the S&P 500 Chemicals Index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report for the year ended December 31, 2023. The comparison assumes $100 was invested, for the period starting December 31, 2019 through the end of the listed year, in the Company and in the S&P 500 Chemicals Index, respectively. Historical stock performance is not necessarily indicative of future stock performance. |
| (4) | We determined EBITDA, which is a non-GAAP financial measure, to be the most important financial performance measure used to link Company performance to Compensation Actually Paid to our PEO and Non PEO NEOs in 2023. More information on EBITDA can be found in Appendix A to this proxy statement. We may determine a different financial performance measure to be the most important financial performance measure in future years. |
| (1) | Bhavesh Patel was our PEO from January 1, 2020 to December 31, 2021. Kenneth Lane (who served as Interim CEO) was our PEO from January 1, 2022 to May 22, 2022. Peter Vanacker is our PEO since May 23, 2022. The Non-PEO NEOs for whom the average compensation is presented in this table are: |
| (a) | for 2023: Michael McMurray, Kenneth Lane, Torkel Rhenman, and Jim Guilfoyle; | |
| (b) | for 2022: Michael McMurray, Torkel Rhenman, Jeffrey Kaplan, and Jim Guilfoyle; | |
| (c) | for 2021: Michael McMurray, Kenneth Lane, Torkel Rhenman, and Jim Guilfoyle; and | |
| (d) | for 2020: Michael McMurray, Kenneth Lane, Torkel Rhenman, Jeffrey Kaplan, and Daniel Coombs. |
| (2) | The amounts shown as Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized or received by the Company’s NEOs. Deductions from, and additions to, 2023 total compensation in the Summary Compensation Table to calculate Compensation Actually Paid consist of: |
| Peter Vanacker ($) | Average Non-PEO NEOs ($) | ||||||
| Total Compensation from Summary Compensation Table | 16,546,194 | 5,168,076 | |||||
| Adjustments for Pension | |||||||
| Adjustment for Summary Compensation Table Pension | (16,479) | (26,988) | |||||
| Amount added for current year service cost | 12,475 | 15,953 | |||||
| Amount added for prior service cost impacting current year | — | — | |||||
| TOTAL ADJUSTMENTS FOR PENSION | (4,004) | (11,035) | |||||
| Adjustments for Equity Awards | |||||||
| Adjustment for grant date values in the Summary Compensation Table | (11,642,449) | (2,899,160) | |||||
| Year-end fair value of unvested awards granted in the current year | 12,191,177 | 3,497,130 | |||||
| Year-over-year difference of year-end fair values for unvested awards granted in prior years | 3,902,254 | 1,475,602 | |||||
| Fair values at vest date for awards granted and vested in current year | — | — | |||||
| Difference in fair values between prior year end fair values and vest date fair values for awards granted in prior years | 213,026 | 523,555 | |||||
| Forfeitures during current year equal to prior year-end fair value | — | — | |||||
| Dividends or dividend equivalents not otherwise included in the total compensation | — | — | |||||
| TOTAL ADJUSTMENTS FOR EQUITY AWARDS | 4,664,008 | 2,597,127 | |||||
| Compensation Actually Paid (as calculated) | 21,206,198 | 7,754,168 | |||||
| (3) | The Peer Group TSR set forth in this table utilizes the S&P 500 Chemicals Index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report for the year ended December 31, 2023. The comparison assumes $100 was invested, for the period starting December 31, 2019 through the end of the listed year, in the Company and in the S&P 500 Chemicals Index, respectively. Historical stock performance is not necessarily indicative of future stock performance. |
| (4) | We determined EBITDA, which is a non-GAAP financial measure, to be the most important financial performance measure used to link Company performance to Compensation Actually Paid to our PEO and Non PEO NEOs in 2023. More information on EBITDA can be found in Appendix A to this proxy statement. We may determine a different financial performance measure to be the most important financial performance measure in future years. |
| 2024Proxy Statement | LyondellBasell | 80 |
Year | Summary Compen- sation Table Total for Bhavesh Patel(1) ($) | Compen- sation Actually paid to Bhavesh Patel(1)(2) ($) | Summary Compen- sation Table Total for Kenneth Lane(1) ($) | Compen- sation Actually Paid to Kenneth Lane(1)(2) ($) | Summary Compen- sation Table Total for Peter Vanacker(1) ($) | Compen- sation Actually Paid to Peter Vanacker(1)(2) ($) | Average Summary Compen- sation Table Total for Non-PEO NEOs(1) ($) | Average Compen- sation Actually Paid to Non-PEO NEOs(1)(2) ($) | Value of Initial Fixed $100 Investment Based On:(3) | Net Income ($MM) | EBITDA(4) ($MM) | |||||||||||||
TSR ($) | Peer Group TSR ($) | |||||||||||||||||||||||
(a) |
| (b) |
| (c) |
| (b) |
| (c) |
| (b) |
| (c) |
| (d) |
| (e) |
| (f) |
| (g) |
| (h) |
| (i) |
2022 |
| — |
| — |
| 8,798,076 |
| 9,046,842 |
| 17,018,989 |
| 14,863,867 |
| 5,818,984 |
| 6,400,521 |
| 106.81 |
| 131.89 |
| 3,889 |
| 6,301 |
2021 |
| 19,011,033 |
| 1,514,901 |
| — |
| — |
| — |
| — |
| 4,615,231 |
| 4,648,678 |
| 107.73 |
| 148.63 |
| 5,617 |
| 8,689 |
2020 |
| 15,570,513 |
| 16,833,907 |
| — |
| — |
| — |
| — |
| 3,288,167 |
| 3,043,798 |
| 102.57 |
| 118.05 |
| 1,427 |
| 3,285 |
(1) Bhavesh Patel was our PEO from January 1, 2020 to December 31, 2021. Kenneth Lane (who served as Interim CEO) was our PEO from January 1, 2022 to May 22, 2022. Peter Vanacker is our PEO since May 23, 2022. The Non-PEO NEOs for whom the average compensation is presented in this table are: (a) for 2022: Michael McMurray, Torkel Rhenman, Jeffrey Kaplan, and Jim Guilfoyle; (b) for 2021: Michael McMurray, Kenneth Lane, Torkel Rhenman, and Jim Guilfoyle; and (c) for 2020: Michael McMurray, Kenneth Lane, Torkel Rhenman, Jeffrey Kaplan, and Daniel Coombs. (2) The amounts shown as Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized or received by the Company’s NEOs. These amounts reflect total compensation as set forth in the Summary Compensation Table for each year, adjusted as described in the table below. Deductions from, and additions to, total compensation in the Summary Compensation Table by year to calculate Compensation Actually Paid consist of: | ||||||||||||||||||||||||
| 2020 |
| 2021 |
| 2022 | |||||||||||
Bhavesh Patel ($) |
| Average Non-PEO NEOs ($) |
| Bhavesh Patel ($) |
| Average Non-PEO NEOs ($) |
| Kenneth Lane ($) |
| Peter Vanacker ($) |
| Average Non-PEO NEOs ($) |
| |||
Total Compensation from Summary Compensation Table | 15,570,513 |
| 3,288,167 |
|
| 19,011,033 |
| 4,615,231 |
|
| 8,798,076 |
| 17,018,989 |
| 5,818,984 |
|
Adjustments for Pension |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustment for Summary Compensation | (17,552 | ) | (14,369 | ) |
| (16,967 | ) | (15,007 | ) |
| (11,365 | ) | (13,547 | ) | (8,207 | ) |
Amount added for current year service cost | 12,749 |
| 11,602 |
|
| 13,190 |
| 13,803 |
|
| 12,312 |
| 11,758 |
| 13,705 |
|
Amount added for prior service cost impacting current year | — |
| — |
|
| — |
| — |
|
| — |
| — |
| — |
|
Total Adjustments for Pension | (4,803 | ) | (2,767 | ) |
| (3,777 | ) | (1,204 | ) |
| 947 |
| (1,789 | ) | 5,498 |
|
Adjustments for Equity Awards |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustment for grant date values in the Summary Compensation Table | (11,812,570 | ) | (2,042,612 | ) |
| (13,102,970 | ) | (2,506,411 | ) |
| (4,299,929 | ) | (12,176,040 | ) | (2,334,990 | ) |
Year-end fair value of unvested awards | 16,001,410 |
| 2,244,968 |
|
| 3,227,848 |
| 3,023,906 |
|
| 4,076,099 |
| 10,022,707 |
| 2,406,671 |
|
Year-over-year difference of year-end fair values for unvested awards granted in prior years | (1,156,187 | ) | (31,678 | ) |
| (8,475,641 | ) | (674,946 | ) |
| 363,333 |
| — |
| 357,892 |
|
Fair values at vest date for awards granted | — |
| 13,751 |
|
| 2,770,173 |
| — |
|
| — |
| — |
| — |
|
Difference in fair values between prior year-end fair values and vest date fair values for awards granted in prior years | (1,764,456 | ) | (249,966 | ) |
| 2,686,284 |
| 192,102 |
|
| 108,316 |
| — |
| 146,466 |
|
Forfeitures during current year equal to prior year-end fair value | — |
| (176,065 | ) |
| (4,598,049 | ) | — |
|
| — |
| — |
| — |
|
Dividends or dividend equivalents not otherwise included in the total compensation | — |
| — |
|
| — |
| — |
|
| — |
| — |
| — |
|
Total Adjustments for Equity Awards | 1,268,197 |
| (241,602 | ) |
| (17,492,355 | ) | 34,651 |
|
| 247,819 |
| (2,153,333 | ) | 576,039 |
|
Compensation Actually Paid (as calculated) | 16,833,907 |
| 3,043,798 |
|
| 1,514,901 |
| 4,648,678 |
|
| 9,046,842 |
| 14,863,867 |
| 6,400,521 |
|
LYONDELLBASELL 2023 PROXY STATEMENT 74
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|
The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our other NEOs, and the Company’s cumulative TSR over the three most recently completed fiscal years.
The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our other NEOs, and the Company’s Net Income during the three most recently completed fiscal years.
| 2024Proxy Statement | LyondellBasell | 81 |
LYONDELLBASELL 2023 PROXY STATEMENT 75
| Back to Contents |
The following chart sets forth the relationship between Compensation Actually Paid to our PEOs, the average of Compensation Actually Paid to our other NEOs, and our EBITDA during the three most recently completed fiscal years.
The following chart compares our cumulative TSR over the threefour most recently completed fiscal years to that of the S&P 500 Chemicals Index over the same period.
| 2024Proxy Statement | LyondellBasell | 82 |
The following table presents the financial and non-financial performance measures that the Company considers to have been the most important in linking Compensation Actually Paid to our PEOsPEO and Non-PEO NEOs for 20222023 to Company performance:performance. The measures in this table are not ranked.
(in alphabetical order) |
EBITDA |
|
Free Cash Flow per Share |
Safety |
Sustainability |
| Value Enhancement Program Results |
| 2024Proxy Statement | LyondellBasell | 83 |
LYONDELLBASELL 2023 PROXY STATEMENT 76
|
We provide shareholders the ability to vote on our executive compensation on an annual basis. Under SEC rules, every six years, shareholders are given the opportunity to express their views on how frequently the say-on-pay vote should occur. Under this proposal, shareholders may vote to have the say-on-pay vote every year, every two years, or every three years.
In 2017, there was an overwhelming majority of votes cast in favor of voting on say-on-pay annually. We continue to believe that say-on-pay votes should be conducted every year so that our shareholders may express their views on our executive compensation program.
As an advisory vote, this proposal is not binding on the Company, the Board or the C&TD Committee. However, the C&TD Committee and the Board value the opinions expressed by shareholders and will consider the outcome of the vote when making decisions regarding the frequency of conducting a say-on-pay vote.
Our next advisory vote on the frequency of the say-on-pay vote will be in 2029.
 | The Board recommends that you vote FORthe proposal to grant authority to the Board to repurchase up to 10% of our issued share capital until November |
Under Dutch law and our Articles of Association, shareholder approval is necessary to authorize our Board to repurchase shares. At the annual general meeting of shareholders held on May 27, 2022,19, 2023, shareholders authorized the Board to repurchase up to 10% of our outstanding shares. As of April 1, 2023,2024, we have repurchased an aggregate of approximately [__][ ] million shares pursuant to this authorization.
Adoption of the current proposal will give us the flexibility to continue to repurchase shares if we believe it is an appropriate use of our liquidity. The number of shares repurchased, if any, and the timing and manner of any repurchases will be determined after taking into consideration prevailing market conditions, our available resources, and other factors that cannot now be predicted.
In order to provide us with sufficient flexibility, we propose that shareholders grant authority to the Board to repurchase up to 10% of our issued share capital as of the date of the Annual Meeting (or, based on the number of shares issued as of April 1, 2023,2024, approximately [__][ ] shares) on the open market, through privately negotiated repurchases, in self-tender offers, or through accelerated repurchase arrangements, at prices ranging from the nominal value of our shares up to 110% of the market price for our shares; provided that (i)foropen market or privately negotiated repurchases, the market price shall be the price for our shares on the NYSE at the time of the transaction; (ii) for self-tender offers, the market price shall be the volume weighted average price (“VWAP”) for our shares on the NYSE during a period, determined by the Board, of no less than one and no greater than five consecutive trading days immediately prior to the expiration of the tender offer; and (iii) for accelerated repurchase arrangements, the market price shall be the VWAP for our shares on theNYSE over the term of the arrangement. The VWAP for any number of trading days shall be calculated as the arithmetic average ofthe daily VWAP on those trading days.
If approved, the authority will extend for 18 months from the date of the Annual Meeting, or until November 19, 2024,24, 2025, and will replace the current repurchase authorization of the Board which was approved by shareholders at the annual general meeting on May 27, 2022.19, 2023. Anyshares repurchased under this authority may be cancelled pursuant to the authorization to cancel shares requested under Item 98 below.
| 2024Proxy Statement | LyondellBasell | 84 |
LYONDELLBASELL 2023 PROXY STATEMENT 77
| The Board recommends that you vote FORthe proposal to cancel all or a portion of the shares in our treasury account. |
Under Dutch law and our Articles of Association, shareholder approval is necessary to cancel ordinary shares that are held in treasury by us, or that may in the future be held in treasury by us as a result of share repurchases. Also under Dutch law, the number of shares held by us, or our subsidiaries, may not exceed 50% of our issued share capital at any time.
As of April 1, 2023,2024, we held approximately [__][ ] million shares in our treasury account, primarily as the result of share repurchases. Treasury shares, if not cancelled, may be used for general corporate purposes, including for issuance under our equity compensation plans.
We are requesting that shareholders approve the cancellation of all or any portion of shares held in our treasury account or that may be repurchased pursuant to the authority requested under Item 8,7, above.
If this Item 98 is adopted, the cancellation of treasury shares may be executed in one or more tranches. The number of treasury shares that will be cancelled, if any, will be determined by the Board. If the Board determines it is appropriate to cancel our shares, we will follow the procedure set forth under Dutch law to cancel treasury shares from time to time. In accordance with Dutch statutory provisions, the cancellation of treasury shares will not be effective until two months after the resolution to cancel treasury shares has been filed with theDutch Trade Register and announced in a Dutch national daily newspaper. Once the procedure is complete, the relevant treasury shares will be cancelled.
If this Item 98 is not approved, we will not cancel any treasury shares unless the general meeting of shareholders approves such cancellation at a later date.
| 2024Proxy Statement | LyondellBasell | 85 |
LYONDELLBASELL 2023 PROXY STATEMENT 78
The table below shows information for shareholders known to us to beneficially own more than 5% of our shares.
| Shares Beneficially Owned | ||||
| Name and Address |
| |||
Number | Percentage(1) | |||
Certain affiliates of Access Industries, LLC(2) |
| 65,285,504 | [ | |
The Vanguard Group(3) |
| 31,223,387 | [ | |
BlackRock, Inc.(4)
|
| 24,051,819 | [ | |
Dodge & Cox(5) |
| 16,210,777 | [ | |
(1) | All percentages are based on |
| (2) | Information is based on a Form |
| (3) | Information is based on a Schedule 13G/A filed with the SEC on February |
| (4) | Information is based on a Schedule 13G/A filed with the SEC on |
| (5) | Information is based on a Schedule |
| 2024Proxy Statement | LyondellBasell | 86 |
LYONDELLBASELL 2023 PROXY STATEMENT 79
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Information relating to the beneficial ownership of our shares by each director, director nominee, and executive officer named in the Summary Compensation Table is included below, as is information with respect to all of these individuals and all other executive officers of the Company, as a group. Shares are considered to be beneficially owned by a person if he or she, directly or indirectly, has sole or shared voting or investment power with respect to such shares. In addition, a person is deemed to beneficially own shares if that person has the right to acquire such shares within 60 days of March 15, 2023.2024. The individuals set forth in the table below, individually and in the aggregate, beneficially own less than 1% of our outstanding shares as of March 15, 2024.
| Number of | Stock Options Exercisable Within 60 days | |||||
| Name | Shares | RSUs(1) | ||||
| Peter Vanacker | 6,453 | — | 67,776 | |||
| Michael McMurray | 58,116 | — | 169,881 | |||
| Ken Lane(2) | 61,496 | — | 10,235 | |||
| Jim Guilfoyle | 49,471 | — | 121,597 | |||
| Torkel Rhenman | 53,339 | — | 103,563 | |||
| Jacques Aigrain | 21,967 | — | — | |||
| Lincoln Benet | 7,743 | — | — | |||
| Robin Buchanan | 10,416 | — | — | |||
| Tony Chase | 4,456 | — | — | |||
| Bob Dudley | 2,650 | — | — | |||
| Claire Farley | 18,738 | — | — | |||
| Rita Griffin | — | — | — | |||
| Michael Hanley | 9,012 | — | — | |||
| Virginia Kamsky | 1,801 | — | — | |||
| Bridget Karlin | — | — | — | |||
| Albert Manifold | 7,522 | — | — | |||
| ALL DIRECTORS, NOMINEES, AND EXECUTIVE OFFICERS AS A GROUP (22 PERSONS)(3) | 329,985 | 810 | 529,065 | |||
| (1) | Represents RSUs (each equivalent to a share of LYB stock) that will vest within 60 days. |
| (2) | Mr. Lane resigned from his position effective March 15, 2024. Upon his departure, he forfeited any unvested long-term incentive awards. |
| (3) | Includes shares beneficially owned by executive officers as of the date of this proxy statement who are not individually listed in this table. Mr. Lane resigned from his position effective March 15, 2024, and his ownership is excluded from this amount. Mr. Guilfoyle ceased to be deemed an executive officer as of February 22, 2024, and his ownership is excluded from this amount. |
| 2024Proxy Statement | LyondellBasell | 87 |
We have adopted a written Related Party Transaction Approval Policy, which requires the disinterested members of the Audit Committee to review and approve certain transactions that we may enter into with related parties, including members of the Board, executive officers, and certain shareholders. The policy applies to any transaction:
| • | in the ordinary course of business with an aggregate value of $25 million or more; |
| • | not in the ordinary course of business, regardless of value; or |
| • | with a value of $120,000 or more and in which an executive officer or non-executive director has a direct or indirect material interest. |
Related party relationships are identified and disclosed on an ongoing basis, as well as through responses to annual questionnaires completed by all directors, director nominees, and executive officers.
The Audit Committee reviews all the relevant facts of each related party transaction, including the nature of the related person’s interest in the transaction, and determines whether to approve the transaction by considering, among other factors, (i) whether the terms of the transaction are fair to the Company and on the same basis as those which could be obtained from non-related parties, (ii) the business reasons for the Company to enter into the transaction, (iii) whether the related party transaction would impair the independence of any independent Board member, and (iv) whether the transaction would present an improper conflict of interest for any director or executive officer of the Company. No director votes on approval or, unless requested by the Audit Committee, participates in the discussion of a related party transaction in which he or she has an interest. The Audit Committee also conducts an annual review of all transactions with related parties, including those that do not meet the thresholds for related party transactions described above.
The following is a description of related party transactions in existence since the beginning of fiscal year 2023.
In 2010, we entered into certain agreements with affiliates of Access Industries, including a registration rights agreement, which obligates us to register and bear the costs for the resale of equity securities owned by Access Industries or its affiliates, and a nomination agreement. Pursuant to the nomination agreement, Access Industries has the right to nominate individuals for appointment to the Board if certain ownership thresholds are met. Access Industries currently owns more than 18% of our outstanding shares and has nominated Mr. Benet, Mr. Buchanan, and Ms. Kamsky pursuant to the nomination agreement. The Company entered into these agreements with Access Industries before it became publicly traded and the Related Party Transaction Approval Policy was adopted. Amendments to the nomination agreement are approved by disinterested directors.
Calpine Corporation, the owner and operator of power plants across the United States and Canada, supplies power and steam to the Company’s Houston refinery and is owned by a group of investors, including a minority investment by Access Industries. The Audit Committee has approved, most recently in October 2020, the Company’s contracts with Calpine, which were determined to be on terms fair to the Company and more advantageous than those offered by other parties. In 2023, the Company purchased approximately $67.3 million of power, steam, and water from Calpine and sold approximately $18.8 million of excess gas and raw water to Calpine.
The Board was also made aware of, and considered the fairness of, certain transactions and relationships between the Company and other organizations where our directors and director nominees have relationships. These transactions and relationships were also considered in evaluating the independence of our directors and director nominees. In particular, Mr. Buchanan, Ms. Kamsky and Ms. Karlin each served as directors or advisors of companies with which LyondellBasell had commercial transactions in 2023. Each of these transactions was entered into on an arm’s-length basis in the ordinary course of business, and no director initiated or participated in negotiation of the relevant purchases or sales or had any material interest in, or received any compensation in connection with, these transactions. In each case, the payments made or received by LyondellBasell fell below the greater of $1 million or 2% of the other company’s annual gross revenue.
| 2024Proxy Statement | LyondellBasell | 88 |
Name | Number of | Stock Options Exercisable Within 60 days | |
Shares | RSUs(1) | ||
Jacques Aigrain | 19,335 | — | — |
Lincoln Benet | 6,961 | — | — |
Jagjeet Bindra(2) | 14,652 | — | — |
Robin Buchanan | 27,615 | — | — |
Tony Chase | 2,283 | — | — |
Nance Dicciani | 29,269 | — | — |
Bob Dudley | 1,363 | — | — |
Claire Farley | 17,442 | — | — |
Rita Griffin | — | — | — |
Michael Hanley | 7,633 | — | — |
Virginia Kamsky | 556 | — | — |
Albert Manifold | 6,097 | — | — |
Peter Vanacker | — | — | — |
Ken Lane | 38,427 | — | 29,963 |
Michael McMurray | 32,012 | — | 154,092 |
Jim Guilfoyle | 29,850 | — | 102,638 |
Jeffrey Kaplan | 44,195 | — | 68,658 |
Torkel Rhenman | 31,122 | — | 77,409 |
ALL DIRECTORS, NOMINEES, AND EXECUTIVE OFFICERS AS A GROUP (24 PERSONS) | 360,375 | — | 498,913 |
(1) Represents RSUs (each equivalent to a share of LyondellBasell stock) that will vest within 60 days. (2) Includes 9,200 shares owned by the Bindra Family Revocable Trust. Mr. Bindra disclaims beneficial ownership of such shares except to the extent of any pecuniary interest therein. | |||
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Section 16(a) of the Exchange Act requires our directors, executive officers, and persons who own more than 10% of our common shares to file initial reports of ownership and reports of changes in ownership of common shares (Forms 3, 4, and 5) with the SEC and the NYSE. Reporting persons are required by SEC regulation to furnish us with copies of all such forms that they file.
Based on a review of the reports filed, information of the Company, and written representations from reporting persons, we believe that, during the fiscal year ended December 31, 2023, all of our directors, executive officers, and greater than 10% shareholders timely filed all reports they were required to file under Section 16(a), except for seven reports by Mr. Chase that were not timely filed due to an administrative error, reporting sales and purchases of shares made by a third-party broker that were not subject to the discretion of the reporting person. A Form 4 reporting these transactions was filed in July 2023 after the missed filings were identified, and all short-swing profits realized by Mr. Chase from the relevant transactions have been voluntarily disgorged.
| 2024Proxy Statement | LyondellBasell | 89 |
LYONDELLBASELL 2023 PROXY STATEMENT 80
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Our Board is soliciting your vote on voting matters submitted for approval at the Company’s 20232024 Annual General Meeting ofShareholders.
In accordance with Dutch law and the rules and regulations of the NYSE and the SEC, we are required to submit certain items for the approval of our shareholders. Several matters that are within the authority of a company’s board of directors under most U.S. state corporate laws require shareholder approval under Dutch law. Additionally, in accordance with Dutch corporate governance guidelines, we provide for the discussion at our Annual Meeting of certain topics that are not subject to a shareholder vote, including our governance practices and our dividend policy.
The discharge from liability of our directors, the adoption of our 20222023 Dutch statutory annual accounts, the appointment of the auditor for our 20232024 Dutch statutory annual accounts, the authorization to repurchase shares, and the cancellation of shares held in our treasury account are all items that we are required to submit to shareholders due to our incorporation in the Netherlands.
The Board of Directors recommends that you vote FOReach of the voting items presented in this proxy statement.
Unless you give other instructions on your proxy card, the persons named as proxy holders on the proxy card will vote in favor of each of the voting items in accordance with the recommendation of the Board of Directors.
You may vote your LyondellBasell shares at the Annual Meeting if you are the record owner of such shares as of the close of business on April 21, 202326, 2024 (the “Record Date”). You are entitled to one vote for each share of LyondellBasell common stock that you own. As of April1,2023, 2024, there were [__][ ] shares of LyondellBasell common stock outstanding and entitled to vote at the Annual Meeting.
Your shares are counted as present at the Annual Meeting if you held such shares as of the Record Date and (i) properly return a proxy by Internet, telephone, or mail or (ii) properly notify us of your intention to attend the Annual Meeting, attend the meeting, and vote in person. There are no quorum requirements under Dutch law and, as a result, we may hold our meeting regardless of the number of shares that are present in person or by proxy.
| 2024Proxy Statement | LyondellBasell | 90 |
The number of votes required to approve the matters presented in this proxy statement varies by item:
Pursuant to the Dutch Civil Code and our Articles of Association, the nomination of a candidate to our Board (Item 1) is binding on shareholders unless 2/3 of the votes cast at the Annual Meeting, representing more than 50% of the Company’s issued share capital (which for this purpose includes only our outstanding shares), vote against the nominee. This means that a nominee will be elected unless the votes against him or her constitute 2/3 of the votes cast and represent more than 50% of our issued share capital.
| • | Pursuant to the Dutch Civil Code and our Articles of Association, the nomination of a candidate to our Board (Item 1) is binding on shareholders unless 2/3 of the votes cast at the Annual Meeting, representing more than 50% of the Company’s issued share capital (which for this purpose includes only our outstanding shares), vote against the nominee. This means that a nominee will be elected unless the votes against him or her constitute 2/3 of the votes cast and represent more than 50% of our issued share capital. |
| • | Under Dutch law, the cancellation of shares held in our treasury account (Item 8) requires the affirmative vote of a majority of the votes cast at the Annual Meeting. If, however, less than 50% of the Company’s issued share capital (which for this purpose includes only our outstanding shares) is represented at the Annual Meeting, the proposal will require the affirmative vote of at least 2/3 of the votes cast. |
| • | Each other voting item set forth in this proxy statement requires the affirmative vote of a majority of the votes cast by shareholders in order to be approved. |
LYONDELLBASELL 2023 PROXY STATEMENT 81
Under Dutch law, the cancellation of shares held in our treasury account (Item 9) requires the affirmative vote of a majority of the votes cast at the Annual Meeting. If, however, less than 50% of the Company’s issued share capital (which for this purpose includes only our outstanding shares) is represented at the Annual Meeting, the proposal will require the affirmative vote of at least 2/3 of the votes cast.
Each other voting item set forth in this proxy statement requires the affirmative vote of a majority of the votes cast by shareholders in order to be approved.
You can vote by proxy without attending the meeting or in person at the meeting. To vote by proxy, you must vote over the Internet, by telephone, or by mail. Instructions for each method of voting are included on the proxy card.
If you hold your LyondellBasell shares in a brokerage account (that is, you hold your shares in “street name”), your ability to vote by telephone or over the Internet depends on your broker’s voting process. Please follow the directions on your proxy card or voter instruction form.
Even if you plan to attend the Annual Meeting, we encourage you to vote your shares by proxy in advance. If you plan to vote in person at the Annual Meeting and you hold your LyondellBasell shares in street name, you must obtain a proxy from your broker and bring that proxy to the meeting.
Yes. You can change or revoke your vote at any time before the polls close at the Annual Meeting. You can do this by:
Entering a new vote by telephone or over the Internet prior to 11:59 p.m. Eastern Time on May 17, 2023;
| • | Entering a new vote by telephone or over the Internet prior to 11:59 p.m. Eastern Time on May 22, 2024; |
| • | Signing another proxy card with a later date and returning it to us by a method that allows us to receive the proxy prior to the Annual Meeting; |
| • | Sending us a written document revoking your earlier proxy; or |
| • | Attending the Annual Meeting and voting your shares in person (attendance at the Annual Meeting will not, by itself, revoke a proxy previously given by you). |
Signing another proxy card with a later date and returning it to us by a method that allows us to receive the proxy prior to the AnnualMeeting;
Sending us a written document revoking your earlier proxy; or
Attending the Annual Meeting and voting your shares in person (attendance at the Annual Meeting will not, by itself, revoke a proxy previously given by you).
We have hired Broadridge Financial Solutions, Inc. to count the votes represented by proxies and cast by ballot at the Annual Meeting.
| 2024Proxy Statement | LyondellBasell | 91 |
If you do not provide a proxy or vote your shares in person, the shares held in your name will not be voted.
If you hold your shares in street name, your broker may be able to vote your shares for certain “routine” matters even if you do not provide the broker with voting instructions. We believe that, pursuant to NYSE rules, Item 3, Item 5, Item 87 and Item 98 are considered routine matters. Therefore, without instructions from you, your broker may not vote your shares with respect to Item 1, Item 2, Item 4, Item 6 and Item 7.6. It is therefore important that you act to ensure your shares are voted.
If a broker does not have discretion to vote shares held in street name on a particular voting item and does not receive instructions from the beneficial owner on how to vote those shares, the broker may return the proxy card without voting on that voting item. This is known as a broker non-vote. Broker non-votes will have no effect on the vote for any voting item properly introduced at the meeting.
If you return a signed proxy card without indicating your vote on all voting items listed, your shares will be voted FOR each of the voting items for which you did not vote.
LYONDELLBASELL 2023 PROXY STATEMENT 82
For all voting items other than the election of nominees to our Board of Directors, you may vote FOR, AGAINST, or ABSTAIN. For the voting item for the election of nominees (Item 1), you may vote FOR, AGAINST, or WITHHOLD with respect to each nominee. A vote to abstain or withhold does not count as a vote cast, and therefore will not have any effect on the outcome of any voting item to be voted on at the Annual Meeting.
No. All matters to be voted on at the Annual Meeting must be included as voting items in the agenda for the meeting as described in this proxy statement. We will provide shareholders with an opportunity to discuss our corporate governance, dividend policy, and executive compensation program. However, there will be no vote on any of these matters.
| 2024Proxy Statement | LyondellBasell | 92 |
The Annual Meeting is open to all LyondellBasell shareholders who hold shares as of the close of business on April 21, 2023,26, 2024, the Record Date.
If you would like to attend the Annual Meeting, you must inform us in writing of your intention to do so on or before May 12, 2023,17, 2024, oneweek prior to the date of the meeting. The notice may be emailed to CorporateSecretary@LyondellBasell.com. Additional information regarding the availability of and procedures for in person attendance at the Annual Meeting including pandemic health and safety protocols, will be provided to shareholders who provide timely notice of intent to attend and proper evidence of their ownership of LyondellBasellLYB shares as of the Record Date. Admittance of shareholders to the Annual Meeting will be governed by Dutch law.
If we determine that in-person attendance is not possible or advisable due to unanticipated circumstances at the time of the Annual Meeting, we will provide information regarding alternative access as soon as available.
The Company will pay the cost of soliciting proxies for the Annual Meeting. Our directors, officers, and employees may solicit proxies by mail, by email, by telephone, or in person for no additional compensation. In addition, we have retained Georgeson LLC to assist in the solicitation of proxies for a fee of $13,750,$15,000, plus reimbursement of reasonable expenses.
SEC rules permit us to deliver a single copy of our annual report and proxy statement to any household at which two or more shareholders reside, if we believe the shareholders are members of the same family.
If you prefer to receive your own copy of the proxy statement now or in future years, please request a duplicate set by phone at (800)579-1639, through the Internet at www.proxyvote.com, or by email to sendmaterial@proxyvote.com. If you hold your shares in street name, and you received more than one set of proxy materials at your address, you may need to contact your broker or nominee directly if you wish to discontinue duplicate mailings to your household.
We distribute our proxy materials to certain shareholders via the Internet using the “Notice and Access” approach permitted by rules of the SEC. This approach conserves natural resources and reduces our distribution costs, while providing our shareholders with a timely and convenient method of accessing the materials and voting. On or before April [__],[ ], 2023, we mailed a “Notice of Internet Availability of Proxy Materials” to participating shareholders, containing instructions on how to access the proxy materials on the Internet. In addition, we provided the notice and proxy materials by e-mail to certain shareholders who previously consented to electronic delivery of proxymaterials.
| 2024Proxy Statement | LyondellBasell | 93 |
LYONDELLBASELL 2023 PROXY STATEMENT 83
You can request to receive proxy materials for future meetings by e-mail by following the electronic delivery enrollment instructions at www.proxyvote.com. If your shares are held in street name, please contact your bank or broker for information on electronic delivery options.
If you choose to access future proxy materials electronically, you will receive an e-mail with instructions containing a link to the website where those materials are available and a link to the proxy voting website. Your election to access proxy materials by e-mail will remain in effect until terminated.
Our Articles of Association provide that a shareholder representing at least one percent of our issued share capital can submit an agenda item for consideration at the Company’s general meeting of shareholders. Any such request must be received at least 60 days prior to the date of the annual meeting.
Under SEC rules, if a shareholder wishes to include a proposal in our proxy materials for presentation at our 20242025 annual general meeting, the proposal must be received at our offices at LyondellBasell Industries, 4th4th Floor, One Vine Street, London W1J 0AH, United Kingdom, Attention: Corporate Secretary or sent to CorporateSecretary@LyondellBasell.com, by December [__], 2023.[ ], 2024. All proposals must comply with Rule 14a-8 under the Securities Exchange Act of 1934, as amended.
LYONDELLBASELL 2023 PROXY STATEMENT 84
BackThe deadline for providing notice of a solicitation of proxies in support of director nominees other than the Company’s nominees pursuant to ContentsRule 14a-19 for the Company’s 2025 annual meeting is March 25, 2025.
We reserve the right to reject, rule out of order, or take other appropriate action with respect to any proposal that does not comply with these or other applicable requirements, including requirements under Dutch law and our Articles of Association.
| 2024Proxy Statement | LyondellBasell | 94 |
This proxy statement makes reference to certain non-GAAP financial measures as defined in Regulation G of the U.S. Securities Exchange Act of 1934, as amended. We report our financial results in accordance with U.S. generally accepted accounting principles, but believe that certain non-GAAP financial measures, such as EBITDA and EBITDA exclusive of identified items, provide useful supplemental information to investors regarding the underlying business trends and performance of the Company’s ongoing operations and are useful for period-over-period comparisons of such operations. Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the financial measures prepared in accordance with GAAP.
EBITDA, as presented herein, may not be comparable to a similarly titled measure reported by other companies due to differences in the way the measure is calculated. We calculate EBITDA as income from continuing operations plus interest expense (net), provision for (benefit from) income taxes, and depreciation & amortization. EBITDA should not be considered an alternative to profit or operating profit for any period as an indicator of our performance, or as an alternative to operating cash flows as a measure of our liquidity. We also present EBITDA, exclusive of identified items. Identified items include adjustments for LCM,lower of cost or market (“LCM”), impairments and refinery exit costs. Our inventories are stated at the lower of cost or market. Cost is determined using the last-in, first-out (“LIFO”) inventory valuation methodology, which means that the most recently incurred costs are charged to cost of sales, and inventories are valued at the earliest acquisition costs. Fluctuation in the prices of crude oil, natural gas and correlated products from period to period may result in the recognition of charges to adjust the value of inventory to the lower of cost or market in periods of falling prices and the reversal of those charges in subsequent interim periods, within the same fiscal year as the charge, as market prices recover. Property, plant and equipment are recorded at historical costs. If it is determined that an asset or asset group’s undiscounted future cash flows will not be sufficient to recover the carrying value exceeds fair value,amount, an impairment charge is recognized to write the asset down to its estimated fair value. Goodwill is tested for impairment annually in the fourth quarter or whenever events or changes in circumstances indicate that the fair value of a reporting unit with goodwill is below its carrying amount. If it is determined that the carrying value of the reporting unit including goodwill exceeds its fair value, an impairment charge is recognized. We assess our equity investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. If the decline in value is considered to be other-than-temporary, the investment is written down to its estimated fair value. In April 2022 we announced our decision to cease operation of our Houston refinery no later than the end of 2023.refinery. In connection with exiting the refinery business, we incurredbegan to incur costs primarily consisting of accelerated lease amortization costs, personnel related costs, accretion of asset retirement obligations and depreciation of asset retirement costs.
Recurring annual EBITDA for the Value Enhancement Program is the year-end EBITDA run rate estimated based on 2017-2019 mid-cycle margins and modest inflation relative to a 2021 baseline. We believe recurring annual EBITDA is useful to investors because it represents a key measure used by management to assess progress towards our strategy of value creation.
| 2024Proxy Statement | LyondellBasell | 95 |
A reconciliation of net income to EBITDA, including and excluding identified items, for the years ended December 31, 2020, 2021, 2022 and 20222023 is shown in the following table:
| Year Ended December 31, | |||
(amounts in millions) |
| 2020 | 2021 | 2022 |
Net income | $ | 1,427 | 5,617 | 3,889 |
Loss from discontinued operations, net of tax |
| 2 | 6 | 5 |
Income from continuing operations |
| 1,429 | 5,623 | 3,894 |
Provision for income taxes |
| (43) | 1,163 | 882 |
Depreciation and amortization(a) |
| 1,385 | 1,393 | 1,267 |
Interest expense, net |
| 514 | 510 | 258 |
add: Identified items |
|
|
|
|
Lower of cost or market inventory valuation charges |
| 16 | — | — |
Impairments(b) |
| 582 | 624 | 69 |
Refinery exit costs(c) |
| — | — | 157 |
EBITDA excluding identified items |
| 3,883 | 9,313 | 6,527 |
less: Identified items |
|
|
|
|
Lower of cost or market inventory valuation charges |
| (16) | — | — |
Impairments(b) |
| (582) | (624) | (69) |
Refinery exit costs(c) |
| — | — | (157) |
EBITDA | $ | 3,285 | 8,689 | 6,301 |
Depreciation and amortization includes depreciation of asset retirement costs of $30 million expensed during the year ended December 31, 2022 in connection with exiting the Refining business.
LYONDELLBASELL 2023 PROXY STATEMENT A-1
The years ended December 31, 2020 and 2021 reflect impairment charges related to the Houston refinery. The year ended December 31, 2022 reflects impairment charges related to the sale of our Australian polypropylene business.
Refinery exit costs, include accelerated lease amortization costs of $91 million, personnel related costs of $64 million and accretion of asset retirement obligations of $2 million expensed during the year ended December 31, 2022.
| Year Ended December 31, | |||||
| (amounts in millions) | 2020 | 2021 | 2022 | 2023 | |
| Net income | $ | 1,427 | 5,617 | 3,889 | 2,121 |
| Loss from discontinued operations, net of tax | 2 | 6 | 5 | 5 | |
| Income from continuing operations | 1,429 | 5,623 | 3,894 | 2,126 | |
| (Benefit from) Provision for income taxes | (43) | 1,163 | 882 | 501 | |
| Depreciation and amortization(a) | 1,385 | 1,393 | 1,267 | 1,534 | |
| Interest expense, net | 514 | 510 | 258 | 348 | |
| EBITDA | 3,285 | 8,689 | 6,301 | 4,509 | |
| add: Identified items | |||||
| Lower of cost or market inventory valuation charges | 16 | — | — | — | |
| Impairments(b) | 582 | 624 | 69 | 518 | |
| Refinery exit costs(c) | — | — | 157 | 195 | |
| EBITDA excluding identified items | $ | 3,883 | 9,313 | 6,527 | 5,222 |
| (a) | Depreciation and amortization includes depreciation of asset retirement costs of in connection with exiting the Refining business. |
| (b) | The years ended December 31, 2020 and 2021 reflect non-cash impairment charges related to our Houston refinery. The year ended December 31, 2022 reflects a non-cash impairment charge related to the sale of our polypropylene manufacturing facility in Australia. The year ended December 31, 2023 reflects non-cash impairment charges of $518 million, which includes $192 million related to European PO joint venture assets in our Intermediates & Derivatives segment, recognized in the fourth quarter of 2023, and a non-cash goodwill impairment charge of $252 million in our Advanced Polymer Solutions segment, recognized in the first quarter of 2023. |
| (c) | Refinery exit costs include accelerated lease amortization costs, personnel related costs, and accretion of asset retirement obligations. |
A reconciliation of net income to recurring annual EBITDA for our value enhancement programthe Value Enhancement Program (“VEP”) is shown in the following table.table:
| (amounts in millions) | Original Target 2023(b) | Unlocked Value 2023(c) | Current Target 2025 | |
| Net income(a) | $ | 115 | 300 | 750 |
| Provision for income taxes | 25 | 75 | 185 | |
| Depreciation and amortization | 10 | 25 | 65 | |
| Interest expense, net | — | — | — | |
| Recurring annual EBITDA(a) | $ | 150 | 400 | 1,000 |
| (a) | Year-end run-rate based on 2017-2019 mid-cycle margins and modest inflation relative to 2021 baseline. |
| (b) | In 2022, we launched the Value Enhancement Program initially targeting $150 million in recurring annual EBITDA by the end of 2023. |
| (c) | In 2023, the program delivered a year-end run-rate of approximately $400 million of recurring annual EBITDA. |
| 2024Proxy Statement | LyondellBasell | 96 |
(amounts in millions) |
|
|
| 2025(a) Recurring Annual EBITDA |
Net income |
|
| $ | 575 |
Provision for income taxes |
|
| 140 | |
Depreciation and amortization |
|
| 35 | |
Interest expense, net |
|
|
| — |
EBITDA |
|
| $ | 750 |
| Back to Contents |
In 2022, we launched a value enhancement program targeting $750 million in recurring annual EBITDA by the end of 2025.
LYONDELLBASELL 2023 PROXY STATEMENT A-2
Item 1. Election of Directors
Pay for performance. We tie a significant amount of compensation to our financial, business, strategic, and ESG goals.
Excise tax gross-ups. We do not provide for excise tax gross-ups in connection with change-in-control events or terminations.