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Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (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

ConocoPhillips

(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


Table of Contents

2024 Proxy

Statement


Table of Contents

Table of Contents

A Message from Our Chairman and Chief Executive Officer and Lead Director 4
Notice of 2024 Annual Meeting of Stockholders 6
Proxy Summary 7
About ConocoPhillips 7
Stockholder Engagement 9
Director Nominees 10
Governance Highlights 12
Executive Compensation 13
Progress Report on Our Plan for the Net-Zero Energy Transition 14
FOR Item 1: Election of Directors and Director Biographies 16
 
Board Composition and Refreshment 33
Director Onboarding and Education 34
Board and Committee Evaluations 35
Corporate Governance at ConocoPhillips 36
Board Leadership Structure 36
Board Independence 38
Related Party Transactions 39
Board Meetings and Committees 40
Board Oversight of Risk Management 42
Stockholder Engagement and Board Responsiveness 45
Code of Business Ethics and Conduct 48
Commitment to Our Culture 48
Human Capital Management 49
Public Policy Engagement 52
Communications with the Board of Directors 53
Director Compensation 53
Audit and Finance Committee Report 60
FOR Item 2: Proposal to Ratify the Appointment of Ernst & Young LLP 62
 
FOR Item 3: Advisory Approval of Executive Compensation 64
 
Role of the Human Resources and Compensation Committee 65
Authority and Responsibilities 65
Members 65
Meetings 65
Compensation Discussion and Analysis 66
Executive Overview 67
Philosophy and Principles of Our Executive Compensation Program 73
Majority of Executive Compensation is Performance Based 74
Components of Executive Compensation 74
Process for Determining Executive Compensation 77
2023 Executive Compensation Analysis and Results 84
Other Executive Compensation and Benefits 93
Executive Compensation Governance 95
Human Resources and Compensation Committee Report 97
Human Resources and Compensation Committee Interlocks and Insider Participation 97
Executive Compensation Tables 98
Summary Compensation Table 98
Grants of Plan-Based Awards Table 101
Outstanding Equity Awards at Fiscal Year-End 103
Option Exercises and Stock Vested 105
Pension Benefits 105
Nonqualified Deferred Compensation 107
Executive Severance and Changes in Control 109
CEO Pay Ratio 115
Pay Versus Performance 116
Linking Pay and Performance 119
Stock Ownership 121
Holdings of Major Stockholders 121


Table of Contents

Securities Ownership of Officers and Directors 122
Equity Compensation Plan Information 123
Stockholder Proposals 125
FOR Item 4: Stockholder Proposal — Simple Majority Vote 125
 
AGAINST Item 5: Stockholder Proposal — Revisit Pay Incentives for GHG Emission Reductions 127
Submission of Future Stockholder Proposals and Nominations 129
Rule 14A-8 Stockholder Proposals 129
Proxy Access Nominations 129
Other Proposals/Nominations Under the Advance Notice By-Law 129
How to Reach Our Corporate Secretary 129
Available Information and Q&A About the Annual Meeting and Voting 130
Available Information 130
Attending the Annual Meeting 130
Stockholders of Record and Beneficial Stockholders: Know Which One You Are 131
Who Can Vote and How 132
Business to Take Place at the Meeting 134
Proxies 135
Ways to Get Our Proxy Statement and Annual Report 136
Appendix A 137
Non-GAAP Financial Measures 137
Non-GAAP Reconciliations 138
Other Measures 139
Stockholder Information 140
ConocoPhillips 2023 Notable Recognitions and Achievements 141



Cautionary Note Regarding Forward-Looking Statements

This document includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our ESG goals, commitments, and strategies, including our net-zero commitments and other ESG -related information. We use words such as “ambition,” “anticipates,” “believes,” “expects,” “future,” “goal,” “target,” “plan,” “must,” “will,” “should,” “aim,” “strive,” “intends,” and similar expressions to identify forward-looking statements. These statements involve risks and uncertainties. Actual results could differ materially from any future results expressed or implied by the forward-looking statements for a variety of reasons, including due to the risks and uncertainties that are discussed in our most recently filed periodic reports on Form 10-K and subsequent filings on Form 10-Qs, and Form 8-Ks. We assume no obligation to update any forward-looking statements or information, which speak as of their respective dates.

Incorporation by Reference

To the extent that this Proxy Statement has been or will be specifically incorporated by reference into any other filing of ConocoPhillips under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, the sections of this Proxy Statement titled “Audit and Finance Committee Report” (to the extent permitted by the rules of the U.S. Securities and Exchange Commission (SEC)) and “Human Resources and Compensation Committee Report” shall not be deemed to be so incorporated, unless specifically stated otherwise in such filing. This Proxy Statement includes website addresses and references to additional materials found on those websites, which are provided for convenience only. These websites and materials are not incorporated into this Proxy Statement by reference.


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A Message from Our Chairman and Chief Executive Officer and Lead Director

April 1, 2024

Dear Fellow Stockholders,

On behalf of the Board of Directors (the “Board”) and the Executive Leadership Team, we are pleased to invite you to participate in the 2024 Annual Meeting of Stockholders (the “Annual Meeting”). The meeting will take place virtually on Tuesday, May 14, 2024, at 9:00 a.m. Central Daylight Time. There will be no in-person meeting. The attached Notice of the 2024 Annual Meeting of Stockholders and Proxy Statement provides information about the business we plan to conduct.

A Compelling 10-Year Plan

At our 2023 Analyst & Investor Meeting, we reaffirmed our durable returns-focused value proposition with an updated 10-year financial plan that produces solid free cash flow, allowing us to reward stockholders now and into the future.

As we enter 2024, ConocoPhillips continues to be guided by our Triple Mandate, which sets out three objectives to align our actions with the underlying realities of our business and demonstrates our commitment to create long-term value for our stockholders. First, we must reliably and responsibly deliver oil and gas production to meet energy transition pathway demand. Second, we must deliver competitive returns on and of capital for our stockholders. Third, we must remain focused on achieving our net-zero operational emissions ambition. Our Triple Mandate underlies our clearly defined value proposition of delivering superior returns through price cycles based on our foundational principles of balance sheet strength, peer-leading distributions, disciplined investments, and responsible and reliable environmental, social and governance performance.

Continuing to Deliver on Each Pillar of The Triple Mandate

In 2023, we continued to deliver on each of the three mandates:

First, we achieved record full-year Lower 48 and total Company production, enhanced our diverse portfolio, and progressed our global LNG strategy.

In 2023, we delivered operationally across our diverse global portfolio with record full-year production of 1,826 MBOED. We continued to leverage technologies and operational excellence to improve drilling and completion efficiencies in the Lower 48 and across our assets. Our teams reached first production at several subsea tiebacks in Norway, Surmont Pad 267 in Canada and Bohai Phase 4B in China and achieved startup at the second phase of Montney’s central processing facility in Canada. We opportunistically acquired the remaining 50% working interest in Surmont at an attractive price that fits our financial framework. Long-life, low sustaining capital assets like Surmont play an important role in our low cost of supply portfolio. In addition, we reached final investment decision (FID) on Willow in Alaska, where we have over 50 years as a proven, responsible operator. Finally, we continued to advance our global LNG strategy through expansion in Qatar, FID at Port Arthur LNG, regasification agreements in the Netherlands and offtake agreements in Mexico. We now have equity, offtake, and regasification agreements across major global markets.

Second, we returned $11 billion to stockholders and maintained discipline on our cost of supply framework with a continued focus on returns on and of capital.

Full year 2023 earnings were $11.0 billion, or $9.06 per share, and our net cash provided by operating activities totaled $20.0 billion. We returned $11.0 billion to stockholders through our three-tier framework, including $5.6 billion through our ordinary dividend and variable return of cash and $5.4 billion in share repurchases. This is in excess of our annual through-the-cycle commitment to return greater than 30% of cash provided by operating activities to stockholders. In addition, across our portfolio we maintained discipline on our rigorous cost of supply framework to maximize our returns on capital. We are resolute in our efforts

           
  S

SAFETY
No task is so important that we can’t take the time to do it safely. A safe company is a successful company.

 
P

PEOPLE
We respect one another. We recognize that our success depends upon the capabilities and inclusion of our employees. We value different voices and opinions.

 
I

INTEGRITY
We are ethical and trustworthy in our relationships with internal and external stakeholders. We keep our promises.

 
R

RESPONSIBILITY
We are accountable for our actions. We care about our neighbors. Sustainability is core to our company and creates shared value for our stakeholders.

 
I

INNOVATION
We anticipate change and respond with creative solutions. We are responsive to the changing needs of the industry. We embrace learning. We are not afraid to try new things.

 
T

TEAMWORK
We have a “can do” attitude that inspires top performance from everyone. We encourage collaboration. We celebrate success. We win together.

 

4     ConocoPhillips


Table of Contents

A Message from Our Chairman and Chief Executive Officer and Lead Director

to maximize efficiencies and optimize well construction and completions designs to increase well recovery while minimizing incremental cost of supply. As an example, we achieved improvement of completion pumping efficiencies by 10% to 15% across our Lower 48 business segment.

Third, we accelerated our company’s greenhouse gas (GHG) emissions-intensity reduction target through 2030 and were recognized by the Oil & Gas Methane Partnership 2.0 for our methane reduction efforts.

In 2023, we demonstrated meaningful progress toward our Plan for the Net-Zero Energy Transition, including by accelerating our Scope 1 and 2 GHG emissions-intensity reduction target from 40-50% to 50-60% gross operated emissions, using a 2016 baseline. We allocated a portion of our budget for projects to reduce our Scope 1 and 2 emissions intensity and advance low carbon opportunities, including carbon capture and storage. In addition, we are in our second year of membership in the Oil & Gas Methane Partnership 2.0 (OGMP 2.0) initiative, which seeks to improve industry transparency in methane emissions reporting and encourage progress in reducing those emissions. We were awarded the OGMP 2.0’s Gold Standard Pathway designation in recognition of our ambitious multi-year measurement-based reporting plan which goes beyond current regulatory requirements. Additionally, 2023 marked the first year that Energy Transition Milestones were included as a standalone metric in our Variable Cash Incentive Program, further demonstrating our commitment to our net-zero operational emissions ambitions, by directly tying our performance on the Energy Transition Milestones to our compensation.

Looking to the Future

Now and into the future, we are focused on operational excellence with a proven track record of strong returns. Our strategy is differential, and we believe our portfolio is the deepest, most durable and diverse of any of our peers. In addition, we are well positioned for the energy transition. Safety remains a critical part of our culture, and we prioritize the safety of both our colleagues and communities. That means continuously looking for ways to operate more safely, efficiently, and responsibly, with a focus on reducing human error. We understand that this is a fundamental part of our license to operate.

Your input is valued and your vote is very important.

We strongly believe that regular engagement with all stakeholders — stockholders, employees, customers, suppliers, advocacy groups, governments, and communities — is critical to our long-term success. The Annual Meeting is an opportunity for stockholders to express their views on ConocoPhillips’ business.

Whether or not you plan to participate in the Annual Meeting, and no matter how many shares you own, we encourage you to vote in advance. Your vote is important to us and to our business. Prior to the meeting, you may sign and return your proxy card, use telephone or Internet voting, or visit the Annual Meeting website at www.conocophillips.com/annualmeeting to register your vote. Voting instructions begin on page 132.

Thank you for your continued support.

Ryan M. Lance
Chairman and Chief Executive Officer

      Robert A. Niblock
Lead Director

2024 Proxy Statement     5


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Notice of 2024 Annual Meeting of Stockholders

PROPOSALS REQUIRING YOUR VOTE

Purpose Board
Recommendation
Page
1 Election of 12 Directors FOR each nominee 16
2 Ratification of Independent Registered Public Accounting Firm FOR 62
3 Advisory Approval of the Compensation of Our Named Executive Officers FOR 64
4 Stockholder Proposal – Simple Majority Vote FOR 125
5 Stockholder Proposal – Revisit Pay Incentives for GHG Emission Reductions AGAINST 127

Only stockholders of record at the close of business on March 18, 2024 will be entitled to receive notice of, and to vote at, the Annual Meeting. A list of stockholders entitled to vote at the Annual Meeting will be available for inspection by any stockholder at our offices in Houston, Texas during ordinary business hours for a period of 10 days prior to the meeting.

Visit our Annual Meeting website at www.conocophillips.com/annualmeeting to learn more about our Annual Meeting, review and download this Proxy Statement and our Annual Report on Form 10-K for the year ended December 31, 2023 (the “Annual Report”), submit questions in advance of the Annual Meeting, and sign up for electronic delivery of materials for future annual meetings.

April 1, 2024
By Order of the Board of Directors

Kelly B. Rose
Corporate Secretary

DATE & TIME
Tuesday, May 14, 2024
9:00 a.m. (CDT)
   
LOCATION
Online at
www.virtualshareholdermeeting.com/COP2024
   
RECORD DATE
March 18, 2024
   

PARTICIPATE IN THE FUTURE OF CONOCOPHILLIPS—
VOTE NOW

ONLINE
Use your smartphone or computer.
www.proxyvote.com
   
PHONE CALL
Dial (800) 690-6903 toll-free 24/7.
   
MAIL
Cast your ballot, sign your proxy card, and send by mail in the enclosed postage-paid envelope.
   
ANNUAL MEETING
You may participate in the Annual Meeting and vote electronically.
   

Your vote is very important to us and to our business. Even if you plan to attend the Annual Meeting, please vote right away. For more information on voting, please see “Available Information and Q&A About the Annual Meeting and Voting” beginning on page 130.

Important Notice Regarding the Availability of Proxy Materials for the 2024 Annual Meeting of Stockholders to be held on May 14, 2024: This Proxy Statement and our 2023 Annual Report are available at www.conocophillips.com/annualmeeting.

6     ConocoPhillips


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Proxy Summary

This summary highlights information contained elsewhere in this Proxy Statement. This summary does not contain all of the information that you should consider, and you should read the entire Proxy Statement carefully before voting. For more complete information regarding ConocoPhillips’ 2023 performance, please review our Annual Report.

About ConocoPhillips

Company Overview

ConocoPhillips is one of the world’s leading exploration and production companies based on both production and reserves, with a globally diversified asset portfolio. Headquartered in Houston, Texas, as of December 31, 2023, ConocoPhillips had operations and activities in 13 countries, $96 billion of total assets, and approximately 9,900 employees. Production averaged 1,826 thousand barrels of oil equivalent per day (“MBOED”) in 2023, and proved reserves were 6.8 billion barrels of oil equivalent (“BBOE”) as of December 31, 2023. We explore for, produce, transport, and market crude oil, bitumen, natural gas, NGLs and LNG on a worldwide basis. Our diverse, low cost of supply portfolio includes resource-rich unconventional plays in North America; conventional assets in North America, Europe, Africa and Asia; LNG developments; oil sands in Canada; and an inventory of global exploration prospects.

CONOCOPHILLIPS IS ONE OF THE WORLD’S LEADING E&P COMPANIES BASED ON BOTH PRODUCTION AND RESERVES, WITH A GLOBALLY DIVERSIFIED ASSET PORTFOLIO.

2023 Global Operations
and Activities
      Employees       2023 Production       2023 Proved Reserves
13            
Countries as of
Dec. 31, 2023
~9,900       
as of Dec. 31, 2023
1,826       
MBOED
6.8           
Billion BOE

2024 Proxy Statement     7


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Proxy Summary

Executing on our Returns-Focused Value Proposition Delivers Strong Financial and Operational Performance

Throughout 2023, ConocoPhillips demonstrated that we can deliver strong financial and operational performance consistent with our value proposition of superior returns to stockholders through price cycles while executing against our Triple Mandate to reliably and responsibly deliver oil and gas production to meet energy transition pathway demand, deliver competitive returns on and of capital to our stockholders, and focus on achieving our net-zero operational emissions ambitions.

We delivered full year total and Lower 48 record production of 1,826 thousand barrels and 1,067 thousand barrels of oil equivalent per day, respectively, while we continued to enhance our portfolio diversity by opportunistically acquiring the remaining 50% working interest in Surmont, reaching FID on the Willow project in Alaska and further progressing our global LNG strategy.
We achieved a 17 percent return on capital employed(1) and we delivered competitive returns of capital by distributing $11 billion to stockholders through our three-tier framework, including $5.6 billion in cash through the ordinary dividend and variable return of cash (“VROC”) and $5.4 billion through share repurchases.
We continued to demonstrate our commitment to our net-zero operational emissions ambition by accelerating our GHG emissions-intensity reduction target through 2030 from 40-50% to 50-60%(2) and we were awarded the Oil & Gas Methane Partnership 2.0 Gold Standard Pathway designation.

We continue to be guided by our SPIRIT Values and remain committed to our foundational principles — focusing on peer-leading distributions, maintaining a strong balance sheet, executing disciplined investment, and demonstrating responsible and reliable ESG performance. Supporting these core principles are our strategic cash flow allocation priorities: (1) invest enough capital to sustain production and pay the existing dividend; (2) grow the dividend annually; (3) maintain ‘A’ credit rating; (4) return greater than 30 percent of cash from operations to stockholders; and (5) make disciplined investments to enhance returns.

A summary of the many important accomplishments we achieved in 2023 is shown below:

2023 HIGHLIGHTS — DELIVERING ACROSS ALL ELEMENTS OF THE TRIPLE MANDATE
STRATEGY FINANCIAL OPERATIONS
Acquired remaining 50% working interest in Surmont
Progressed LNG strategy through expansion in Qatar, FID at PALNG, and regasification agreements in the Netherlands and offtake agreements in Mexico
Awarded Gold Standard Pathway designation by OGMP 2.0
Accelerated GHG emissions-intensity reduction target through 2030(2)
 
Distributed $11B to stockholders; $5.6B in ordinary dividend and VROC and $5.4B in share repurchases
$11.0B earnings; $9.06 EPS; $10.6B adjusted earnings; $8.77 adjusted EPS(1)
Generated cash provided by operating activities of $20.0B; $21.3B CFO(3); $10.1B FCF(1); ending cash of $6.9B(4)
Announced 2024 expected return of capital of $9.0B
Delivered FY company and Lower 48 record production of 1,826 MBOED and 1,067 MBOED, respectively
Took FID on the Willow project
Achieved first production on projects in Norway, China and Canada
Improved completion pumping efficiencies by 10-15% across the Lower 48
(1) Adjusted earnings, adjusted EPS, return on capital employed (ROCE), and free cash flow (FCF) are non-GAAP measures. Further information related to these measures as well as reconciliations to the nearest GAAP measure are included in Appendix A.
(2) Using a 2016 baseline.
(3) Cash provided by operating activities was ~$20.0B. Excluding operating working capital change of ~($1.4B), cash from operations (CFO) was over $21.3B. CFO is a non-GAAP measure. Further information related to this measure is included in Appendix A.
(4) Ending cash includes cash, cash equivalents, and restricted cash totaling $5.9B and short-term investments of $1.0B. Restricted cash was $0.3B. Balance excludes $1.0B in long-term investments.

8     ConocoPhillips


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Proxy Summary

We maintained our ongoing practice of engaging with stockholders throughout 2023 and received consistent feedback that our disciplined, returns-focused strategy is the right one for our business and that our stockholders appreciate our ongoing efforts to increase the transparency and robustness of our disclosures to address the things that they care about most.

Stockholder Engagement

ConocoPhillips understands the importance of maintaining a robust stockholder engagement program. During 2023, ConocoPhillips continued this long-standing practice. Executives and management from our investor relations, sustainable development, human resources, government affairs, and legal groups routinely engaged with stockholders on a variety of topics, including our strategy and value proposition, corporate governance, executive compensation, human capital management, culture, climate change, and sustainability. When appropriate, directors also met with stockholders. We spoke with representatives from our top institutional investors, mutual funds, public pension funds, labor unions, and socially responsible funds to hear their views on these important topics. Overall, investors expressed strong support for ConocoPhillips. We believe our regular stockholder engagement was productive and provided an open exchange of ideas and perspectives for both ConocoPhillips and our stockholders. For more information, see “Stockholder Engagement and Board Responsiveness” beginning on page 45 and “2023 Say on Pay Vote Result, Stockholder Engagement, and Board Responsiveness” beginning on page 69.

2024 Proxy Statement      9


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Proxy Summary

Director Nominees

The Board recommends a vote FOR each of the 12 nominees listed below. All of the nominees are currently serving as directors.

10     ConocoPhillips


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Proxy Summary

2024 Proxy Statement     11


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Proxy Summary

Governance Highlights

Our Board oversees the development and execution of our strategy. We have robust governance practices and procedures that support our strategy. To maintain and enhance independent oversight, our Board is focused on its composition and effectiveness and has implemented a number of measures for continuous improvement.

The measures outlined below align our corporate governance structure with our strategic objectives and enable the Board to effectively communicate and execute our culture of compliance and rigorous risk management.

COMPREHENSIVE, INTEGRATED GOVERNANCE PRACTICES

Our Board is committed to regular renewal and refreshment, and we continually assess whether our composition appropriately relates to ConocoPhillips’ current and evolving strategic needs. See “Board Composition and Refreshment” beginning on page 33.
In assessing Board composition, the Committee on Directors’ Affairs considers any planned retirements from the Board, as well as background and diversity (including gender, ethnicity, race, national origin, and geographic background).
As a result, we have an experienced and diverse group of nominees. See “How Are Nominees Selected?” beginning on page 16.
The Board balances its commitment to maintaining institutional knowledge with the need for fresh perspectives that board refreshment and director succession planning provide.
Our Board’s thorough onboarding and director education processes complement our recruitment process. See “Director Onboarding and Education” beginning on page 34.
Our independent Lead Director’s robust duties are set forth in our Corporate Governance Guidelines. See “Board Leadership Structure” beginning on page 36.
Our non-employee directors meet privately in executive session at each regularly scheduled Board meeting.
Our Board reviews CEO and senior management succession and development plans at least annually and assesses candidates during Board and committee meetings and in less formal settings.
Our Board and committees conduct intensive and thoughtful annual evaluations of the Board, its committees, and its directors, including self-evaluations and peer assessments. See “Board and Committee Evaluations” on page 35.
Our directors provide feedback on Board and committee effectiveness, including areas such as Board composition and the Board/management succession-planning process.
Our Board regularly assesses its leadership structure.
Our Board’s decision-making is informed by input from stockholders.

 
The governance best practices we have adopted support
these general principles:
  
      
   
Annual election of all directors
Long-standing commitment to sustainability
Stock ownership guidelines for directors and executives
Independent Audit and Finance, Human Resources and Compensation, Public Policy and Sustainability, and Directors’ Affairs committees
Transparent public policy engagement
Prohibition on pledging and hedging for all employees
 
Proxy access
Active stockholder engagement
Majority independent Board
Executive sessions of non-employee directors held at each regularly scheduled Board meeting
Empowered independent Lead Director
Majority vote standard in uncontested elections
Clawback Policy
 

12     ConocoPhillips


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Proxy Summary

Executive Compensation

Compensation Designed Around our Strategy and Informed by Stockholder Feedback

Our executive compensation programs and metrics are aligned with our Triple Mandate and directly tie to our strategic priorities (see page 72). The following chart summarizes the principal components of our executive compensation program (percentages are shown for each component of our CEO’s 2023 target compensation).

Each year the HRCC, advised by its independent compensation consultant and informed by feedback from stockholders, undertakes a rigorous process to review our programs. The HRCC believes a substantial portion of our executive compensation should be equity-based and focused on rewarding long-term performance and furthermore, that this approach most closely aligns the interests of our top executives with those of our stockholders (see page 67).

Compensation and Governance Practices

Through our robust process described under the heading “HRCC Annual Compensation Cycle” on page 78, the HRCC has adopted strong governance practices consistent with the market, some of which are summarized below.

 
WHAT WE DO
  Executive compensation aligned with stockholder interests and primarily performance based (see pages 72 & 74)
  “Double trigger” vesting after a change in control for long-term incentive awards (see page 94)
  Significant stock ownership guidelines (see page 95)
  Payouts capped on executive incentive programs
  ESG and Human Capital metrics tied to executive and employee compensation (see page 82)
  Executives’ incentive compensation subject to clawback policy (see page 95)
 
WHAT WE DON’T DO
  No excise tax gross-ups for change in control plan participants
  No current payment of dividend equivalents on unvested long-term incentives for executives
  No repricing of stock options
  No pledging, hedging, short sales, or derivative transactions
  No employment agreements for our named executive officers (“NEOs”)
  Don’t reward executives for excessive, inappropriate or unnecessary risk-taking

2024 Proxy Statement     13


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Progress Report on Our Plan for the Net-Zero Energy Transition

Since publishing our Plan for the Net-Zero Energy Transition (our “Plan”), we have continued to focus on implementing our Climate Risk Strategy and advancing the Plan’s objectives. Our commitment to these efforts is demonstrated by our achievements made to date — many of which have been completed ahead of schedule. As we achieve our goals, we fine-tune our strategy and refine our commitments through ongoing engagement with our key stakeholders.

The table below provides an update on how we are progressing against our Plan, including demonstrating our progress and achievements in maintaining strategic flexibility, reducing Scope 1 and 2 emissions, addressing Scope 3 emissions and contributing to the energy transition.

2023 PROGRESS REPORT

Continued focus on resilient low cost of supply and low GHG intensity resources that meet energy transition pathway demand.
Published a new net-zero scenario modeling the collective global government and societal actions that would be required to align with limiting warming to 1.5 degrees.
Reduced methane intensity by ~70% since 2015.
Progressing toward near-zero methane intensity by 2030 (1.5 kg CO2e/BOE or approximately 0.15% of natural gas produced).
Participated in OGMP 2.0 to improve methane measurement and reporting transparency and achieved the Gold Standard Pathway for emissions reporting.
Invested in LongPath Technologies, a scalable laser-based continuous emissions monitoring solution with the potential to cover targeted assets or provide basin-wide multi-operator coverage.
On schedule to meet the World Bank Zero Routine Flaring goal by the end of 2025.(1)
Developing total flaring intensity target for 2030.
Accelerated our Scope 1 and 2 GHG emissions intensity reduction target through 2030 from 40-50% to 50-60%, using a 2016 baseline for both gross operated and net equity emissions.
Completed our approved Scope 1 and 2 emissions reductions projects and advanced low carbon opportunities within the allotted capital and cost budget.
Participated in a Ceres-led Roundtable to discuss solutions for reaching net-zero emissions with cross-sector participation from the financial sector and exploration and production (E&P) oil and gas companies.
Expanded third-party limited assurance to all sustainability disclosures in our Sustainability Report.
Continued to strengthen sustainability reporting processes, controls and assurance to prepare for pending disclosure requirements.
Chaired a National Petroleum Council study on GHG emissions reduction across the U.S. natural gas value chain.
Developed guidelines for company participation in the voluntary carbon market including due diligence requirements.
Increased our investment in the Climate Asset Management Carbon Fund.
Continued to evaluate a wide range of future offset projects and funds to possibly diversify our portfolio.
(1) Per the World Bank’s Zero Routine Flaring by 2030 Initiative Text, “Oil companies that endorse the Initiative will develop new oil fields they operate according to plans that incorporate sustainable utilization or conservation of the field’s associated gas without routine flaring. Oil companies with routine flaring at existing oil fields they operate will seek to implement economically viable solutions to eliminate this legacy flaring as soon as possible, and no later than 2030.”

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Progress Report on Our Plan for the Net-Zero Energy Transition

Expanded policy advocacy beyond carbon pricing to include energy efficiency, end-use emissions policy and regulatory action such as direct federal regulation of methane, and national policy recommendations on natural gas across the value chain.
Carbon pricing is the most effective and predictable policy action to reduce GHG emissions across the economy, so ConocoPhillips continues working with World Bank’s Carbon Pricing Leadership Coalition as a private sector partner to share and expand the evidence base for effective carbon pricing in addition to our continued support of the Climate Leadership Council and Americans for Carbon Dividends in the U.S.
Hosted annual Supplier Sustainability Forum with a focus group of suppliers to identify opportunities to reduce emissions in our value chain.
Collaborated with industry groups and third-party partners to align on collection, reporting and supplier engagement for supplier emissions.
Secured regasification capacity at the Gate LNG terminal in the Netherlands.
Secured 5 MTPA of LNG offtake along with 30% equity in Sempra’s Port Arthur LNG Phase 1 project on the U.S. Gulf Coast which began construction in March.
Signed offtake agreements at Mexico Pacific’s Saguaro LNG and Energia Costa Azul export facility on the west coast of Mexico.
Continued evaluation of potential opportunities to develop carbon capture and storage (CCS) hubs along the U.S. Gulf Coast.
Participating in Canada’s Oil Sands Pathways Alliance working toward net-zero operational emissions by 2050 through CCS.
Completed an equity investment in Avnos, a hybrid direct air capture innovator, and began evaluating the technology for project development.
Evaluating the development of blue and green ammonia as a low-carbon power generation fuel from the U.S. Gulf Coast with Japanese energy company JERA.

We acknowledge the findings of the Intergovernmental Panel on Climate Change that GHG emissions from the use of fossil fuels contribute to increases in global temperatures. We acknowledge the importance that science places on limiting global average temperature increases to below 2-degree Celsius compared to pre-industrial times, and to achieve that, science shows that global GHG emissions need to reach net-zero in the second half of this century. We support the Paris Agreement as a welcomed global policy response to that challenge.
We have had a public global climate change position since 2003. The position is reviewed periodically, agreed to by the Executive Leadership Team, and then recommended to the Board.

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Item 1: Election of Directors and Director Biographies

What am I Voting On?  
 
You are voting on a proposal to elect the 12 nominees named in this Proxy Statement to one-year terms as ConocoPhillips directors.

What is the makeup of the Board of Directors and how often are the members elected?

Our Board currently has 12 members. Directors are elected at the annual stockholder meeting each year. Any vacancy on the Board created between annual stockholder meetings (if, for example, a current director resigns or the size of the Board is increased) may be filled by a majority vote of the remaining directors then in office. Any director appointed to fill a vacancy would hold office until the next election.

Under our Corporate Governance Guidelines, directors generally may not stand for reelection after they reach the age of 72.

What if a nominee is unable or unwilling to serve?

All director nominees have consented to serve. However, should a director become unable or unwilling to serve before the date of the Annual Meeting and should the Board not elect to reduce the size of the Board, shares represented by proxies may be voted for a substitute nominated by the Board.

How are directors compensated?

Please see our discussion of director compensation beginning on page 53.

How are nominees selected?

The Committee on Directors’ Affairs regularly evaluates the size and composition of the Board and continually assesses whether the composition appropriately relates to ConocoPhillips’ strategic needs, which change as the business environment evolves. We seek director candidates who possess the highest personal and professional ethics, integrity, and values and who are committed to representing the long-term interest of all ConocoPhillips’ stakeholders. As some directors approach retirement age, the Committee on Directors’ Affairs seeks to onboard new directors to backfill the needed skills and experience of outgoing directors with sufficient overlap in service to allow for the transfer of institutional knowledge and sharing of experiences.

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The chart below shows our process for identifying and integrating new directors.

HOW WE SELECT AND ONBOARD/INTEGRATE NEW BOARD MEMBERS

Our Corporate Governance Guidelines contain director independence standards consistent with the standards prescribed in the NYSE Listed Company Manual and provide that, at all times, at least a substantial majority of the Board must meet those standards. The Committee on Directors’ Affairs also seeks to ensure that the Board reflects a range of talents, ages, skills, personal attributes, and expertise — particularly in the areas of leadership and management, financial reporting, issues specific to oil-and gas-related industries, both domestic and international markets, public policy and government regulation, technology, public company board service, human capital management, and environmental and sustainability matters — sufficient to provide sound and prudent guidance with respect to ConocoPhillips’ strategic needs. The Board seeks to maintain a diverse membership and also requires that its members be able to dedicate the time and resources necessary to ensure the diligent performance of their duties, including attending Board and applicable committee meetings. To that end, the Committee on Directors’ Affairs considers the number of other boards on which each candidate already serves. Non-employee directors may not serve on more than four other boards of publicly-traded companies in addition to the Board, and ConocoPhillips' Chief Executive Officer may not serve on the board of more than one other publicly-traded company. Directors should seek approval from the Chair of the Board and the Chair of the Committee on Directors’ Affairs in advance of accepting an invitation to serve on another public company board.

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The following are some of the key qualifications and skills the Committee on Directors’ Affairs considered in evaluating the director nominees. The chart on the next page shows how these qualifications and skills are distributed among our nominees. The individual biographies beginning on page 21 provide additional information about how each nominee’s specific experiences, qualifications, and skills align with and further the strategic direction of ConocoPhillips.

CEO OR SENIOR OFFICER FINANCIAL REPORTING INDUSTRY
We believe that directors with CEO or senior officer experience provide valuable insights. These individuals have a demonstrated record of leadership and a practical understanding of organizations, processes, strategy, risk and risk management, and the methods to drive change and growth. Through their service as top leaders at other companies, they also bring valuable perspectives on common issues affecting large and complex organizations. We measure operating and strategic performance by reference to financial targets. In addition, accurate financial reporting and robust auditing are critical to ConocoPhillips’ success. Accordingly, we seek to have a number of directors who could qualify as audit committee financial experts (as defined by SEC rules), and we expect all of our directors to be financially knowledgeable. We also believe it is important to have knowledge and experience in capital markets, both debt and equity, given our position as a large publicly traded company. We seek to have directors with significant experience in the energy industry. These directors have valuable perspective on issues specific to our business.
GLOBAL REGULATORY/GOVERNMENT TECHNOLOGY
As a global energy company, our future success depends, in part, on how we grow our businesses outside the United States. Directors with global business or international experience provide valued perspectives on our operations. The perspectives of directors who have experience within the regulatory field are important. The energy industry is heavily regulated and directly affected by governmental actions and decisions, and we believe that directors with government experience offer valuable insight in this regard. Experience or expertise in information technology helps us pursue and achieve our business objectives. Leadership and understanding of technology, cybersecurity risk, cloud computing, scalable data analytics, and big data technologies add exceptional value to our Board as we increasingly utilize our global data assets to monitor and optimize our operations.
PUBLIC COMPANY
BOARD SERVICE
ENVIRONMENTAL/
SUSTAINABILITY
HUMAN CAPITAL
MANAGEMENT
ConocoPhillips aspires to the highest standards of corporate governance and ethical conduct. Service on the boards and board committees of other large, publicly traded companies provides an understanding of corporate governance practices and trends and insights into: (1) board management; (2) relations between the Board, the CEO, and senior management; (3) agenda setting; and (4) succession planning. We believe this experience supports our goals of strong board and management accountability, transparency, and protection of stockholder interests. Our sustainable development approach is integrated into ConocoPhillips’ planning and decision-making. Directors who have experience with sustainability, including through leadership roles in our industry, strengthen the Board’s oversight and ensure that strategic business essentials and long-term value creation for stockholders are achieved with a responsible, sustainable business model which fosters a stable and healthy environment for tomorrow and proactively addresses stakeholder interests. We could not execute our differential strategy without employees, which is why we value directors with experience in effectively engaging, developing, retaining, and rewarding employees and with experience in diversity, equity, and inclusion management.

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Item 1: Election of Directors and Director Biographies

NOMINEE SKILLS MATRIX

Nominee Skills
Nominees and Primary Occupation Other Current U.S. Public
Company Directorships
Dir.
Since
Age* Ind.
Dennis V. Arriola
Former Chief Executive
Officer, Avangrid, Inc.
Commercial Metals Company
Meritage Homes Corporation
2022 63
Gay Huey Evans CBE
Former Chairman, London
Metal Exchange
S&P Global Inc.
2013 69
Jeffrey A. Joerres
Former Executive Chairman
and Chief Executive Officer,
ManpowerGroup Inc.
Artisan Partners Asset Management Inc.
The Western Union Company
2018 64
Ryan M. Lance
Chairman and Chief
Executive Officer,
ConocoPhillips
Freeport-McMoRan, Inc.
2012 61
Timothy A. Leach
Advisor to the Chief
Executive Officer,
ConocoPhillips
2021 64
William H. McRaven
Retired U.S. Navy Four-Star
Admiral (SEAL)
2018 68
Sharmila Mulligan
Former Chief Strategy
Officer, Alteryx
2017 58
Eric D. Mullins
Chairman and Chief Executive
Officer, Lime Rock Resources
Valero Energy Company
2020 61
Arjun N. Murti
Partner, Veriten LLC
2015 55
Robert A. Niblock
Lead Director
Former Chairman, President,
and Chief Executive Officer,
Lowe’s Companies, Inc.
Lamb Weston Holdings, Inc.
PNC Financial Services Group, Inc.
2010 61
David T. Seaton
Former Chairman and Chief
Executive Officer, Fluor
Corporation
The Mosaic Company
2020 62
R.A. Walker
Former Chairman and Chief
Executive Officer, Anadarko
Petroleum Corporation
2020 67
* As of April 1, 2024

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Item 1: Election of Directors and Director Biographies

Generally, the Committee on Directors’ Affairs identifies candidates through business and organizational contacts of the directors and management, though third-party search firms occasionally assist as well. Stockholders are also welcomed to recommend director candidates for consideration. If you wish to recommend a candidate for nomination to the Board, please follow the procedures described under “Submission of Future Stockholder Proposals and Nominations” on page 129 for nominations made directly by a stockholder. Candidates recommended by stockholders are evaluated on the same basis as all other candidates.

What vote is required to approve this proposal?

Each nominee requires the affirmative vote of a majority of the votes cast at the Annual Meeting; the number of votes cast “for” a director must exceed the number of votes cast “against” that director. In a contested election (if the number of nominees exceeded the number of directors to be elected), directors would be elected by a plurality of the shares represented at the meeting and entitled to vote on the election of directors.

What if a Director Nominee does not receive a majority of the votes cast?

If a nominee who is serving as a director is not elected at the Annual Meeting and no one else is elected in place of that director, then, under Delaware law, the director continues to serve on the Board as a “holdover director.” However, under our By-Laws, a holdover director is required to tender a resignation to the Board. The Committee on Directors’ Affairs then would consider the resignation and recommend to the Board whether to accept or reject it or whether some other action should be taken. The Board would then make a decision, without participation by the holdover director. The Board is required to disclose publicly (by a news release, filing with the SEC, or other broadly disseminated means of communication) its decision regarding the tendered resignation and the rationale behind that decision within 90 days from the date the election results are certified.

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Item 1: Election of Directors and Director Biographies

Who are this year’s Director Nominees?

The following 12 directors are standing for election to hold office until the 2025 Annual Meeting of Stockholders. Each of the director nominees is a current director. Committee membership is effective as of May 13, 2024.

Dennis V. Arriola
Former Chief Executive Officer, Avangrid, Inc.
Age: 63
Director Since: September 2022
ConocoPhillips Committees:

Mr. Arriola is an Operating Partner at Sandbrook Capital. He previously served as Chief Executive Officer of Avangrid, Inc. from 2020 until 2022. He joined Avangrid from Sempra Energy, a publicly traded energy infrastructure company, where he served as executive vice president and group president, and chief sustainability officer. Throughout his career, Mr. Arriola has served in a broad range of leadership positions in gas and electric utilities as well as renewables, including as chairman, president and chief executive officer of Southern California Gas Co., senior vice president and chief financial officer of both San Diego Gas & Electric and Southern California Gas Co., vice president of communications and investor relations for Sempra, and regional vice president and general manager of Sempra’s South American operations.

Mr. Arriola serves on the board of directors of Meritage Homes, Commercial Metals Company, and the Automobile Club of Southern California. He previously served on the boards of Avangrid, Inc., the California Latino Economic Institute, the U.S. Chamber of Commerce, the California Business Roundtable, the Edison Electric Institute, and the boards of several Sempra operating companies, including Infraestructura Energética Nova, a publicly traded company in Mexico, Luz del Sur SAA, a publicly traded company in Peru, and Chilquinta Energía in Chile.

Skills and Qualifications:

Mr. Arriola’s extensive experience in the energy sector, including leadership positions in companies with global operations in gas and electric utilities as well as renewables, brings valuable perspective to the Board. The Board believes that his career experience, including in sustainability, will greatly enhance the Board’s ability to guide ConocoPhillips in executing its strategy.

Other current U.S. public company directorships:

Commercial Metals Company
Meritage Homes Corporation

CEO or senior officer      Financial reporting      Industry
Global Regulatory/government Public company board service
Environmental/sustainability Human capital management

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Item 1: Election of Directors and Director Biographies

Gay Huey Evans CBE
Former Chairman, London Metal Exchange
Age: 69
Director Since: March 2013
ConocoPhillips Committees:

Ms. Huey Evans is the former Chairman of the Board of Directors of the London Metal Exchange. She is also a member of His Majesty’s Treasury Board, Sub-Committee, and Nominations Committee and a non-executive director S&P Global Inc. She also currently serves as a Senior Advisor of Chatham House, as an advisor of Quantexa, and as a Trustee of Benjamin Franklin House. She was Vice Chairman, Investment Banking and Investment Management at Barclays Capital from 2008 to 2010. She was previously head of governance of Citi Alternative Investments (EMEA) from 2007 to 2008 and President of Tribeca Global Management (Europe) Ltd. From 2005 to 2007, both part of Citigroup. From 1998 to 2005, she was director of the markets division and head of the capital markets sector at the U.K. Financial Services Authority. She previously held various senior management positions with Bankers Trust Company in New York and London.

Ms. Huey Evans previously served on the boards of IHS Markit, Itau BBA International Limited, Aviva plc, The London Stock Exchange Group plc., Falcon Private Wealth Ltd, and Standard Chartered plc. She also previously served as Trustee of the Beacon Awards, which celebrate British philanthropy and as Trustee of Wellbeing of Women, where she was Chair of the Investment Committee.

Skills and Qualifications:

Ms. Huey Evans’ in-depth knowledge of, and insight into, global capital markets from her extensive experience in the international financial services industry brings valuable expertise to ConocoPhillips’ businesses.

Ms. Huey Evans was awarded a CBE in 2021 for services to the economy and philanthropy, and an OBE in 2016 for services to financial services and diversity. She is a passionate advocate for ensuring markets build trust through accessibility and transparency and for increased diversity in business.

Other current U.S. public company directorships:

S&P Global Inc.

CEO or senior officer      Financial reporting      Global
Regulatory/government   Public company board service      

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Jeffrey A. Joerres
Former Executive Chairman and Chief Executive Officer, ManpowerGroup Inc.
Age: 64
Director Since: July 2018
ConocoPhillips Committees:

Mr. Joerres served as Chief Executive Officer of ManpowerGroup Inc. from 1999 to 2014, as Chairman of the Board from 2001 to 2014, and as Executive Chairman from May 2014 to December 2015. Mr. Joerres joined ManpowerGroup in 1993 and served as vice president of marketing and senior vice president of European operations and marketing and major account development.

He currently serves on the boards of The Western Union Company and Artisan Partners Asset Management Inc. He previously served as a director of Johnson Controls International plc and Artisan Funds, Inc. Additionally, Mr. Joerres is on the board of the Green Bay Packers and Kohler Co. He is a minority owner in the Milwaukee Bucks. Mr. Joerres is a former director and Chairman of the Federal Reserve Bank of Chicago and previously served on the board of the Boys and Girls Clubs of Milwaukee.

Skills and Qualifications:

Mr. Joerres’s extensive global leadership, human capital management experience, and substantial involvement on both public and private boards enable him to provide guidance to the Board with respect to ConocoPhillips’ people and operations.

Other current U.S. public company directorships:

Artisan Partners Asset Management Inc.
The Western Union Company

CEO or senior officer      Financial reporting      Global
Regulatory/government Public company board service Human capital management

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Item 1: Election of Directors and Director Biographies

Ryan M. Lance
Chairman and Chief Executive Officer, ConocoPhillips
Age: 61
Director Since: April 2012
ConocoPhillips Committees:

Mr. Lance was appointed Chairman and Chief Executive Officer in May 2012, having previously served as Senior Vice President, Exploration and Production—International since May 2009.

Mr. Lance previously served as President, Exploration and Production—Europe, Asia, Africa, and the Middle East from September 2007 to April 2009. From February 2007 to September 2007, he served as Senior Vice President, Technology, and prior to that, Mr. Lance served as Senior Vice President, Technology and Major Projects beginning in 2006. He served as President, Downstream Strategy, Integration and Specialty Businesses from 2005 to 2006.

Skills and Qualifications:

Mr. Lance’s service as Chairman and Chief Executive Officer of ConocoPhillips makes him well qualified to serve both as a director and Chairman of the Board. Mr. Lance’s extensive experience in the industry as an executive in our exploration and production businesses, and as the global representative of ConocoPhillips, makes his service as a director invaluable.

Other current U.S. public company directorships:

Freeport-McMoRan, Inc.

CEO or senior officer      Industry      Global
Regulatory/government Public company board service Environmental/sustainability
Human capital management    

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Item 1: Election of Directors and Director Biographies

Timothy A. Leach
Advisor to the Chief Executive Officer, ConocoPhillips
Age: 64
Director Since: January 2021

Mr. Leach was appointed Advisor to the Chief Executive Officer for ConocoPhillips in May 2022. He previously served as executive vice president, Lower 48. Prior to joining ConocoPhillips, Mr. Leach served as chairman and chief executive officer of Concho Resources Inc. from its formation in February 2006, until its acquisition by ConocoPhillips in January 2021. During his time at Concho, Mr. Leach also served as president from July 2009 until May 2017.

Mr. Leach previously served as an appointed member of the Texas A&M University System Board of Regents from 2017 to 2023 and served as chairman from 2021 to 2023.

Skills and Qualifications:

Mr. Leach brings invaluable contributions to the Board with his extensive industry experience and valuable expertise in strategic leadership of a public company.

CEO or senior officer      Financial reporting      Industry
Regulatory/government Public company board service Environmental/sustainability
Human capital management    

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Item 1: Election of Directors and Director Biographies

William H. McRaven
Retired U.S. Navy Four-Star Admiral (SEAL)
Age: 68
Director Since: October 2018
ConocoPhillips Committees:

William H. McRaven is a Senior Advisor at Lazard Financial. He is also a retired U.S. Navy Four-Star Admiral (SEAL) and the former Chancellor of the University of Texas System. During his time in the military, he commanded special operations forces at every level, eventually taking charge of all U.S. Special Operations. His military career included combat during Desert Storm and both the Iraq and Afghanistan wars. As the Chancellor of the University of Texas System from January 2014 until May 2018, he led one of the nation’s largest and most respected systems of higher education, with over 230,000 students and 100,000 faculty, staff, and health care professionals.

Admiral McRaven is a recognized national authority on U.S. foreign policy and has advised Presidents George W. Bush and Barack Obama and other U.S. leaders on defense issues. He currently serves on the advisory boards of Palantir Technologies Inc. and Haveli Investments. He also serves on the Council on Foreign Relations, the National Football Foundation, the International Crisis Group, and The Mission Continues.

Skills and Qualifications:

Admiral McRaven’s international, logistical, and administrative experience brings valuable expertise on global business issues and government relations to the Board.

CEO or senior officer      Financial reporting      Global
Regulatory/government Human capital management    

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Sharmila Mulligan
Former Chief Strategy Officer, Alteryx
Age: 58
Director Since: July 2017
ConocoPhillips Committees:

Ms. Mulligan served as the Chief Strategy Officer at Alteryx from April 2019 to August 2021 following the company’s acquisition of ClearStory Data, where she served as founder and chief executive officer since its inception in September 2011. From 2009 to 2011, Ms. Mulligan served as executive vice president for Aster Data Systems, Inc. until its acquisition by Teradata Corporation. Prior to Aster Data, Ms. Mulligan was a vice president of software solutions for HP Inc. Prior to HP, Ms. Mulligan was executive vice president of products and marketing at Opsware Inc. from 2002 until its eventual acquisition by HP in 2007. Prior to Opsware Inc., Ms. Mulligan led product management and held vice president positions at Netscape Communications, Microsoft, and General Magic.

Ms. Mulligan serves on the advisory board and board of visitors of Northwestern University and the University of Richmond and is an advisor to, and investor in, numerous enterprise software and consumer technology companies. Ms. Mulligan previously served on the board of directors of Lattice Engines, Inc. until its acquisition.

Skills and Qualifications:

Ms. Mulligan’s experience in cloud computing, scalable data analytics, and a broad range of big data technologies plus Internet of Things and Artificial Intelligence innovation adds exceptional value to the Board. Her experience as a CEO enables her to provide the Board with beneficial strategic leadership qualities.

CEO or senior officer      Financial reporting      Technology
Human capital management        

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Item 1: Election of Directors and Director Biographies

Eric D. Mullins
Chairman and Chief Executive Officer, Lime Rock Resources
Age: 61
Director Since: September 2020
ConocoPhillips Committees:

Mr. Mullins is Chairman and Chief Executive Officer of Lime Rock Resources, a private equity fund that he co-founded in 2005. He previously served as co-chief executive officer of Lime Rock Resources. Lime Rock is focused on acquiring and developing low-risk oil and gas properties. Prior to co-founding Lime Rock, Mr. Mullins served as a managing director with Goldman Sachs in the Natural Resources Group from 1999 to 2004, as vice president from 1994 to 1999, and as an associate from 1990 to 1994.

Mr. Mullins serves on the board of directors for Valero Energy Company. He also serves as vice chair on the board of directors of the Greater Houston Partnership and on the board of trustees of the Baylor College of Medicine. Mr. Mullins previously served on the boards of Anadarko Petroleum Company, Pacific Gas & Electric Company, PG&E Corporation, and LRR Energy, L.P.

Skills and Qualifications:

Mr. Mullins brings to the Board valuable industry experience as well as management, accounting and finance expertise. The Board believes that his career experiences and knowledge in financing and strategic matters for companies greatly assist and enhance the Board’s ability to provide effective strategic oversight.

Other current U.S. public company directorships:

Valero Energy Company

CEO or senior officer      Financial reporting      Industry
Global Public company board service Environmental/sustainability
Human capital management

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Arjun N. Murti
Partner, Veriten LLC
Age: 55
Director Since: January 2015
ConocoPhillips Committees:

Mr. Murti is a Partner at Veriten LLC and a Senior Advisor at Warburg Pincus. He previously served as a partner at Goldman Sachs from 2006 to 2014. Prior to becoming partner, he served as managing director from 2003 to 2006 and as vice president from 1999 to 2003. During his time at Goldman Sachs, Mr. Murti worked as a sell-side equity research analyst covering the energy sector. He was co-director of equity research for the Americas from 2011 to 2014.

Previously, Mr. Murti held equity analyst positions at JP Morgan Investment Management from 1995 to 1999 and at Petrie Parkman from 1992 to 1995.

Mr. Murti serves on the advisory board of ClearPath, Columbia Center on Global Energy Policy, and as a trustee of Kent Place School.

Skills and Qualifications:

Mr. Murti brings to the Board a deep understanding of financial oversight and accountability with his experience as a Partner at Goldman Sachs. He has spent more than 30 years in the financial services industry with an extensive focus, both domestic and global, on the energy industry. This experience provides the Board valuable insight into financial management and analysis.

Financial reporting      Industry      Global
Environmental/sustainability Human capital management    

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Item 1: Election of Directors and Director Biographies

Robert A. Niblock,
Lead Director

Former Chairman, President and Chief Executive Officer, Lowe’s Companies, Inc.
Age: 61
Director Since: February 2010
Lead Director Since: May 2019
ConocoPhillips Committees:

Mr. Niblock served as Chairman of the Board and Chief Executive Officer of Lowe’s Companies, Inc. from January 2005 until July 2018 and as President of Lowe’s from 2011 until July 2018, after having served in that role from 2003 to 2006. Mr. Niblock became a member of the board of directors of Lowe’s when he was named Chairman-and CEO-elect in 2004. Mr. Niblock joined Lowe’s in 1993 and during his career with the company, he also served as vice president and treasurer, senior vice president, and executive vice president and CFO. Before joining Lowe’s, Mr. Niblock had a nine-year career with accounting firm Ernst & Young.

Mr. Niblock serves on the board of directors of Lamb Weston Holdings, Inc. and PNC Financial Services Group, Inc. He previously served as a member of the board of directors of the Retail Industry Leaders Association from 2003 until 2018 and served as its secretary from 2012 until 2018. He also served as its chairman in 2008 and 2009 and as vice chairman in 2006 and 2007.

Skills and Qualifications:

The Board values his experience as a CEO and in financial reporting matters. Mr. Niblock’s experience as a CEO of a large public company allows him to provide the Board with valuable operational and financial expertise.

Other current U.S. public company directorships:

Lamb Weston Holdings, Inc.
PNC Financial Services Group, Inc.

CEO or senior officer      Financial reporting      Public company board service
Human capital management        

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David T. Seaton
Former Chairman and Chief Executive Officer, Fluor Corporation
Age: 62
Director Since: March 2020
ConocoPhillips Committees:

Mr. Seaton is the former Chairman and Chief Executive Officer of Fluor Corporation. He became CEO and joined Fluor’s board of directors in February 2011 and was elected to the role of Chairman of the board in February 2012. Mr. Seaton held numerous positions in both operations and sales globally since joining the company in 1985.

Mr. Seaton serves on the board of directors of The Mosaic Company and the National Association of Manufacturers. He also serves as a senior advisor for the Boston Consulting Group’s Infrastructure Practice and 8VC Enterprises LLC. He has served in leadership positions of numerous business associations, including the Business Roundtable, the International Business Council, the American Petroleum Institute, and the U.S.-Saudi Arabian Business Council. In 2011, he was appointed by the U.S. Secretary of Energy to serve as a member of the National Petroleum Council.

Mr. Seaton is the former chairman of the National Board of Governors of the Boys and Girls Clubs of America, and previously served in leadership positions for the Boys and Girls Clubs of America and United Way of Greater Dallas.

Skills and Qualifications:

As a former CEO of a multinational engineering and construction company, Mr. Seaton brings valuable experience and expertise in operational and financial matters. The Board believes Mr. Seaton’s international business experience with global issues facing a large, multinational public company make him well qualified to serve as a member of the Board.

Other current U.S. public company directorships:

The Mosaic Company

CEO or senior officer      Financial reporting      Industry
Global Regulatory/government Public company board service
Environmental/sustainability Human capital management

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R.A. Walker
Former Chairman and Chief Executive Officer, Anadarko Petroleum Corporation
Age: 67
Director Since: March 2020
ConocoPhillips Committees:

Mr. Walker was the Chairman and Chief Executive Officer of Anadarko Petroleum Corporation until August of 2019, when the company was purchased by Occidental Petroleum. He joined Anadarko in 2005 as senior vice president and chief financial officer, later serving as president and chief operating officer, before becoming CEO in 2012. Prior to his time at Anadarko, he worked in the oil and gas industry, investment and commercial banking, and as an institutional investor.

Mr. Walker is currently senior advisor of Jefferies Financial Group Inc. He previously served on the board of directors of BOK Financial Corporation, CenterPoint Energy Corporation, Enable Midstream Partners, LP, and Health Care Services Corporation.

Skills and Qualifications:

In addition to his former role as Chairman and CEO of Anadarko, Mr. Walker has significant energy industry, commercial and investment banking, and asset management experience, as well as technology, regulatory, governmental, and international business experiences. He has served on and chaired numerous boards of public and private companies, industry trade associations and philanthropic organizations, bringing a broad range of experience and expertise to the Board.

CEO or senior officer      Financial reporting      Industry
Global Regulatory/government Technology
Public company board service Environmental/sustainability Human capital management

FOR The Board recommends you vote FOR each nominee standing for election as director.

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Item 1: Election of Directors and Director Biographies

Board Composition and Refreshment

We are continuously evaluating the overall balance of the Board, including between longer-tenured directors with great institutional knowledge and new directors with fresh external viewpoints. When considering candidates to fill a vacancy on the Board, the priority is finding a candidate with the necessary skills and qualifications. In addition, we believe the Board benefits from diversity of race, ethnicity, gender, age, education, skills, cultural background, and professional experiences. While our Board consists of diverse members, one of our longstanding female directors recently retired and another longstanding female director resigned to more fully pursue other commitments. These recent departures have resulted in less gender diversity in the Board's current composition, which it is actively seeking to improve.
In 2023, the Board undertook a search for qualified female candidates that could bring the right skills and experience to enhance the Board’s composition. A number of candidates have been reviewed and considered, and we are in the process of selecting the right individual, including advanced discussions with one candidate. A great deal of rigor and care is put into the Board refreshment process, which requires time for director selection and onboarding. Nonetheless, we are committed to onboarding at least one new female director by the end of 2024.

As part of our Board’s commitment to regular renewal and refreshment:

The Committee on Directors’ Affairs routinely and on an ongoing basis assesses the Board’s composition, taking into consideration any planned retirements for the Board, as well as background and diversity (including gender, ethnicity, race, national origin, and geographic background);
We have implemented an annual Board and Committee assessment process; and
We have adopted Corporate Governance Guidelines that state that directors generally may not stand for re-election after they reach the age of 72.

Five of the 12 director nominees have joined the Board in the past 5 years. Almost 42 percent of our director nominees are women or racially/ ethnically diverse individuals. The average age of our director nominees is 63 and the average tenure of our director nominees is 6 years.

Board Changes in the Past 5 Years
5 new highly skilled directors have joined our Board
4 directors have left our Board
Skills enhanced in the past 5 years
CEO or senior officer experience
     
Industry experience
Expertise in environmental matters and sustainability
Global organization experience

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Director Onboarding and Education

The Board has an orientation and onboarding program for new directors and provides continuing education for all directors that is overseen by the Committee on Directors’ Affairs.

    New Director Orientation
The orientation program is tailored to the needs of each new director depending on his or her level of experience serving on other boards and knowledge of ConocoPhillips and the oil and gas industry. Materials provided to new directors include information on ConocoPhillips’ strategic plans, financial matters, corporate governance practices, Code of Business Ethics and Conduct, and other key policies and practices. The onboarding process includes a series of meetings with members of senior management and their staff for deep-dive briefings on ConocoPhillips’ operations and financial strategies and SPIRIT Values. In addition, the orientation program includes a visit to ConocoPhillips’ headquarters, and to the extent practicable, certain significant facilities.
   
Continuing Director Education
Continuing director education is provided during portions of Board and committee meetings and is focused on topics necessary to assist them in fulfilling their duties, including regular reviews of compliance and corporate governance developments; business-specific learning opportunities through site visits and Board meetings; and briefing sessions on topics that present special risks and opportunities to ConocoPhillips. Education often takes the form of “white papers” covering timely subjects or topics. As part of the Board’s annual evaluation process, directors are asked to identify areas where they feel continuing education would be helpful.
Director Education Seminars
Directors may attend educational seminars and programs sponsored by external organizations. ConocoPhillips covers the reasonable expenses for a director’s participation in outside continuing education approved by the Committee on Directors’ Affairs.

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Board and Committee Evaluations

Each year, the Board performs a rigorous full Board evaluation, and each director performs a self-evaluation and an evaluation of each of his or her peers. Generally, the evaluation process described below is managed by the Corporate Secretary’s office with oversight by the Committee on Directors’ Affairs. However, the Committee on Directors’ Affairs periodically retains an independent third party to manage the evaluation process to ensure it remains as thorough and transparent as possible.

1 EVALUATION QUESTIONNAIRES    
Formal opportunity for directors to identify potential improvements
Solicit candid feedback from each director regarding the performance and effectiveness of the Board, its committees, and individual directors
2 INDIVIDUAL INTERVIEWS
Lead Director has an in-depth conversation with each member of the Board
3 REVIEW OF FEEDBACK
Lead Director reviews questionnaire and interview responses with Committee on Directors’ Affairs
Lead Director reviews questionnaire and interview responses with full Board in executive session
4 USE OF FEEDBACK
The Committee on Directors’ Affairs develops recommendations
The Committee on Directors’ Affairs and the Lead Director identify areas for improvement of individual directors and of the Board as a whole
The Committee on Directors’ Affairs uses the results of individual director evaluations as a part of the nomination process for the next annual meeting
       
5 CHANGES IMPLEMENTED
As a result of this evaluation process, the Board has strengthened its structure and procedures in the following ways over the past few years:
achieved successful transitions of committee leadership roles;
provided more materials as pre-read to improve efficiencies at meetings and allow more time for discussion and deliberation;
more robust committee reports to the full Board;
individual director coaching; and
added new highly skilled directors to enhance the Board’s composition.

In addition to participating in the full Board evaluation, members of each committee also complete a detailed questionnaire annually to evaluate how well the committee is operating and to suggest improvements. Each committee’s Chair summarizes the responses and reviews them with the members of his or her respective committee.

The Committee on Directors’ Affairs reviews these evaluation processes annually and develops any changes it deems necessary to maintain best practices.

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Corporate Governance at ConocoPhillips

The Committee on Directors’ Affairs and our Board annually review our governance structure, taking into account any changes in Securities and Exchange Commission (the “SEC”) and New York Stock Exchange (the “NYSE”) rules, as well as current best practices. Our Corporate Governance Guidelines address the matters shown below, among others.

Director qualifications
Director responsibilities
Board committees
Director access to officers, employees, and independent advisors
Director compensation and stock ownership requirements
Director orientation and continuing education
Chief Executive Officer evaluation and management succession planning
Board performance evaluations

The Corporate Governance Guidelines are posted on our website under “Investors > Corporate Governance” and are available in print upon request (see “Available Information and Q&A about the Annual Meeting and Voting” beginning on page 130).

Board Leadership Structure

BOARD OVERVIEW
Chairman and Chief Executive Officer: Ryan M. Lance
Lead Director: Robert A. Niblock
Active engagement by all directors
Ten of our 12 director nominees are independent
All members of the Audit and Finance Committee, Human Resources and Compensation Committee, Public Policy and Sustainability Committee, and Committee on Directors’ Affairs are independent

Annual Evaluation of Leadership Structure and Annual Election of Independent Lead Director

ConocoPhillips believes that independent board oversight is an essential component of strong corporate performance and enhances stockholder value. The Board believes there is no single organizational model that is the best and most effective in all circumstances. As a result, the Board periodically considers whether the offices of Chairman and CEO should be combined or separated and who should serve in such capacities.

Under our Corporate Governance Guidelines, our Board chooses its Chairman based on what is in the best interest of ConocoPhillips and our stockholders. The Chairman and CEO may, but need not, be the same person. As part of its annual review and evaluation process, the Board reviews its leadership structure and whether combining or separating the roles of Chairman and CEO is in the best interest of ConocoPhillips and our stockholders.

Our Corporate Governance Guidelines require that, in the event the Board determines that it is in the best interest of ConocoPhillips and its stockholders for the offices of Chairman and CEO to be held by the same person (or in the event the office of Chairman is not held by the CEO, but is nonetheless not independent), an independent lead director must be selected from among the non-employee directors. The Board will continue to reexamine its corporate governance policies and leadership structures on an ongoing basis to ensure that they continue to meet our needs.

For the 2023 Proxy Statement, we received a stockholder proposal asking stockholders to vote in favor of requiring the Board of Directors to amend the governing documents, as necessary, to separate the role of CEO and Chairman. After evaluating the proposal, the Committee on Directors’ Affairs determined that it is in the best interest of ConocoPhillips and its stockholders to maintain flexibility in our governing documents to allow the Board of Directors to determine what organizational model best serves the interest of our company and its stockholders. The proposal failed to receive significant support in 2023, with only approximately 25% of stockholders indicating support for the proposal as submitted. During engagements in 2023, stockholders were interested in learning about our leadership structure, and appreciated hearing about how our board has the responsibility to review the governance structure on a regular and ongoing basis, allowing for adaptability. Stockholders expressed support for the Board of Directors continuing to evaluate whether the combined role of Chairman and CEO is in the best interest of the Company.

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Why We Believe in Our Leadership Structure

In 2023, the Board reviewed our leadership structure and determined that continuing with a combined Chairman and CEO, with our independent Lead Director, continues to be in the best interest of ConocoPhillips and our stockholders. The Board believes its current structure and processes ensure our Chairman and CEO is in a position to guide the Board in setting priorities for ConocoPhillips and in addressing the risks and challenges we face, while also providing for robust, effective, and independent oversight of management by the Board and our independent Lead Director. 

 
Ryan M. Lance
Chairman and Chief Executive Officer
Robert A. Niblock
Lead Director (Since May 2019)
 
Possesses extensive knowledge and deep understanding of the business and challenges we face
Facilitates timely deliberation by the Board of items of the highest priority through his day-to-day insight into our challenges and opportunities
Promotes unity and reliability through consistent leadership direction internally and externally
Serves as a bridge between the Board and management, promoting collaboration while ensuring oversight
Positioned to most effectively execute the strategy for the business to maximize stockholder value
Proven successful in leading ConocoPhillips through business cycles and major transactions, including subsequent integration of acquired businesses
Extensive experience serving on public company boards provides strong background in corporate governance
Deep understanding of our business and extensive amounts of institutional knowledge having served as an active director since 2010, including rotations on all of the Committees of the Board
Respected by management and the other Directors, promoting a collaborative environment for decision-making, while enabling strong oversight of executive leadership
Strong working relationship with our Chairman and CEO
Deeply invested in ensuring the effectiveness and independence of the Board, holding in-depth conversations with each Director as part of the annual evaluation process
 

The Board consists of ten independent directors. Furthermore, each of the Audit and Finance, Human Resources and Compensation, and Directors’ Affairs committees is made up entirely of independent directors. The Chairs of the Board’s committees establish their agendas and review their committee materials in advance of meetings, conferring with other directors and members of management as each deems appropriate. Moreover, each director is free to suggest agenda items and to raise matters that are not on the agenda at Board and committee meetings. Our Corporate Governance Guidelines require our Lead Director to preside over an executive session of the non-employee directors at every meeting. Each executive session may include a discussion of the performance of the Chairman and CEO, matters concerning the relationship of the Board with the Chairman and CEO and other members of senior management, and such other matters as the non-employee directors deem appropriate. In addition, our Lead Director presides over a meeting of our independent directors at least once a year as required by the NYSE rules. No formal action of the Board is taken at these meetings, although the non-employee directors may subsequently recommend matters for consideration by the full Board. The Board may invite guest attendees for the purpose of making presentations, responding to questions by the directors, or providing counsel on specific matters within their areas of expertise.

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LEAD DIRECTOR’S RESPONSIBILITIES:
Presides at all meetings of the Board at which the Chairman is not present, including executive sessions of the Board, and manages the discussion with the Chairman following such executive sessions;
Serves as liaison between the Chairman and the non-employee directors;
Advises the Chairman of the Board’s informational needs and ensures appropriate information is provided to the Board;
In consultation with the Chairman, approves meeting agendas for the Board;
Approves meeting schedules to assure that there is sufficient time for discussion of all agenda items;
Has authority to call meetings of the non-employee directors;
Approves the retention of consultants that report directly to the Board;
Ensures that the Board’s self-assessments are conducted annually to promote efficient and effective Board performance and functioning;
Evaluates the performance of the CEO in consultation with the Chair of the Human Resources and Compensation Committee; and
If requested by stockholders, after consulting with the Chairman and CEO, ensures that he or she will be available for appropriate engagements with those stockholders.

Board Independence

The Corporate Governance Guidelines contain director independence standards that are consistent with the standards set forth in the NYSE Listed Company Manual to assist the Board in determining the independence of ConocoPhillips’ non-employee directors. Under such standards, the Board has determined that all non-employee directors meet the standards regarding independence set forth in the Corporate Governance Guidelines and are free of any material relationship with ConocoPhillips (either directly or indirectly as a partner, stockholder, or officer of an organization that has a relationship with ConocoPhillips). In making such determination, the Board specifically considered the fact that many of our directors may be directors, retired officers, and stockholders of companies with which we conduct business. In addition, some of our directors may serve as employees of, or consultants or advisors to, companies that do business with ConocoPhillips and its affiliates. In all cases, the Board determined that the nature of the business conducted and the interest of the director by virtue of such position were immaterial both to ConocoPhillips and to the director.

In recommending that each non-employee director is independent, our Board, with input from the Committee on Directors’ Affairs, considered relationships that, while not constituting related-party transactions in which a director had a direct or indirect material interest, nonetheless involved transactions between ConocoPhillips and a company with which a director is affiliated, whether through employment status or by virtue of serving as a director. Included in the Committee’s review were the following transactions, which occurred in the ordinary course of business. In all instances, it was determined that the nature of the business conducted and the dollar amounts involved were immaterial, both to ConocoPhillips and the relevant counterparty, and fell within independence standards set forth in the ConocoPhillips Corporate Governance Guidelines and the NYSE Listed Company Manual.

Director

Matters Considered

Dennis V. Arriola Ordinary course business transactions with Commercial Metals Company
Gay Huey Evans CBE Ordinary course business transactions with Standard Chartered plc and S&P Global Inc.
Eric D. Mullins Ordinary course business transactions with Greater Houston Partnership, Lime Rock Resources, and Valero Energy Company
David T. Seaton Ordinary course business transactions with Boston Consulting Group, The Mosaic Company, and the National Association of Manufacturers

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Related Party Transactions

In accordance with SEC and NYSE rules, we maintain a policy on related party transactions (“Related Party Transaction Policy”), which requires the Audit and Finance Committee to review all Reportable Related Party Transactions in advance. A Reportable Related Party Transaction is a transaction, arrangement, or relationship (or series of similar transactions, arrangements, or relationships) in which:

We (or one of our subsidiaries) was, is or will be a participant;
The aggregate amount involved exceeds $120,000 in any fiscal year; and
Any person who is, or at any time since the beginning of ConocoPhillips’ last fiscal year was, an executive officer, director, director nominee, or holder of at least 5 percent of our equity securities (each a “Covered Person”), or any of such Covered Person’s immediate family members, had, has, or will have a direct or indirect material interest.

In accordance with the Related Party Transaction Policy, Covered Persons are required to identify business and financial affiliations involving themselves or their immediate family members that could reasonably be expected to give rise to a Reportable Related Party Transaction. Based on this information, our legal staff, in consultation with the finance team, performs the necessary diligence to determine whether any such Reportable Related Party Transaction exists or will exist, once completed. Upon determining that a transaction is or will be a Reportable Related Party Transaction, the General Counsel presents all relevant facts and circumstances to the Audit and Finance Committee, which reviews transactions for materiality and determines whether the transaction is in the best interest of ConocoPhillips, before either approving or disapproving it. In making its decision, the Audit and Finance Committee considers whether the transaction is on terms comparable to those that could be obtained in arm’s-length dealings with an unrelated third party and the extent of the Covered Person’s interest in the transaction, taking into account the conflicts of interest provisions of ConocoPhillips’ Code of Business Ethics and Conduct and such other factors as it believes are relevant. The Audit and Finance Committee shall prohibit any transactions that it determines are inconsistent with the interests of ConocoPhillips and its stockholders.

The Audit and Finance Committee approved the following Reportable Related Party Transactions:

Cameron J. Smith, son-in-law of William L. Bullock, Jr., our Executive Vice President and Chief Financial Officer, was employed in a non-executive position. The aggregate value of the compensation paid to Mr. Smith during fiscal year 2023 was approximately $346,312, consisting of salary, annual incentive (earned in fiscal 2023 and paid in fiscal 2024), and restricted stock unit awards. In addition, Mr. Smith received the standard benefits provided to other non-executive ConocoPhillips employees for his services during fiscal year 2023.

Timothy A. Leach serves as a director and also an employee of the company, but not as an executive officer. Mr. Leach receives compensation from the company for the services he provides as an employee. Mr. Leach does not receive any additional compensation for his service as a director. The compensation he received as an employee is summarized in footnote 1 beginning on page 55.

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Board Meetings and Committees

The Board met five times in 2023. Each director attended at least 75 percent of the aggregate of the Board and applicable committee meetings held in 2023.

The Board has five standing committees: (1) the Executive Committee; (2) the Audit and Finance Committee; (3) the Human Resources and Compensation Committee; (4) the Committee on Directors’ Affairs; and (5) the Public Policy and Sustainability Committee. The Board determined that all of the members of the Audit and Finance Committee, the Human Resources and Compensation Committee, the Public Policy and Sustainability Committee, and the Committee on Directors’ Affairs are independent directors within the meaning of SEC regulations, the listing standards of the NYSE, and ConocoPhillips’ Corporate Governance Guidelines. Each committee, other than the Executive Committee, conducts an annual self-evaluation as described under “Board and Committee Evaluations” on page 35. The charters for our standing committees can be found on ConocoPhillips’ website at www.conocophillips.com under “Investors > Corporate Governance  > Committees.” Stockholders may request printed copies of these charters by following the instructions under “Available Information and Q&A About the Annual Meeting and Voting” beginning on page 130.

The committee memberships as of May 13, 2024 and the respective primary responsibilities of each committee, as well as the number of meetings each committee held in 2023, are shown below.

 Executive 
         
     
   
2023 meetings | 1             Primary responsibilities  
Ryan M. Lance | Chair
Jeffrey A. Joerres
Eric D. Mullins
Arjun N. Murti
Robert A. Niblock
    ●  Exercises the authority of the full Board between Board meetings on all matters other than: (1) those matters expressly delegated to another committee of the Board; (2) the adoption, amendment, or repeal of any of our By-Laws; and (3) matters that cannot be delegated to a committee under statute or our Certificate of Incorporation or By-Laws.  
                                                

 Audit and Finance 
       
   
   
2023 meetings | 9         Primary responsibilities  
Arjun N. Murti | Chair
Dennis V. Arriola
William H. McRaven
Sharmila Mulligan
Eric D. Mullins
R.A. Walker
       
Discusses with management, the independent auditors, and the internal auditors the integrity of ConocoPhillips’ accounting policies, internal controls, financial statements, financial reporting practices, and select financial matters, including our capital structure, complex financial transactions, financial risk management, retirement plans, and tax planning.
Reviews the qualifications, independence, and performance of our independent auditors and the qualifications and performance of our internal auditors and chief compliance officer.
Reviews our compliance with legal and regulatory requirements and corporate governance, including our Code of Business Ethics and Conduct.
Discusses with management and the chief compliance officer the implementation and effectiveness of ConocoPhillips’ global compliance and ethics program.
Maintains open and direct lines of communication with the Board and our management, internal auditors, independent auditors, and the global compliance and ethics organization.
Assists the Board in fulfilling its oversight of enterprise risk management, particularly with regard to: (1) market-based risks; (2) financial reporting; (3) effectiveness of information systems and cybersecurity; and (4) commercial trading.
Reviews, and coordinates the review by other committees of, significant corporate risk exposures and steps management has taken to monitor, control, and report such exposures.
 
         

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 Human Resources and Compensation 
   
   
   
2023 meetings | 7             Primary responsibilities  
Jeffrey A. Joerres | Chair
Dennis V. Arriola
Gay Huey Evans CBE
Sharmila Mulligan
Arjun N. Murti
Robert A. Niblock
   
Oversees our executive compensation policies, plans, programs, and practices and reviews our retention strategies.
Assists the Board in discharging its responsibilities relating to the fair and competitive compensation of our executives and other key employees.
Together with the Lead Director, annually reviews the performance of the CEO.
Annually reviews and determines compensation for the CEO and our Senior Officers.
Reviews and reports to the Board annually on the succession-planning process for the CEO and senior management.
Reviews and makes recommendations to the Board regarding human capital strategies, such as leadership development; cultural; and Diversity, Equity and Inclusion (“DEI”) management.
Oversees our compliance with SEC rules and regulations regarding stockholder approval of certain executive compensation matters.
Assists the Board in fulfilling its oversight of enterprise risk management, particularly risks in connection with compensation programs and practices and retention strategies.
 
         

Directors’ Affairs
       
   
   
2023 meetings | 5             Primary responsibilities  
Robert A. Niblock | Chair
Gay Huey Evans CBE
Jeffrey A. Joerres
David T. Seaton
   
Selects and recommends director candidates to be submitted for election at the Annual Meeting and to fill any vacancies on the Board.
Recommends committee assignments to the Board.
Reviews and recommends to the Board compensation and benefits policies for non-employee directors.
Monitors the orientation and continuing education programs for directors.
Conducts an annual assessment of the qualifications and performance of the Board and each of the directors.
Assists the Board in fulfilling its oversight of enterprise risk management, particularly risks in connection with Board succession planning, stockholder matters, and governance policies and procedures.
 
         

 Public Policy and Sustainability 
       
   
   
2023 meetings | 5             Primary responsibilities  
Eric D. Mullins | Chair
William H. McRaven
David T. Seaton
R.A. Walker
   
Advises the Board on current and emerging domestic and international public policy issues.
Assists the Board in developing and reviewing policies and budgets for charitable and political contributions.
Reviews and makes recommendations to the Board on, and monitors compliance with, policies, programs, and practices with regard to health, safety, security (excluding cybersecurity), environmental protection, sustainable development and climate-related trends and risks, operations risk management, government relations, political/regulatory risk management, and similar matters.
Assists the Board in fulfilling its oversight of enterprise risk management, particularly risks in connection with political, safety, sustainable development (social and environmental), and climate-related issues or trends that affect the company and risks related to operational integrity and public policy aspects of our business and the communities where we operate.
 
         

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Board Oversight of Risk Management

The Board has broad oversight for our risk-management programs. In this role, the Board is responsible for ensuring that the risk-management processes designed and implemented by management are functioning as intended and that necessary steps are taken to foster a culture of prudent decision-making throughout the organization.

In order to maintain effective Board oversight across the entire enterprise, the Board delegates to individual committees certain elements of its oversight function, as shown below. In addition, the Board delegates authority to the Audit and Finance Committee to manage the risk oversight efforts of the various committees. As part of this authority, the Audit and Finance Committee regularly discusses ConocoPhillips’ enterprise risk-management policies and facilitates appropriate coordination among committees to ensure that our risk-management programs are functioning properly. The Board receives regular updates from its committees on individual categories of risk, including strategy, reputation, operations, climate change, people, technology, investment, political, legislative, regulatory, and market, and receives a report periodically from the Chair of the Audit and Finance Committee about oversight efforts and coordination.

Senior Management
ConocoPhillips’ senior management is responsible for day-to-day management of risk, including designing and implementing risk management processes and policies to address the various exposures to risk. Senior management regularly reports to the Board and its committees on a variety of risks.
Board of Directors
                     
             
             
Audit and Finance Committee
Financial/reserve reporting
Compliance and ethics
Cybersecurity
Litigation and tax matters
Human Resources and Compensation Committee
Retention
Compensation programs
Diversity, equity, and inclusion
Executive succession planning
Committee on Directors’ Affairs
Board succession planning
Stockholder matters
Corporate governance policies and procedures
Public Policy and Sustainability Committee
Health and safety
Sustainability and climate-related issues
Operational integrity
Political and regulatory
 
The Audit and Finance Committee manages and coordinates risk oversight efforts of all committees
 

The Board exercises its oversight function with respect to all material risks to ConocoPhillips, which are identified and discussed in our public filings with the SEC.

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      Managing Cybersecurity Risks  
 
Protecting the confidentiality, integrity, and availability of our infrastructure, resources, and information is a critical part of risk management at ConocoPhillips, which is why we take a multilayered approach.
The full Board receives a report on cybersecurity risks annually and the Audit and Finance Committee receives reports on cybersecurity risks multiple times per year.
ConocoPhillips has a dedicated Chief Information Security Officer (CISO) who is responsible for overseeing the cybersecurity program and works with a cybersecurity team, including Directors of IT and OT Security Architecture and a Manager of Cyber Security Operations Center (CSOC), who is responsible for detection, investigation, and response to cybersecurity incidents (collectively, the “IT/OT Security Team”).
The IT/OT Security Team has a CSOC Incident Handling Process and a Computer Security Incident Response Plan (CSIRP), which govern the Company’s response to cybersecurity incidents. These processes and plans include escalation based on a defined incident categorization to the CISO, senior managers and other cybersecurity program stakeholders, including senior leadership, the Audit and Finance Committee, and internal and external legal advisors.
In addition to a CSIRP, ConocoPhillips maintains a robust set of IT/OT Security policies, standards, and procedures to govern our program and to identify, assess, and mitigate the risks and effects of, and recover from, cyber-related threats. These policies and procedures are reviewed and updated regularly to help protect and enhance our security posture.
ConocoPhillips has a third-party risk management program designed to identify, assess, and mitigate risks associated with third-party service providers, including cybersecurity risks.

      Managing Sustainability-Related Risks  
   
Our governance structure is designed to ensure that management of sustainability-related risks and opportunities throughout the organization is incorporated into our business strategy and key decision-making. Our governance model extends from the Board’s Public Policy and Sustainability Committee, through the Executive Leadership Team (“ELT”), to leaders and internal subject matter experts.

Board of Directors
Public Policy and Sustainability Committee
Executive Leadership Team
Sustainability and Public Policy Executive Council
Sustainable Development Leadership Team
Business Unit Presidents, Function Heads, Sustainable Development Team
Operations
Business Unit Leadership, Subject Matter Experts, HSE Leadership, Global SD Issues Working Groups

Our comprehensive risk governance framework extends from the Board of Directors through executive and senior management to the working levels in each of our business units (BUs). This framework provides oversight of our sustainable development positions and related strategic planning and risk management policies and procedures.

We use a management system approach to assess, and manage sustainability risks, including climate, nature and social-related risks. This system links directly to the enterprise risk management process, which includes an annual risk review by executive leadership and the Board.

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      Managing Climate-Related Risks  
   
As we manage through the energy transition, oil and natural gas will remain an essential part of the energy supply mix in a low-carbon world, and flexibility and resilience will be required to ensure that supply. In 2020, we adopted a climate-related risk framework with an ambition to reduce our operational (Scope 1 and 2) emissions to net-zero by 2050. The objective of our Climate Risk Strategy is to manage climate-related risk, optimize opportunities and equip the company to respond to changes in key uncertainties, including government policies around the world, emissions reduction technologies, alternative energy technologies and changes in consumer trends.
Scenario analysis is an important aspect of our strategic planning process that enables us to:
Gain a better understanding of external factors that impact our business;
Identify leading indicators and trends;
Test the robustness of our strategy across different business environments;
Communicate risks appropriately; and
Inform how we position our business as technologies and markets evolve.
Combined with our focus on developing the lowest cost of supply resources and low GHG intensity assets, we believe our climate risk framework is the most effective way for our company to sustainably compete in the energy transition.

      Managing Nature-Related Risks  
   
Our activities and operations can contribute to nature-related risks including resource use through freshwater withdrawal or consumption and land-use change through infrastructure footprint resulting in habitat disturbance, reduced habitat intactness and impacts on species distribution.
Fresh water is a limited resource in regions experiencing water scarcity, and local availability may be affected in the future by physical effects of climate change, such as droughts. We manage water risks and mitigate potential impacts to water resources locally, taking into account the unique social, economic, and environmental conditions of each basin or offshore marine area.
Biodiversity loss is a global challenge that requires local mitigation solutions. We manage risks and mitigate impacts to areas with biological or cultural significance using the Mitigation Hierarchy. We support habitat and species conservation through strategic and proactive conservation initiatives in collaboration with conservation partners.

      Managing Social-Related Risks  
   
We engage with local stakeholders those who may impact or be impacted by our business to understand their values and interests, reduce the impact of operations and proposed projects, and support economic and community development opportunities. We seek solutions that create mutually beneficial relationships and build long-term value for both the company and our stakeholders.

      Managing Succession Planning Risks  
   
Management succession planning is a fundamental and ongoing part of the Board's responsibilities and is reviewed by the full Board annually. In addition, the Human Resources and Compensation Committee reviews and reports to the Board annually on the succession-planning process for the CEO and senior management for normal course of business, both short-and long-term, and in situations for which the CEO or senior management unexpectedly becomes unable to perform the responsibilities of their positions. Our robust, evergreen process ensures we have the right talent in place to deliver on our strategy.

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Stockholder Engagement and Board Responsiveness

ConocoPhillips is committed to engaging in constructive and meaningful conversations with stockholders and to building and managing long-term relationships based on mutual trust and respect. The Board values the input and insights of our stockholders and believes that consistent and effective Board-stockholder communication strengthens the Board’s role as an active, informed, and engaged fiduciary.

Board Oversight of Engagement

In an effort to continuously improve ConocoPhillips’ governance processes and communications, the Committee on Directors’ Affairs has adopted Board and Shareholder Communication and Engagement Guidelines. Recognizing that director attendance at the annual meeting provides stockholders with a valuable opportunity to communicate with Board members, we expect directors to attend. In 2023, all of the directors standing for reelection participated in the annual meeting. We anticipate that all of the director nominees will participate in the Annual Meeting in May. We also support an open and transparent process for stockholders and other interested parties to contact the Board in between annual meetings as noted under “Communications with the Board of Directors” on page 53.

THE BOARD-DRIVEN STOCKHOLDER ENGAGEMENT PROCESS

 
 
       
         
                   
   
DELIBERATE, ASSESS, AND PREPARE
The Board regularly assesses and monitors investor sentiment, stockholder voting results, and trends in governance, executive compensation, human capital management, culture, regulatory, environmental, social, and other matters. With that foundation, the Board identifies and prioritizes potential topics for stockholder engagement.
 
REACH OUT AND ENGAGE
Management regularly meets with stockholders to actively solicit input on a range of issues and reports stockholder views to our Board. With management’s assistance, and when appropriate, members of the Board will engage in dialogue with stockholders, which clarifies and deepens the Board’s understanding of stockholder concerns and provides stockholders with insight into our Board’s processes.
 
EVALUATE AND RESPOND
Stockholder input informs our Board’s ongoing process of continually improving governance and other practices. Specifically, the Board and management regularly review stockholder input to evaluate any identified issues and concerns. The Board responds to stockholders, as appropriate, with continued discussion and enhancements to policy, practices, and disclosure.
             

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Ongoing Engagement and Board Reporting

Executives and management from ConocoPhillips’ investor relations, sustainable development, human resources, government affairs, and legal groups and, when appropriate, directors meet with stockholders regularly on a variety of topics. Management provides reports to the Board and its committees regarding the key themes and results of these conversations, including typical investor concerns and questions, emerging issues, and pertinent corporate governance matters.

In 2023, we actively reached out to investors owning more than 50 percent of our stock to invite them to participate in in-depth discussions with our engagement team. We gained valuable feedback during these discussions, which was shared with the Board and its relevant committees.

Board Responsiveness

Our Board is committed to constructive engagement with investors. We regularly evaluate and respond to the views expressed by our stockholders. This dialogue has led to enhancements in our corporate governance, environmental, social, and executive compensation activities that the Board believes are in the best interest of ConocoPhillips and our stockholders.

We contacted stockholders representing over
50%
of shares outstanding
      We held meetings with stockholders representing approximately
40%
of shares outstanding
     80%
of our institutional base

 

Our 2023 Governance Leadership Team

Vice President, Investor Relations
Vice President, Sustainable Development
Managing Director, Climate Risk
General Manager, Compensation and Benefits
Chief Diversity Officer
General Manager, HR
Vice President & Deputy General Counsel, Corporate & Tech/IP
Independent Lead Director, Robert A. Niblock (select attendance)

 

Topics Discussed

Our strategy and value proposition
Sustainability
Executive compensation
Human capital management
Governance

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What We Learned

Strategy

Stockholders appreciated the opportunity to be updated on our strategy.
Several stockholders asked questions on recent acquisition and divestiture activity, including potential impacts to ESG-related targets.

 

Sustainability

Stockholders supported our climate strategy and appreciated hearing how we were progressing against our Plan for the Net-Zero Energy Transition. See “Progress Report on Our Plan for the Net-Zero Energy Transition” beginning on page 14.
Stockholders consistently commented on the quality of our disclosures, including around Scope 3 emissions.
Several stockholders commended us on our water disclosures and metrics, and our forward-looking approach to nature-related disclosures.

 

Executive Compensation

The majority of stockholders either had no questions or concerns about our compensation or indicated support of programs and recent changes.
The overwhelming majority of stockholders expressed support for how we have tied ESG goals into our short-term incentive program.
Stockholders supported the increase in our CEO’s stock ownership guidelines from six to eight times salary and did not request additional changes.

For the 2023 Proxy Statement, we received a stockholder proposal asking stockholders to vote in favor of requiring NEOs to retain a significant percentage of shares acquired from equity compensation plans until reaching normal retirement age. After evaluating the proposal, the HRCC determined that increasing the CEO’s stock ownership guidelines from six to eight times salary achieved the appropriate balance of being consistent with market practices, enabling us to attract and retain executive talent, and having robust ownership guidelines that align executive compensation with stockholder interests. The proposal failed to receive significant support in 2023 with less than 23% of stockholders indicating support for the proposal as submitted. During engagements in 2023, stockholders were supportive of the change made by the HRCC and did not request any additional changes.

 

Human Capital Management

Stockholders were interested in hearing more detail related to CEO succession planning. See “Managing Succession Planning Risks” on page 44.
Stockholders remain interested in hearing about the results of our Perspectives survey and our approach to DEI. See “A Compelling Culture” on page 50.
Stockholders wanted to learn more about our ability to attract and retain a qualified workforce, including how we measure and analyze employee engagement. See “Valuing our People” on page 52.

 

Governance

Stockholders had questions about our board refreshment and gender diversity, but expressed appreciation for our disclosures and our focus on finding the right candidates for our board. See “Board Composition and Refreshment” on page 33.
Stockholders were interested in learning about our leadership structure, and appreciated hearing about how our board has the flexibility and responsibility to review the governance structure on a regular and ongoing basis. See “Board Leadership Structure” beginning on page 36.

For the 2023 Proxy Statement, we received a stockholder proposal asking stockholders to vote in favor of requiring the Board of Directors to amend the governing documents, as necessary, to separate the role of CEO and Chairman. After evaluating the proposal, the Committee on Directors’ Affairs determined that it is in the best interest of ConocoPhillips and its stockholders to maintain flexibility in our governing documents to allow the Board of Directors to determine what organizational model best serves the interest of our company and its stockholders. The proposal failed to receive significant support in 2023, with only approximately 25% of stockholders indicating support for the proposal as submitted. During engagements in 2023, stockholders were interested in learning about our leadership structure, and appreciated hearing about how our board has the responsibility to review the governance structure on a regular and ongoing basis, allowing for adaptability. Stockholders expressed support for the Board of Directors continuing to evaluate whether the combined role of Chairman and CEO is in the best interest of the Company.

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Code of Business Ethics and Conduct

ConocoPhillips has adopted a worldwide Code of Business Ethics and Conduct, which applies to all directors, officers, and employees. The Code of Business Ethics and Conduct is designed to help resolve ethical issues in an increasingly complex global business environment and covers topics such as conflicts of interest, insider trading, competition and fair dealing, discrimination and harassment, confidentiality, payments to government personnel, anti-boycott laws, U.S. embargoes and sanctions, compliance procedures, employee complaint procedures, expectations for supervisors, internal investigations, use of social media, and money laundering. In accordance with good corporate governance practices, we periodically review and revise the Code of Business Ethics and Conduct as necessary.

The Code of Business Ethics and Conduct is posted on our website under “Investors > Corporate Governance.” Any amendments to the Code of Business Ethics and Conduct or waivers of it for our directors and executive officers will be posted on our website promptly to the extent required by law. Stockholders may request printed copies of our Code of Business Ethics and Conduct by following the instructions located under “Available Information and Q&A About the Annual Meeting and Voting” beginning on page 130.

Commitment to Our Culture

We believe our performance is not merely about what we do, but how we do it. The way we do our work is what sets us apart and drives our performance. We run our business under a set of guiding principles we call our SPIRIT Values — Safety, People, Integrity, Responsibility, Innovation, and Teamwork. See “Human Capital Management” on page 49.

We know that our people are one of our greatest assets. Our reputation and integrity require that each employee, officer, director, and those working on our behalf maintain personal responsibility for ethical business conduct. We respect one another and have created an inclusive environment that reflects the different backgrounds, experiences, ideas, and perspectives of our employees. We recognize that a strong corporate culture is critical to our long-term success. Senior management is influential in defining and shaping our corporate culture and sets the expectations and tone for an ethical work environment. Our Board also provides valuable oversight in assessing and monitoring our corporate culture. ConocoPhillips has a long-standing commitment to ensuring respectful, fair, and nondiscriminatory treatment for all employees and maintaining a workforce that is free from all forms of unlawful conduct.

     POLICIES AND TRAINING           BOARD OVERSIGHT           INTERNAL RESOURCES           INVESTIGATIVE PROCESSES
Code of Business Ethics and Conduct; mandatory annual attestations completed by all employees
Equal Employment Opportunity and Affirmative Action Policies/Programs
Workplace Harassment Prevention Training required for all employees
Audit and Finance Committee provides oversight to Global Compliance & Ethics (“GC&E”) organization
Five in-person Committee/Board meetings throughout the year
Compliance program activity, key metrics and aggregate investigative updates shared with the Audit and Finance Committee
Multiple avenues to seek guidance or report workplace ethical concerns
Ethics Helpline, accessible by phone or online
Employees can also report concerns to Supervisors, Human Resources representatives, or directly to GC&E
Fair and confidential investigative processes conducted by an independent investigator
Anonymous reporting always available; zero tolerance for retaliation
GC&E reviews all investigation summaries and recommendations to ensure global consistency

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Human Capital Management

Our strategy, our performance, our culture, and our reputation are fueled by our world-class workforce. The diverse people of ConocoPhillips have always been the heart of our company, and we recognize that attracting, retaining, and developing talent is a competitive imperative within our changing industry.

Governance
Our ELT and our Board play key roles in setting our HCM strategy and driving accountability for meaningful progress. The ELT and Board engage often on workforce-related topics, including DEI, succession planning, and employee feedback. Our HCM programs are supported by business leaders across ConocoPhillips and overseen and administered by our human resources function.

Key Elements of our HCM Strategy
We depend on our workforce to successfully execute our company’s strategy, and we recognize the importance of creating a workplace where our people feel valued. Our HCM programs are built around three pillars that we believe are necessary for success: a compelling culture, attracting a world-class workforce, and valuing our people. Each of these pillars is described in more detail below and is subject to oversight by our HRCC of the Board of Directors.

VALUES AND PRINCIPLES
Our human capital management (“HCM”) strategy is built upon the strong foundation of our SPIRIT Values and is responsive to feedback from key stakeholders. Our SPIRIT Values — Safety, People, Integrity, Responsibility, Innovation, and Teamwork — set us apart, align our workforce and provide a foundation for our culture. These values set the tone for how we interact with all our stakeholders, internally and externally, and are a source of pride. Our day-to-day work is also guided by the principles of accountability and performance, which means the way we do our work is as important as the results we deliver.

      A COMPELLING CULTURE             ATTRACTING A WORLD-CLASS WORKFORCE             VALUING OUR PEOPLE
SPIRIT Values guide our actions
Annual Perspectives employee engagement survey used to establish meaningful cultural action plans tied to employee feedback
A dedicated DEI organization aligns strategic actions with DEI pillars: people, programs and process, culture, and our external brand and reputation
Data analytics leveraged to track key workforce/engagement metrics through transparent internal dashboards and expanded external disclosures
Internal and external best practices leveraged to support/offer different ways of working through hybrid work programs
Implemented several office improvement and integration projects to enhance employees’ workplace experience
 
Consistent recruitment/selection practices implemented to minimize bias
Actively partner with trade associations and minority nonprofit organizations to broaden pipelines of talent
U.S. Summer Internship Program offers university students a compelling, hands-on experience
Foster significant long-standing partnerships with universities to build external pipelines of early-career talent; increasing partnerships with Historically Black Colleges and Universities (HBCUs) and Hispanic-serving institutions
A strategic process for allocating university contributions budget to invest in strengthening and expanding our future talent pools, which includes giving to programs that advance DEI
Robust succession planning process, inclusive of diverse pipelines, implemented to ready employees for future roles and to promote business continuity
Hands-on Talent Management Teams (“TMTs”) guide employee development
Real-time recognition programs provide employees with monetary and non-monetary awards
Reward employees for contributing to our success through:
Competitive, performance-based compensation packages; global equitable pay practices
Compensation programs linking individual and company performance
Inclusive global benefits informed by external market practices and employee needs/feedback
Global wellness programs addressing physical/mental well-being
Expanded benefits to support families 

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A Compelling Culture

How we do our work is what sets us apart and drives our performance. We are experts in what we do and continuously find ways to do our jobs better. Our different backgrounds, ideas and views drive our success. Together, we deliver strong performance, but not at all costs. We embrace our core cultural attributes that are found across the organization.

Spotlight Story:  
 
   Lower 48 Program Ensures Mental Wellness Support Is Just a Colleague Away   
Mental health matters. To ensure employees have access to resources designed to support their mental health needs, the Lower 48 business unit launched the Mental Health Allyship Program in 2023. As part of this program, 22 employee volunteers serve as Mental Health Allies (“Allies”) to serve as a first point of contact, directing colleagues to internal resources, like the company’s Employee Assistance Program or outside resources in their area. Supported by the company’s mental health experts, Allies have received training to recognize when someone may be struggling or experiencing a decline in their mental well-being. While not professional counselors, Allies help “get the conversation started.” Programs like this help us continue to build an inclusive and diverse work environment that embraces our SPIRIT Values.

ADVANCING OUR DEI JOURNEY

As our industry evolves, we’ll continue to face both new opportunities and challenges. So, we’ll need the best and brightest people who bring passion and excitement for solving important problems. We also need to cultivate an environment where everyone is encouraged and able to contribute — no matter their role, level or location. This is how innovation thrives, leading to better business outcomes. That is why we’ve put an emphasis on — and are committed to — elevating DEI and creating a great place to work.

At ConocoPhillips, we believe our unique differences power the future of energy. Our DEI vision is to foster an inclusive culture that values the rich mixture of backgrounds, identities, and workstyles of our people, built on equitable practices that support all employees in unlocking their full potential. Our commitment to DEI is foundational to our SPIRIT Values and to achieving our business objectives. All employees play a part in creating and sustaining an inclusive work environment because everyone benefits from DEI.

The ELT has ultimate accountability for advancing our DEI commitments through a governance structure that includes a Chief Diversity Officer (CDO), a dedicated DEI organization, and a global DEI Council consisting of senior leaders from across the company. The company sets goals and measures progress based on a transparent DEI strategy with four pillars that guide our focus and approach: people, programs and processes, culture, and our external brand and reputation. All company leaders are accountable for advancing DEI through local efforts. Our DEI efforts and progress are regularly reviewed with the Board.

Our 2023 focus was on building clarity and connection. Over the course of the year, the CDO and DEI organization sought to align leaders and employees across the company to the refreshed DEI strategy. Highlights from our 2023 DEI accomplishments include:

Launching our refreshed DEI strategy;
Reviewing the results of the 2023 Perspectives survey and continuing to integrate the insights into our DEI efforts;
Updating governance and membership for both global and business unit and functional DEI Councils;
Enhancing our Employee Networks by clarifying their strategic intent and creating a consistent sponsorship structure;
Hosting workshops tailored to business units to further educate on the definitions of DEI; and
Developing a training called DEI Foundations and launching it to senior leadership.

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MEASURING OUR PROGRESS
We actively monitor diversity metrics on a global basis. We are committed to being transparent as we build a more diverse and inclusive workplace. Starting in 2019, we published our first DEI Dashboards internally, which contained key DEI statistics for our global and U.S. employees. In keeping with our annual process, we continue to update the dashboards with global and U.S. workforce metrics and industry benchmark data to help compare our internal metrics against the external market and our peers.

Making the data visible is an important step in our DEI journey, but what we do with this information is what matters. Our CDO and DEI Council, in conjunction with the ELT, review these metrics and identify appropriate plans and priorities to address trends. We also continue to educate and inform our workforce on underlying trends to raise awareness.

Externally, we publish our workforce metrics and HCM disclosures in our Consolidated EEO-1 Reports, Sustainability Report and Human Capital Management Report.

We know that for DEI to be sustainable, we need programs and processes that are disciplined, and promote fair, consistent, and equitable treatment of all employees. By ensuring equity in our people-related programs and processes, we can help advance DEI within the company. Some of our focus areas include:

Performance management: Assigning all employees a “how” rating as part of our performance management process to hold our workforce and our leaders accountable for behaviors, including those that advance DEI.
Recognition: Awarding a prestigious SPIRIT of Performance Award for DEI advocates.
Employee Networks: Sponsoring broad participation in our extensive Employee Networks and aligning their work to our DEI pillars.

Spotlight Story:  
 
   LIFT off!   
In March 2023, more than 130 petrotechnical employees from around the world gathered in Houston for a special learning event, Learning and Innovation for Today and Tomorrow or “LIFT.” LIFT originated in 2019 and is a technical training event for global petrotechnical professionals designed to promote employee engagement, foster innovation, reinforce leadership skills, and drive cross-discipline collaboration and networking.

LIFT participants came from a variety of backgrounds and business units, ranging from Geoscience to HSE, and Lower 48 to Qatar. Early and mid-career employees were nominated to participate in the program to build knowledge and expand their networks.

Participants left with new problem-solving techniques and enhanced communications skills to help convey complex, technical ideas. Importantly, participants formed connections with peers across the globe.

Attracting a World-Class Workforce

Our success depends on having the right workforce to meet our business needs. Attracting a skilled, engaged, and diverse workforce is a top priority. We have taken significant actions to embed equity and inclusion into our recruiting practices, from adapting the way we construct job descriptions to striving for our recruiting pipelines to reflect the diversity of the communities in which we operate. To attract top talent for full-time positions and internships, we recruit from a number of universities in the U.S. By attending conferences and recruiting at Hispanic-serving institutions and HBCUs, we continue broadening our pipeline of talent. We closely monitor recruitment metrics through our university and experienced hire dashboards in areas such as gender, ethnicity, and acceptance rates to observe the diversity composition of the candidate pool from application to offer. In addition, voluntary attrition metrics are routinely tracked and disclosed to guide our retention activities, as necessary. We believe our Employee Networks, our emphasis on talent development, and our commitment to DEI, create an environment that promotes retention of our workforce.

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Valuing our People

EMPLOYEE ENGAGEMENT AND DEVELOPMENT

Developing our world-class workforce is a critical focus for ConocoPhillips. We want employees to feel valued and to add value. Our workforce is developed through a combination of on-the-job learning, formal training, and regular feedback and mentoring. Skill-based TMTs guide employee development and career progression by skills and location. The TMTs help identify our future business needs and assess the availability of critical skill sets within ConocoPhillips. Annually, business leadership and TMTs meet to review succession benches, calibrate talent, and provide recommendations to executive leadership and the Board on future leadership roles that will promote business continuity. We use a performance management program focused on objectivity, credibility, and transparency. The program includes broad stakeholder feedback, real-time recognition, and a formal rating to assess behaviors to ensure they are in line with our SPIRIT Values. Supervisors have access to a voluntary 360-feedback tool to receive feedback on their strengths and opportunities relative to these competencies. We also offer training on a broad range of technical and professional skills, from data analytics to communication skills.

Taking steps to measure and assess employee satisfaction and engagement is at the heart of long-term business success and creating a great place to work for our global workforce. Since 2019, the ConocoPhillips Perspectives Survey has been our primary listening platform for gathering feedback on employee sentiment and strengthening our “Who We Are” culture. Leaders analyze the survey data and comments and then identify focus areas for action at both the enterprise and local level. In 2023, our Perspectives survey touched on key themes related to employee satisfaction, company strategy, leadership, career development, DEI, and well-being. We transparently share our survey results internally with global employees, and we also disclose key metrics externally in our HCM report. We look for incremental progress on key drivers of employee satisfaction over time and leverage global and industry benchmark data to help provide transparency on our internal metrics against our peers.

COMPENSATION, BENEFITS, AND HEALTH AND WELL-BEING

The HRCC oversees many of our employee compensation programs. Our compensation programs are competitive with local markets and are comprised of a base pay rate, the annual Variable Cash Incentive Program (“VCIP”) and, for eligible employees, the Restricted Stock Unit (“RSU”) program. From the CEO to the frontline worker, every employee participates in VCIP, which aligns employee compensation with ConocoPhillips’ success on critical performance metrics and also recognizes individual performance. Our RSU program is designed to attract and retain employees, reward performance, and align employee interest with stockholders by encouraging stock ownership. Our retirement and savings plans are intended to support employees’ financial futures and are competitive within local markets. Our benefits program provides coverage for families requiring disability support, elder care, and child care, including onsite child care, where access locally is a challenge.

   External Recognition  
 
 
  
Forbes’ World's Best Employers 2023
Fortune’s 2023 World’s Most Admired Companies
Newsweek’s America’s Greatest Workplaces 2023

Public Policy Engagement

Legislators and regulators govern all aspects of our industry and have considerable influence on our success. Accordingly, senior leadership and our Board encourage involvement in governmental activities that advance ConocoPhillips’ goals. As a company, we engage in activities that include lobbying government officials, contributing to candidates and political organizations from our corporate treasury and our employee political action committee, and participating in trade associations in order to champion policy solutions that are in the best interests of the company.

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The Board’s Public Policy and Sustainability Committee has approved policies and guidelines to help ConocoPhillips maintain alignment with our SPIRIT Values, policy principles, and compliance with local, state, and federal laws that govern corporate involvement in activities of a political or public policy nature. The Board’s Public Policy and Sustainability Committee also has oversight of these plans and processes. In addition, all of these activities are carefully managed by our Government Affairs division in an effort to yield the best business result for ConocoPhillips and to satisfy the various reporting requirements. To learn more about our public policy engagement and view our disclosures related to candidates, political organizations, and trade associations, please visit www.conocophillips.com under “Sustainability > Integrating Sustainability > Sustainable Development Governance > Policies and Positions.”

Communications with the Board of Directors

Stockholders and interested parties may write or call our Board by contacting our Corporate Secretary as provided below:


Write to:


Call:

Email:

Annual Meeting Website:

ConocoPhillips
Board of Directors
c/o Corporate Secretary
ConocoPhillips
P.O. Box 4783
Houston, TX 77210-4783

(281) 293-3030

boardcommunication@
conocophillips.com

www.conocophillips.com/
annualmeeting

Relevant communications will be distributed to the full Board or to individual directors, as appropriate. The Corporate Secretary will not forward business solicitations or advertisements, junk mail and mass mailings, new product suggestions, product complaints, product inquiries, résumés, and other forms of job inquiries, surveys, or communications that are unduly hostile, threatening, illegal, or similarly unsuitable. Any communication that is filtered out is available to any director upon request.

Director Compensation

Our non-employee director compensation program consists primarily of an equity component and a cash component, which is detailed below.

Objectives and Principles

The Board’s goal in designing non-employee director compensation is to provide a competitive program that will enable us to attract and retain highly skilled individuals with relevant experience to oversee ConocoPhillips’ strategic direction. Our compensation program also reflects the time and talent required to serve on the board of a complex, multinational corporation. The Board seeks to provide sufficient flexibility in the form of compensation to meet directors’ varying needs while ensuring that a substantial portion of compensation is linked to the long-term success of ConocoPhillips.

The Board approves levels of compensation after a recommendation from the Committee on Directors’ Affairs, which conducts an annual review with an independent compensation consultant. In 2023, the Committee on Directors’ Affairs met with an independent compensation consultant to review the non-employee director compensation program and to determine whether to recommend any changes to that program. The review included comparisons of director compensation levels with the compensation reference group. See “Process for Determining Executive Compensation — Setting Target Compensation Compensation Reference Group” beginning on page 79. The consultant noted that our director compensation program was within the limits set out in the stockholder-approved 2023 Omnibus Stock and Performance Incentive Plan under which director awards are made. Effective July 1, 2023, the Board approved, on the basis of benchmarking data, the following compensation changes:

Increase the cash compensation for the Lead Director from $45,000 to $50,000
Increase the cash compensation for the Chair of the Committee on Directors’ Affairs from $15,000 to $20,000

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Equity Compensation

Non-employee directors receive an annual grant of restricted stock units with an aggregate value of $220,000 on the date of grant. The restricted stock units are fully vested at grant and are credited with dividend equivalents in the form of additional restricted stock units, but they cannot be sold or otherwise transferred. In the case of any newly elected directors, the initial annual equity grant is prorated for the year of election from and including the month of election.

Prior to each annual grant, a director may elect the schedule on which the transfer restrictions will lapse. When restrictions lapse, a director will receive unrestricted shares of ConocoPhillips stock in exchange for his or her restricted stock units. Regardless of the schedule a director elects, all restrictions on a director’s restricted stock units will lapse in the event of the director’s retirement, disability, or death, or upon a change in control of ConocoPhillips, unless the director has elected to defer receipt of the shares until a later date. Directors forfeit restricted stock units if, before restrictions lapse (and prior to any change in control), the Board finds sufficient cause for forfeiture.

Cash Compensation

The non-employee director compensation program, as approved by the Board, consists of the following cash compensation:

Non-employee director annual cash compensation — $115,000
Lead Director — $50,000(1)
Chair of the Audit and Finance Committee — $35,000
Chair of the Human Resources and Compensation Committee — $27,500
Chair of the Public Policy and Sustainability Committee — $27,500
Chair of the Committee on Directors’ Affairs — $20,000(1)
All other Audit and Finance Committee members — $10,000
All other Human Resources and Compensation Committee members — $7,500
All other Public Policy and Sustainability Committee members — $7,500
All other Committee on Directors’ Affairs members — $5,000

This cash compensation is payable in monthly installments. Each director may elect, on an annual basis, to receive all or part of the cash compensation in unrestricted stock or restricted stock units or to have the amount credited to a deferred compensation account. Any such unrestricted stock or restricted stock units will be issued on the last business day of each month and valued using the average of the high and the low market prices of ConocoPhillips common stock on such date. The restricted stock units issued in lieu of cash compensation are subject to the same restrictions as the annual restricted stock units described under “Equity Compensation” above.

(1)
For the period January 2023 to June 2023, the additional cash compensation for the Lead Director and Chair of Committee on Directors’ Affairs was $45,000 and $15,000, respectively.

Deferral of Compensation

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

Matching Gift Program

Active non-employee directors are eligible to participate in the ConocoPhillips Matching Gift Program. This program provides a dollar-for-dollar match of a donation of cash or securities (up to a maximum of $10,000 annually per donor) to tax-exempt charities and educational institutions, excluding religious, political, fraternal, or athletic organizations. The Board believes the Matching Gift Program is consistent with ConocoPhillips’ commitment to social responsibility.

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Other Compensation

We provide transportation or reimburse the cost of transportation when a non-employee director travels on ConocoPhillips business, including to attend meetings of the Board or a committee. From time to time, spouses and other guests of directors may be invited to attend certain meetings at the request of the Board. The Board believes this creates a collegial environment that enhances the effectiveness of the Board. If spouses or other guests are invited to attend meetings, ConocoPhillips reimburses directors for the out-of-pocket cost of the additional travel and related incidental expenses. Any such reimbursement is treated by the Internal Revenue Service as taxable income to the applicable director. Non-employee directors do not receive gross-ups to compensate for the resulting income taxes except in connection with the presentation of a retirement gift.

Stock Ownership

Each non-employee director is expected to own ConocoPhillips stock in the amount of the aggregate annual equity grants received during his or her first five years on the Board. Directors are expected to reach this level of target ownership within five years after joining the Board. Actual shares of stock, restricted stock, or restricted stock units, including deferred stock units, may be counted in satisfying the stock ownership guidelines. The holdings of each of our directors currently meet or exceed these guidelines.

Non-Employee Director Compensation Table(1)

Name    Fees Earned
or Paid in
Cash(2)
   Stock
Awards
(3)(4)
   Option
Awards
   Non-Equity
Incentive Plan
Compensation
   Change in
Pension
Value and
Nonqualified
Deferred
Compensation
on Earnings
   All Other
Compensation(5)
   Total
D.V. Arriola     $ 132,500 $ 220,050     $              $              $            $ 10,000 $ 362,550
C.M. Devine (retired)(6) 53,125 220,050 30,790 303,965
J. Freeman (resigned)(7) 98,333 220,050 318,383
G. Huey Evans 129,583 220,050 26,218 375,851
J.A. Joerres 147,500 220,050 367,550
W.H. McRaven 132,500 220,050 352,550
S. Mulligan 132,500 220,050 352,550
E.D. Mullins 138,049 220,050 10,000 368,099
A.N. Murti 157,500 220,050 377,550
R.A. Niblock 188,274 220,050 10,000 418,324
D.T. Seaton 127,500 220,050 347,550
R.A. Walker 132,500 220,050 352,550
(1)

Ryan Lance and Timothy Leach serve as directors and also as employees of ConocoPhillips. They are not included in this table because all of the compensation they receive from the company is for services they provide as employees; they do not receive any additional compensation for their services as directors. The compensation Mr. Lance received as an employee is summarized starting on page 98. Mr. Leach is not an executive officer, and the compensation he received as an employee in 2023 is summarized below.

Salary: $723,348(a)
Bonus: $1,500,000(b)
Stock Awards: $2,201,851(c)
Non-Equity Incentive Plan Compensation: $780,492(d)
Change in Pension Value and Nonqualified Deferred Compensation Earnings: $0
All Other Compensation: $377,660(e)
Total: $5,583,351

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(a) Includes any amounts that were voluntarily deferred under the Key Employee Deferred Compensation Plan.
(b)
Includes the first installment of the payment due under the non-compete, non-solicitation, and confidentiality agreement as outlined in Exhibit 10.1 to our Quarterly Report on Form 10-Q for the period ending June 30, 2022. If Mr. Leach breaches this agreement, he is required to repay any amounts previously paid to him under the agreement.
(c)
Amount represents the aggregate grant date fair value of awards made under the Performance Share Program (“PSP”) and the Executive Restricted Stock Unit Program (“ERSUP”), as determined in accordance with FASB ASC Topic 718. See the “Employee Benefit Plans” section of Note 16 in the Notes to Consolidated Financial Statements in ConocoPhillips’ 2023 Annual Report on Form 10-K for a discussion of the relevant assumptions used in this determination. For the awards granted for PSP 23 and for 2023 restricted stock units (“RSUs”) under the ERSUP, the grant date fair value was $112.50, but as noted in the Equity Grant Practices outlined on page 95 awards are granted using the average of the closing prices on the 10 trading days preceding the date of grant ($112.658). The difference between these values can increase or decrease the reported amounts from year to year even if target compensation does not change. For 2023, Mr. Leach received a grant of 6,835 RSUs under the ERSUP with a value of $768,938. Mr. Leach received a target grant of 12,737 performance stock units for PSP 23 for the January 2023 – December 2025 performance period with a value of $1,432,913. The PSP grant is valued at target because it is most probable at the setting of the target for the applicable performance periods that targets will be achieved. If payout was made at maximum levels for company performance the number of performance stock units and value would double from the target, although the value of the actual payout would be dependent upon the stock price and accrued dividend equivalent units at the time of the payout. If payout was made at minimum levels, the number of performance stock units and value would be reduced to zero.
(d)
The amount shown includes amounts paid under the Variable Cash Incentive Program (“VCIP”).
(e)
Includes $107,926 related to pre-approved personal travel on company aircraft, based on the approximate aggregate incremental cost to ConocoPhillips for such personal use, including travel for any family member or personal guest. Approximate aggregate incremental cost has been determined by calculating the variable costs for each aircraft during the year, dividing that amount by the total number of miles flown by that aircraft, and multiplying the result by the miles flown for personal use during the year. However, where there were identifiable costs related to a particular trip — such as fuel, airport landing fees or food and lodging for aircraft personnel who remained at the location of the personal trip — those amounts are separately determined and included. The amounts shown include incremental costs associated with flights to the hangar or other locations without passengers (commonly referred to as “deadhead” flights) arising from the non-business use of the aircraft. Mr. Leach has entered into an aviation lease agreement with the company under which reimbursement, subject to FAA limitations, is provided for certain flights which are personal in nature. Amounts included reflect aggregate incremental cost net of reimbursements. Lease reimbursements are allocated to the flight to which they relate but may be paid in a different year due to lease administration. Also includes $4,349 for the aggregate incremental cost of premiums paid by ConocoPhillips for executive group life insurance (coverage equal to two times annual salary) versus the cost of basic life insurance provided to non-executive employees (coverage equal to annual salary). Also includes $59,400 of company contributions under the company’s tax qualified savings plan. Under the terms of its tax-qualified defined contribution plan, ConocoPhillips makes matching contributions and nonelective allocations to the accounts of its eligible employees, including Mr. Leach. Mr. Leach is fully vested in his benefits under the company’s tax-qualified defined contribution plan. Also includes $126,641 of company contributions to non-qualified defined contribution plans. Under the terms of its nonqualified defined contribution plans, ConocoPhillips makes contributions to the accounts of its eligible employees, including Mr. Leach. His contributions under the nonqualified defined contribution plans include matching and company retirement (in lieu of pension) contributions that cannot be made to the company’s tax qualified defined contribution plan due to limitations imposed by the Internal Revenue Code. Mr. Leach is fully vested in his benefit under the company’s nonqualified defined contribution plans. The company’s defined contribution nonqualified deferred compensation plans allow hypothetical investment of deferred amounts in a broad range of mutual funds or other market-based investments, including ConocoPhillips stock. As market-based investments, none of these provide above-market return. Also includes $4,730 of other perquisites and personal benefits including the cost of presentations made to employees and their spouses at company meetings or events, reimbursements for the cost of spousal and other guests attendance at such meetings or events, and the aggregate incremental cost of any other personal benefits or perquisites not integrally and directly related to the performance of the executive’s duties arising from such presentations, meetings, or events, primarily food, drink and transportation. Also includes $60,780 in security costs, primarily related to protection services provided under our Comprehensive Security Program if a risk assessment indicated that enhanced procedures were warranted. Amounts also include $13,834 for tax gross up payments by ConocoPhillips relating to certain taxes incurred by the employee. These taxes arise primarily when ConocoPhillips requests family members or other guests to accompany the employee to a function, and, as a result, the employee is deemed to make a personal use of company assets (for example, when a spouse accompanies an employee on a company aircraft). ConocoPhillips believes such expenses are appropriately characterized as a business expense, and, if the employee has imputed income in accordance with the applicable tax laws, ConocoPhillips will generally reimburse any increased tax costs.

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As of December 31, 2023, Mr. Leach had 26,439(i) Shares or Units of Stock that Have Not Vested and 51,039(ii) Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested. Outstanding equity awards made to Mr. Leach include long-term incentive awards payable under the PSP and long-term time-vested awards under the ERSUP. Awards continue to have restrictions upon transferability. The market value of these awards as of December 31, 2023 (see footnotes i and ii below) is based on a market value of $116.07 per share (the closing stock price of the company’s common stock on December 29, 2023). The number of shares or units shown is rounded to the nearest whole share, but the related value is based on the actual number of shares (including fractional shares), with aggregate value rounded to the nearest dollar.
(i) Includes 19,624 RSUs related to the grant in 2022 under the ERSUP and 6,815 RSUs related to the grant in 2023 under the ERSUP. These awards have a market value as of December 31, 2023, of $3,068,804. Under the ERSUP, stock awards are made in the form of RSUs. The terms and conditions of those units require restriction on transferability, which lapse three years from the anniversary of the grant date. Forfeiture is expected to occur at separation from service if the separation is not the result of death, disability, layoff, or retirement after the executive has reached the age of 55 with five years of service, or after a change in control, although the HRCC has the authority to waive forfeiture. Upon lapse of restrictions, settlement is made in stock. RSUs have no voting rights. Dividend equivalents, if any, on RSUs held are reinvested in additional RSUs. Dividend equivalents are paid at the same time and the same rate as dividends on common stock are paid, not at a preferential rate.
(ii) Includes 37,849 target performance unit awards under the PSP for the ongoing performance period beginning January 2022 and 13,189 target performance unit awards under the PSP for the ongoing performance period beginning January 2023. Based on target performance, these awards have a market value as of December 31, 2023, of $5,924,055. There is no assurance that these awards will be granted at, below, or above target after the end of the relevant performance periods because determination of whether to make an actual grant to, and the amount of any actual grant for Mr. Leach is within the discretion of the HRCC. Mr. Leach’s awards under the PSP are made in the form of performance stock units that are subject to restrictions on transferability that lapse three years after the grant date. Forfeiture is expected to occur if the separation is not the result of death, disability, layoff, or retirement after the executive has reached the age of 55 with five years of service, or after a change in control, although the HRCC has the authority to waive forfeiture. The awards will be settled in cash and have no voting rights. The awards accrue dividend equivalents that, during the performance period, are reinvested in additional performance stock units. Dividends or dividend equivalents are not paid at preferential rates, and dividend equivalents are paid at the same time as dividends on common stock.
In 2023, Mr. Leach had 70,918 shares acquired on award vesting and delivery at a realized value of $8,521,585. This value includes restricted stock units for the ERSUP award in 2023 for which restrictions were lapsed in order to satisfy required tax withholding. Also includes restricted stock units for an inducement award granted in 2021 for which the second half vested on the second anniversary of the grant date.
(2)

The non-employee director compensation program, as approved by the Board, consists of the following cash compensation:

Non-employee director annual cash compensation — $115,000
Lead Director — $50,000(a)
Chair of the Audit and Finance Committee — $35,000
Chair of the Human Resources and Compensation Committee — $27,500
Chair of Public Policy and Sustainability Committee — $27,500
Chair of Committee on Directors’ Affairs — $20,000(a)
All other Audit and Finance Committee members — $10,000
All other Human Resources and Compensation Committee members — $7,500
All other Public Policy and Sustainability Committee members — $7,500
All other Committee on Directors’ Affairs members — $5,000
(a) For the period January 2023 to June 2023 the additional cash compensation for the Lead Director and Chair of Committee on Directors’ Affairs was $45,000 and $15,000 respectively.

Amounts shown include prorated amounts attributable to time served on the board and committee assignments, which may occur during the year. Amounts shown in the Fees Earned or Paid in Cash column include any amounts that were voluntarily deferred to the Director Deferral Plan, received in ConocoPhillips common stock, or received in restricted stock units. Mr. Mullins received 100 percent of his cash compensation in restricted stock units in 2023, and Mr. Niblock received 50 percent of his cash compensation in restricted stock units in 2023, with an aggregate grant date fair value as shown in the table. All other directors received their cash compensation in cash or deferred such amounts into the Director Deferral Plan.

(3)

Amounts represent the aggregate grant date fair value of stock awards granted under our non-employee director compensation program. For active non-employee directors, on January 15, 2023, each received a 2023 annual grant of restricted stock units with an aggregate value of $220,000 based on the average of the high and low price for our common stock, as reported on the NYSE, on the grant date. These grants are made in whole shares, with fractional share amounts rounded up, resulting in a grant of shares with a value of $220,050 to each non-employee director who was a director on January 15, 2023.

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(4) The following table reflects, for each non-employee director, the aggregate number of stock awards outstanding as of December 31, 2023:
Name       Number of Deferred Shares
or Units of Stock
D.V. Arriola       2,583
C.M. Devine (retired) 18,777
J. Freeman (resigned) 25,914
G. Huey Evans 44,162
J.A. Joerres 19,077
W.H. McRaven 17,967
S. Mulligan 20,556
E.D. Mullins 16,131
A.N. Murti 49,318
R.A. Niblock 83,997
D.T. Seaton 10,057
R.A. Walker 10,057

 The following table lists delivery of non-employee director stock awards in 2023:

Name       Number of Shares
Acquired on Award
Delivery
      Value Realized
Upon Award
Delivery
D.V. Arriola                    $
C.M. Devine (retired) 3,628 396,305
J. Freeman (resigned) 1,849 197,217
G. Huey Evans
J.A. Joerres
W.H. McRaven
S. Mulligan 1,849 197,217
E.D. Mullins
A.N. Murti
R.A. Niblock
D.T. Seaton
R.A. Walker
(5) The following table reflects, for each non-employee director, the items contained in All Other Compensation.

Name       Tax
Reimbursement
Gross-Up(a)
      Retirement
Gifts(b)
      Other
Compensation(c)
      Matching Gift
Amounts(d)
      Total
D.V. Arriola              $      $               $          $ 10,000 $ 10,000
C.M. Devine (retired) 10,640 10,150 10,000 30,790
J. Freeman (resigned)
G. Huey Evans 26,218 26,218
J.A. Joerres
W.H. McRaven
S. Mulligan
E.D. Mullins 10,000 10,000
A.N. Murti
R.A. Niblock 10,000 10,000
D.T. Seaton
R.A. Walker

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Corporate Governance at ConocoPhillips

       (a) The amounts shown are for payments by ConocoPhillips relating to certain taxes incurred by the director for imputed income. These occurred when a retirement presentation was made to Ms. Devine upon her retirement from the Board. ConocoPhillips has a practice of making gift presentations to its retiring directors, especially those of long service. The fair value of the retirement presentation was imputed to Ms. Devine’s income. In such circumstances, if a director is imputed income in accordance with applicable tax laws, ConocoPhillips generally will reimburse the director for the resulting increased tax costs. All such tax reimbursements have been included above, regardless of whether the corresponding perquisite or personal benefit is required to be reported pursuant to SEC rules and regulations.
  (b) The amount shown is the fair value of the retirement presentation and cost for Ms. Devine. ConocoPhillips has a practice of making gift presentations to its retiring directors, especially those of long service.
  (c) The amounts shown are imputed amounts when, following a board meeting, the director was returned to a location other than their point of origin or their tax home and therefore considered to be a personal accommodation or when, in route to or from a board meeting, a personal accommodation was made to make more efficient use of a director’s time and travel requirements.
  (d) ConocoPhillips maintains a Matching Gift Program under which we match certain gifts by directors to charities and educational institutions, excluding religious, political, fraternal, or athletic organizations, that are tax-exempt under Section 501(c)(3) of the Internal Revenue Code of the United States or meet similar requirements under the applicable law of other countries. For active directors, the program matches up to $10,000 in each program year. Administration of the program can cause us to pay more than $10,000 in a single fiscal year due to a lag in processing claims. The amounts shown are for the actual payments by ConocoPhillips in 2023. As indicated above, Mr. Lance and Mr. Leach are eligible for the Matching Gift Program as employees rather than as directors.

(6) Ms. Devine retired from the Board effective May 16, 2023. The amounts in the table above include her prorated compensation reflecting the portion of 2023 that she served as a director.
(7) Ms. Freeman resigned from the Board effective August 3, 2023. The amounts in the table above include her prorated compensation reflecting the portion of 2023 that she served as a director.

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Audit and Finance Committee Report

The Audit and Finance Committee (the “Audit Committee”) assists the Board in fulfilling its responsibility to provide independent, objective oversight for ConocoPhillips’ financial reporting functions and internal control systems.

The Audit Committee currently consists of six non-employee directors. The Board has determined that each member of the Audit Committee satisfies the requirements of the NYSE as to independence and financial literacy. The Board has determined that at least one member, Arjun N. Murti, is an audit committee financial expert as defined by the SEC.

The responsibilities of the Audit Committee are set forth in the written charter adopted by the Board and last amended on October 4, 2019. The charter is available on our website at www.conocophillips.com under “Investors > Corporate Governance.”

THE AUDIT COMMITTEE’S RESPONSIBILITIES INCLUDE:
Discussing with management, the independent auditors, and the internal auditor the integrity of ConocoPhillips’ accounting policies, internal controls, financial statements, financial reporting practices, and select financial matters, including capital structure, complex financial transactions, financial risk management, retirement plans, and tax planning;
Reviewing, and coordinating the review by other committees of, significant corporate risk exposures and steps management has taken to monitor, control, and report such exposures;
Reviewing the qualifications, independence, and performance of our independent auditors and the qualifications and performance of our internal auditors and chief compliance officer;
Reviewing ConocoPhillips’ overall direction and compliance with legal and regulatory requirements and internal policies, including our Code of Business Ethics and Conduct;
Assisting the Board in fulfilling its oversight of enterprise risk management, particularly with respect to: (1) market-based risks; (2) financial reporting; (3) effectiveness of information systems and cybersecurity; and (4) commercial trading;
Discussing with management and the Chief Compliance Officer the implementation and effectiveness of our global compliance and ethics program; and
Maintaining open and direct lines of communication with the Board and management, our Compliance and Ethics Office, the internal auditors, and the independent auditors.

Management is responsible for preparing ConocoPhillips’ financial statements in accordance with generally accepted accounting principles, or GAAP, and for developing, maintaining, and evaluating our internal controls over financial reporting and other control systems. The independent registered public accounting firm is responsible for auditing the annual financial statements prepared by management, assessing the internal control over financial reporting, and expressing an opinion with respect to each.

One of the Audit Committee’s primary responsibilities is to assist the Board in its oversight of the integrity of ConocoPhillips’ financial statements. The following report summarizes certain of the Audit Committee’s activities in this regard for 2023.

Review with Management. The Audit Committee reviewed and discussed with management the audited consolidated financial statements included in ConocoPhillips’ Annual Report on Form 10-K for the year ended December 31, 2023, which included a discussion of the quality — not just the acceptability — of the accounting principles, the reasonableness of significant judgments, and the clarity of the disclosures. The Audit Committee also discussed management’s assessment of the effectiveness of our internal control over financial reporting as of December 31, 2023, included in the financial statements.

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Audit and Finance Committee Report

Discussions with Internal Audit. The Audit Committee reviewed ConocoPhillips’ internal audit plan and discussed the results of internal audit activity throughout the year. ConocoPhillips’ General Auditor met with the Audit Committee at every in-person meeting in 2023 and was available to meet without management present at each of these meetings.

Discussions with the Independent Registered Public Accounting Firm. The Audit Committee met throughout the year with Ernst & Young LLP (“EY”), ConocoPhillips’ independent registered public accounting firm, including meeting with EY at each in-person meeting; EY was also available to meet without management present at each of these meetings. The Audit Committee has discussed with EY the matters required to be discussed by standards of the Public Company Accounting Oversight Board, or PCAOB. The Audit Committee has received the written disclosures and the letter from EY required by PCAOB rules and has discussed with EY its independence from ConocoPhillips. In addition, the Audit Committee considered the non-audit services EY provides to ConocoPhillips and concluded that EY’s independence has been maintained.

Recommendation to the ConocoPhillips Board of Directors. Based on its review and discussions noted above, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in ConocoPhillips’ Annual Report on Form 10-K for the year ended December 31, 2023.

THE CONOCOPHILLIPS AUDIT AND FINANCE COMMITTEE

Arjun N. Murti, Chair
Dennis V. Arriola
William H. McRaven
Sharmila Mulligan
Eric D. Mullins
R.A. Walker

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Item 2: Proposal to Ratify the Appointment of Ernst & Young LLP


      What am I Voting On?
       
 

The Audit Committee has appointed EY to serve as ConocoPhillips’ independent registered public accounting firm for fiscal year 2024. You are voting on a proposal to ratify such appointment.

What are the Audit Committee’s responsibilities with respect to the Independent Registered Public Accounting Firm?

The Audit Committee is directly responsible for the appointment, compensation, retention, and oversight of the independent registered public accounting firm retained to audit our financial statements and has the authority to determine whether to retain or terminate the independent auditor.

The Audit Committee reviews the experience and qualifications of the senior members of the independent auditor’s team and is directly involved in the appointment of the lead audit partner. Neither the lead audit partner nor the reviewing audit partner performs audit services for ConocoPhillips for more than five consecutive fiscal years. The Audit Committee is also responsible for determining and approving the audit engagement fees and other compensation associated with retaining the independent auditor.

The Audit Committee has evaluated the qualifications, independence, and performance of EY and believes that continuing to retain EY to serve as our independent registered public accounting firm is in the best interest of ConocoPhillips’ stockholders.

What services does the Independent Registered Public Accounting Firm provide?

Audit services of EY for fiscal year 2023 included an audit of our consolidated financial statements, an audit of the effectiveness of our internal control over financial reporting, and services related to periodic filings made with the SEC. Additionally, EY provided certain other services as described below.

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Item 2: Proposal to Ratify the Appointment of Ernst & Young LLP

How much was the Independent Registered Public Accounting Firm paid for 2023 and 2022?

EY’s fees for professional services totaled $13.7 million for 2023 and $13.7 million for 2022. EY’s fees for professional services included the following:

Audit Fees — fees for audit services, which related to the fiscal year consolidated audit, the audit of the effectiveness of internal controls, quarterly reviews, registration statements, comfort letters, statutory and regulatory audits, and related accounting consultations, were $12.7 million for 2023 and $12.1 million for 2022.
Audit-Related Fees — fees for audit-related services, which consisted of audits in connection with benefit plan audits, other subsidiary audits, special reports, asset dispositions, and related accounting consultations, were $0.9 million for 2023 and $1.5 million for 2022.
Tax Fees — fees for tax services, which consisted of tax compliance services and tax planning and advisory services, were $0.1 million for 2023 and $0.1 million for 2022.
All Other Fees — fees for other services were negligible in 2023 and 2022.

The Audit Committee has considered whether the non-audit services provided to ConocoPhillips by EY impaired EY’s independence and concluded they did not.

Who reviews these services and fees?

The Audit Committee has adopted a pre-approval policy that provides guidelines for the audit, audit-related, tax, and other non-audit services that EY may provide to ConocoPhillips. The policy (1) identifies the guiding principles that must be considered by the Audit Committee in approving services to ensure that EY’s independence is not impaired; (2) describes the audit, audit-related, tax, and other services that may be provided and the non-audit services that are prohibited; and (3) sets forth pre-approval requirements for all permitted services. Under the policy, all services to be provided by EY must be pre-approved by the Audit Committee. The Audit Committee has delegated authority to review and approve services to its Chair. Any such approval must be reported to the entire Audit Committee at the next scheduled Audit Committee meeting.

Will a representative of Ernst & Young be present at the meeting?

One or more representatives of EY will be present at the Annual Meeting. The representative(s) will have an opportunity to make a statement and will be available to respond to appropriate questions from stockholders.

What vote is required to approve this proposal?

Approval of this proposal requires the affirmative vote of a majority of the shares present and entitled to vote on the proposal. If the appointment of EY is not ratified, the Audit Committee will reconsider the appointment.

FOR The Audit and Finance Committee recommends you vote FOR the ratification of the appointment of Ernst & Young LLP as ConocoPhillips’ independent registered public accounting firm for fiscal year 2024.

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Item 3: Advisory Approval of Executive Compensation



      What am I Voting On?
     
 
Stockholders are being asked to vote on the following advisory resolution:
RESOLVED, that the stockholders approve the compensation of ConocoPhillips’ Named Executive Officers as described in the “Compensation Discussion and Analysis” section and in the tabular disclosures regarding Named Executive Officer compensation (together with the accompanying narrative disclosures) in this Proxy Statement.

ConocoPhillips is providing stockholders with the opportunity to vote on an advisory resolution, commonly known as “Say on Pay,” considering approval of the compensation of ConocoPhillips’ Named Executive Officers.

The Human Resources and Compensation Committee, which is responsible for the compensation of our executive officers, has overseen the development of a compensation program designed to attract, retain, and motivate executives who enable us to achieve our strategic and financial goals. The “Compensation Discussion and Analysis” and the tabular disclosures regarding Named Executive Officer compensation, together with the accompanying narrative disclosures, explain the trends in compensation and application of our compensation philosophies and practices for the years presented.

The Board believes that ConocoPhillips’ executive compensation program aligns the interests of our executives with those of our stockholders. Our compensation program is guided by the philosophy that ConocoPhillips’ ability to deliver on our disciplined, returns-focused strategy is driven by superior individual performance. The Board believes we must offer competitive compensation to attract and retain experienced, talented, and motivated employees. In addition, the Board believes employees in leadership roles within the organization are motivated to perform at their highest levels when performance-based pay constitutes a significant portion of their compensation. The Board believes that our philosophy and practices have resulted in executive compensation decisions that are aligned with company and individual performance, are appropriate in value, and have benefited ConocoPhillips and its stockholders.

What is the effect of this resolution?

Because your vote is advisory, it will not be binding upon the Board. However, the Human Resources and Compensation Committee and the Board will take the outcome of the vote into account when considering future executive compensation arrangements.

What vote is required to approve this proposal?

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

FOR The Board recommends you vote FOR the advisory approval of the compensation of ConocoPhillips’ Named Executive Officers.

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Role of the Human Resources and Compensation Committee

Authority and Responsibilities

The HRCC is responsible for providing independent, objective oversight for ConocoPhillips’ executive compensation programs, for developing and overseeing the development of a succession management plan for the CEO and Senior Officers, and for determining the compensation of our Senior Officers. Our internal guidelines define a Senior Officer as an employee who is a senior vice president or higher, any executive who reports directly to the CEO, or any other employee considered an officer under Section 16(b) of the Securities Exchange Act of 1934. As of December 31, 2023, ConocoPhillips had 18 active Senior Officers. In addition, the HRCC acts as administrator of the compensation programs and certain of the benefit plans for Senior Officers and as an avenue of appeal for current and former Senior Officers disputing compensation or certain benefits. Finally, the HRCC assists the Board in overseeing the integrity of ConocoPhillips’ executive compensation practices and programs described in the “Compensation Discussion and Analysis” beginning on page 66.

A complete listing of the authority and responsibilities of the HRCC is set forth in the written charter adopted by the Board and last amended on October 9, 2020, which is available on our website at www.conocophillips.com under “Investors > Corporate Governance.”

Members

The HRCC currently consists of six members. All members must meet the independence requirements for “non-employee” directors under the Securities Exchange Act of 1934, for “independent” directors under the NYSE Listed Company Manual, and for “outside” directors under the Internal Revenue Code. The members of the HRCC and the member to be designated as Chair are reviewed and recommended annually by the Committee on Directors’ Affairs to the full Board.

Meetings

The HRCC holds regularly scheduled meetings in association with each regular Board meeting and meets by teleconference between such meetings as necessary. In 2023, the HRCC had 7 meetings. The HRCC reserves time at each regularly scheduled meeting to review matters in executive session with no members of management or management representatives present except as specifically requested by the HRCC. Additionally, the HRCC reviews and reports annually on the succession-planning process for the CEO and senior management and meets with the Lead Director at least annually to evaluate the performance of the CEO. More information regarding the HRCC’s activities at such meetings appears in the “Compensation Discussion and Analysis” beginning on page 66.

     The HRCC is committed to a process of continuous improvement in exercising its responsibilities. To that end, the HRCC:
   
 
 
Routinely receives training regarding best practices for executive compensation;
With the assistance of management and consultants, independent compensation consultants, and, when deemed appropriate, independent legal counsel, regularly reviews its responsibilities and governance practices in light of ongoing legal and regulatory changes and trends in corporate governance;
Annually reviews its charter and proposes any desired changes to the Board;
Annually conducts an assessment of its performance that evaluates the effectiveness of its actions and seeks ideas to improve its processes and oversight; and
Regularly reviews and assesses whether our executive compensation programs are having the desired effects without encouraging an inappropriate level of risk.
 

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Compensation Discussion and Analysis

This Compensation Discussion and Analysis describes the material elements of the compensation of our Named Executive Officers (“NEOs”) and describes the objectives and principles underlying ConocoPhillips’ executive compensation programs, the compensation decisions we have recently made under those programs, and the factors we considered in making those decisions.

In 2023, our NEOs included the following:

         
Ryan M. Lance William L. Bullock, Jr. Kelly B. Rose Nicholas G. Olds Dominic E. Macklon(1)
Chairman and Chief
Executive Officer
Executive Vice
President and Chief
Financial Officer

Senior Vice
President, Legal,
General Counsel and
Corporate Secretary

Executive Vice
President, Lower 48

Executive Vice
President, Strategy,
Sustainability
and Technology

         
(1) On February 9, 2024, Mr. Macklon announced his decision to retire effective May 1, 2024.

Table of Contents

Executive Overview       67       Our executive compensation philosophy is focused on linking pay with performance. It is designed to reflect appropriate governance practices, align with the needs of our business, and maintain a strong link between executive pay and successful execution of our strategy.
For an overview of ConocoPhillips and our operations, see page 7 of our Proxy Summary.
2023 Compensation Program Structure 67  
2023 Say on Pay Vote Result, Stockholder
Engagement, and Board Responsiveness
69  
Executing on our Returns-Focused Value
Proposition Delivers Strong Financial and
Operational Performance
71  
Executive Compensation —
Strategic Alignment
72  
Philosophy and Principles of our Executive
Compensation Program
73  
Majority of Executive Compensation is
Performance Based
74  
Components of Executive Compensation 74  
Process for Determining
Executive Compensation
77  
2023 Executive Compensation Analysis
and Results
84  
Other Executive Compensation and Benefits 93  
Executive Compensation Governance 95  

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Compensation Discussion and Analysis

Executive Overview

2023 Compensation Program Structure

Each year the HRCC, advised by its independent compensation consultant and informed by feedback from stockholders, undertakes a rigorous process to establish and review executive compensation. The HRCC believes a substantial portion of our executive compensation should be equity-based and focused on rewarding long-term performance and furthermore, that this approach most closely aligns the interests of our top executives with those of our stockholders.

The four primary elements of our executive compensation program are designed to provide a target total value for compensation that is competitive with our peers and attracts and retains the talented executives necessary to manage a large and complex company like ConocoPhillips. The following chart summarizes the principal components of our executive compensation program and the performance drivers of each element.

2023 Element of Pay Overview Key Benchmarks/Performance Measures
Annual
       
Salary
     
Fixed cash compensation to attract and retain executives and balance at-risk compensation
Range: Salary grade minimum/maximum
     
Benchmarked to compensation reference group median; adjusted for experience, responsibility, performance, and potential
Variable Cash Incentive Program (“VCIP”)
Variable annual cash compensation to motivate and reward executives for achieving annual goals and Strategic Milestones and Energy Transition Milestones that are critical to our strategic priorities
Range: 0% –200% of target
Health, Safety, and Environmental (20%)
Operational (30%)
Financial—Relative Adjusted ROCE (30%)
Strategic Milestones (10%)
Energy Transition Milestones (10%)
One-year performance period
Long-Term Incentive Program (“LTIP”)
Performance
Share
Program
(“PSP”)
(65% of LTIP)
Variable long-term equity-based compensation to motivate and reward executives for achieving multi-year strategic priorities
Granted at beginning of three-year performance period with final cash payout following the conclusion of the performance period based on HRCC assessment of the pre-established corporate performance metrics and stock price value as of the settlement date
Range: 0% –200% of total target award, inclusive of corporate performance adjustments
Relative TSR (60%)
Financial—Relative Adjusted ROCE (40%)
Stock value
          
Three-year performance period
   
 
Executive
Restricted
Stock Unit
Program
(35% of LTIP)
Long-term equity-based compensation designed to encourage executive retention and promote stock ownership while incentivizing absolute performance that is aligned with stockholder interests
Annual award settles in stock on third anniversary of grant date based on the stock value on the settlement date
Range: 0% –100% of target
Stock value
Three-year cliff vesting
 
 
 

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Compensation Discussion and Analysis

2023 SHORT-TERM INCENTIVE (VCIP) PAYOUT: 130% OF TARGET

The HRCC carefully considered the final results of the metrics and, based on multiple reviews throughout the year, approved a payout that reflected the degree of difficulty in achieving the results against the aggressive targets that were established. No individual performance adjustments were made for the NEOs. Following is a summary of the key items considered and deliberated. For additional details, refer to pages 85-91.

Metric

                                                       
HSE – 85%
20% weighting
Operational – 125%
30% weighting      
Financial (Relative Adjusted
ROCE) –
122%
30% weighting    
 
Remained an industry leader among our peers
Experienced an increase in serious incidents, including one fatality
Top quartile Total Recordable Rate (“TRR”) performance among our peers
Fewer process safety events compared to prior year
Zero spills > 100 barrels
Exceeded production target, including delivering record Lower 48 and total company production, while managing inflationary pressures to achieve disciplined capital expenditures below target; however, operating and overhead costs came in above target
Successfully achieved or exceeded all but one operational milestone
Considering the degree of difficulty of the milestones, the record production, and the operational targets as a whole, the HRCC assessed the performance payout at a slightly above target payout
Finished 4th (58th percentile) relative to performance peers (122% per matrix; page 84)
 
 
Strategic Milestones – 200%
10% weighting
Energy Transition
Milestones – 190%
10% weighting 
Significantly progressed the LNG business through advancing new PALNG, NFE and NFS projects, securing several regasification and offtake agreements, and building out our LNG organization by staffing key roles to enable integration and development of commercial strategies
Identified priority environmental and social risks (E&S) and implemented action plans for risk mitigations
Launched our refreshed DEI strategy globally and identified how to assess progress on each component of diversity, equity, and inclusion
Demonstrated meaningful progress toward our Plan for the Net-Zero Energy Transition, including by increasing our GHG intensity reduction target from 40-50% to 50-60%(1) gross operated emissions
Achieved annual GHG emissions intensity aligned with our 2030 target trajectory range
Executed approved MACC projects below allotted capital and cost budget
Advanced multiple low carbon opportunities
 
(1) Using a 2016 baseline.

PSP 21 LONG-TERM INCENTIVE PAYOUT: 151% OF TARGET

Metric

       
TSR (relative)* – 160%
60% weighting           

Financial (Relative Adjusted ROCE) – 137%
40% weighting              

Finished in the 71st percentile relative to performance peers with three-year TSR of approximately 46%
Payout formulaic following matrix (see page 84)
Finished in the 63rd percentile relative to performance peers
Payout formulaic following matrix (see page 84)
   
* See methodology for calculating TSR on pages 82-83.

For additional details, refer to pages 92-93.

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Compensation Discussion and Analysis

2023 Say on Pay Vote Result, Stockholder Engagement, and Board Responsiveness

ConocoPhillips regularly engages in dialogue with stockholders to continue to reinforce our understanding of stockholder views regarding our compensation programs, and stockholder feedback is considered a fundamental part of our success. The Board and the HRCC appreciate these valuable discussions and continue to encourage stockholders to provide feedback about our executive compensation programs as described on page 53 under “Communications with the Board of Directors.”

STRONG SAY ON PAY SUPPORT IN 2023

We continue to remain committed to our stockholder engagement as we value our stockholders’ input on our executive compensation programs. We are pleased with the results of the 2023 say on pay vote, which received support of stockholders representing more than 93% of our outstanding stock. We remain committed to ongoing dialogue with stockholders and other stakeholders to obtain their input on key matters and inform our management and Board about the issues that our stockholders tell us matter most to them.

STOCKHOLDER ENGAGEMENT IN 2023

In line with our commitment to ongoing stockholder engagement, we requested meetings with stockholders representing more than 50 percent of our outstanding stock and participated in engagement meetings with stockholders representing over 40 percent of our outstanding stock and approximately 80% of our institutional investor base. Members of ConocoPhillips’ management from Investor Relations, Executive Compensation, Human Resources, Legal, and Sustainable Development all participated in stockholder meetings. In addition, our Lead Director, Robert A. Niblock participated in a stockholder meeting at the request of one of our largest institutional investors.

BY THE NUMBERS: STOCKHOLDER ENGAGEMENT IN SPRING AND FALL 2023
We contacted stockholders
representing over
We held meetings with stockholders
representing approximately
We held meetings with stockholders
representing approximately

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Compensation Discussion and Analysis

TRACK RECORD OF CONTINUOUS IMPROVEMENT RESPONSIVE TO STOCKHOLDER FEEDBACK

ConocoPhillips has a track record of continuously seeking to evolve our compensation programs to incorporate stockholder feedback, market best practices, and performance and retention considerations. We strive to clarify and simplify our compensation-related disclosures while providing thorough and meaningful details of our process. Below are highlights of recent changes to our compensation programs:

Effective for the 2024 short-term incentive program and PSP, the Financial metric will include both a relative and absolute measure for Adjusted ROCE to better align payouts with the stockholder experience; payouts will continue to be determined on a formulaic basis
Effective for the 2023 short-term incentive program, we eliminated relative Total Shareholder Return (but retained in the long-term program) and increased the weighting of our Financial and Operational measures to further strengthen the link between performance of the company and payouts
Effective for the 2023 short-term incentive program, we created a separately weighted measure for “Energy Transition Milestones” which enhances the link between our climate commitments and our executive compensation programs
Effective in 2023, we increased the CEO’s stock ownership guideline from six to eight times salary
Effective for the 2022 short-term incentive program, we eliminated positive individual performance adjustments for NEOs
Effective in 2021, the company eliminated all grandfathered tax gross-up benefits under our Change in Control Severance Plan(1)
Effective in 2021, the company strengthened our stock ownership guidelines by no longer counting unvested PSP target units toward ownership guidelines while maintaining robust guidelines for NEOs; further, the company does not count unexercised stock options towards ownership guidelines
(1) Executives who became plan participants after the spinoff in 2012 were not eligible for any gross-up payment. The change removes eligibility for any gross-up payments for executives who were plan participants prior to the spinoff in 2012 and who were previously grandfathered.

2023 STOCKHOLDER PROPOSAL – SHARE RETENTION UNTIL RETIREMENT

For the 2023 Proxy Statement, the Comptroller of the State of New York submitted a proposal asking stockholders to vote in favor of requiring NEOs to retain a significant percentage of shares acquired from equity compensation plans until reaching normal retirement age. After evaluating the proposal, the HRCC determined that increasing the CEO’s stock ownership guidelines from six to eight times salary achieved the appropriate balance of being consistent with market practices, which enables us to attract and retain executive talent, and having robust ownership guidelines that align executive compensation with stockholder interests. During engagements in 2023, stockholders were supportive of the change made by the HRCC and did not request any additional changes. The proposal failed to receive significant support in 2023 with less than 23% of stockholders indicating support for the proposal as submitted by the Comptroller of the State of New York.

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Executing on our Returns-Focused Value Proposition Delivers Strong Financial and Operational Performance

Throughout 2023, ConocoPhillips demonstrated that we can deliver strong financial and operational performance consistent with our value proposition of superior returns to stockholders through price cycles while executing against our Triple Mandate to reliably and responsibly deliver oil and gas production to meet energy transition pathway demand, deliver competitive returns on and of capital to our stockholders, and achieve our net-zero operational emissions ambitions.

We delivered full year total and Lower 48 record production of 1,826 thousand barrels and 1,067 thousand barrels of oil equivalent per day, respectively, while we continued to enhance our portfolio diversity by opportunistically acquiring the remaining 50% working interest in Surmont, reaching FID on the Willow project in Alaska and further progressing our global LNG strategy.
We achieved a 17 percent return on capital employed(1) and we delivered competitive returns of capital by distributing $11 billion to stockholders through our three-tier framework, including $5.6 billion in cash through the ordinary dividend and variable return of cash (“VROC”) and $5.4 billion through share repurchases.
We continued to demonstrate our commitment to our net-zero operational emissions ambition by accelerating our GHG emissions-intensity reduction target through 2030 from 40-50% to 50-60%(2) and we were awarded the Oil & Gas Methane Partnership 2.0 Gold Standard Pathway designation.

We continue to be guided by our SPIRIT Values and remain committed to executing our foundational principles —focusing on peer-leading distributions, maintaining a strong balance sheet, executing disciplined investment, and demonstrating responsible and reliable ESG performance. Supporting these core principles are our strategic cash flow allocation priorities: (1) invest enough capital to sustain production and pay the existing dividend; (2) grow the dividend annually; (3) maintain ‘A’ credit rating; (4) return greater than 30 percent of cash from operations to stockholders; and (5) make disciplined investments to enhance returns.

A summary of the many important accomplishments we achieved in 2023 is shown below:

2023 HIGHLIGHTS — DELIVERING ACROSS ALL ELEMENTS OF THE TRIPLE MANDATE
STRATEGY     FINANCIAL     OPERATIONS
Acquired remaining 50% working interest in Surmont
Progressed LNG strategy through expansion in Qatar, FID at PALNG, and regasification agreements in the Netherlands and offtake agreements in Mexico
Awarded Gold Standard Pathway designation by OGMP 2.0
Accelerated GHG emissions-intensity reduction target through 2030(2)
Distributed $11B to stockholders; $5.6B in ordinary dividend and VROC and $5.4B in share repurchases
$11.0B earnings; $9.06 EPS; $10.6B adjusted earnings; $8.77 adjusted EPS(1)
Generated cash provided by operating activities of $20.0B; $21.3B CFO(3); $10.1B FCF(1); ending cash of $6.9B(4)
Announced 2024 expected return of capital of $9.0B
Delivered FY company and Lower 48 record production of 1,826 MBOED and 1,067 MBOED, respectively
Took FID on the Willow project
Achieved first production on projects in Norway, China and Canada
Improved completion pumping efficiencies by 10-15% across the Lower 48
(1)

Adjusted earnings, adjusted EPS, return on capital employed (ROCE), and free cash flow (FCF) are non-GAAP measures. Further information related to these measures as well as reconciliations to the nearest GAAP measure are included in Appendix A.

(2) Using a 2016 baseline.
(3) Cash provided by operating activities was ~$20.0B. Excluding operating working capital change of ~($1.4B), cash from operations (CFO) was over $21.3B. CFO is a non-GAAP measure. Further information related to this measure is included in Appendix A.
(4) Ending cash includes cash, cash equivalents, and restricted cash totaling $5.9B and short-term investments of $1.0B. Restricted cash was $0.3B. Balance excludes $1.0B in long-term investments.

We maintained our ongoing practice of engaging with stockholders throughout 2023 and received consistent feedback that our disciplined, returns-focused strategy is the right one for our business and that our stockholders appreciate our ongoing efforts to increase the transparency and robustness of our disclosures to address the things that they care about most.

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Compensation Discussion and Analysis

Executive Compensation — Strategic Alignment

Our executive compensation programs are designed to align compensation with ConocoPhillips’ disciplined, returns-focused strategy and with the long-term interests of our stockholders. Our compensation metrics support our Triple Mandate and are directly tied to our strategic priorities, which provide comprehensive and integrated support for our value proposition. The following diagram maps each metric to our strategic priorities.


(1) Using a 2016 baseline.

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Compensation Discussion and Analysis

Philosophy and Principles of Our Executive Compensation Program

OUR GOALS

Our goals are to attract, retain, and motivate high-quality employees and to maintain high standards of principled leadership so we can responsibly deliver energy to the world and provide sustainable value for our stakeholders, now and in the future.
OUR PHILOSOPHY — PAY FOR PERFORMANCE

We believe that:

Our ability to responsibly deliver energy and provide sustainable value is driven by superior individual performance;
A company must offer competitive compensation to attract and retain experienced, talented, and motivated employees;
Employees in leadership roles are motivated to perform at their highest levels when performance-based pay is a significant portion of their compensation; and
The use of judgment by the HRCC plays an important role in establishing increasingly challenging corporate performance criteria to align executive compensation with company performance.
OUR STRATEGIC PRINCIPLES

To achieve our goals, we implement our philosophy through the following principles:

Establish target compensation levels that are competitive with the companies that we compete against for executive talent;
Create a strong link between executive pay and successful execution of our strategy;
Encourage prudent risk-taking by our executives;
Motivate performance using compensation to reward specific individual accomplishments;
Retain talented individuals;
Maintain flexibility to better respond to the cyclical energy industry; and
Integrate all elements of compensation into a comprehensive package that aligns goals, efforts, and results throughout the organization.

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Compensation Discussion and Analysis

Majority of Executive Compensation is Performance Based

Our executive compensation programs align pay with performance that advances our strategic priorities and interests of stockholders. As shown below, approximately 91 percent of the CEO’s 2023 target pay and approximately 81 percent of the other NEOs’ 2023 target pay was performance based. Stock-based, long-term incentives make up the largest portion of performance-based pay.


2023 TARGET COMPENSATION FOR CEO

2023 AVERAGE TARGET COMPENSATION FOR OTHER NEOs

Components of Executive Compensation

The four primary elements of our executive compensation program are designed to provide a target total value for compensation that is competitive with our peers and attracts and retains the talented executives necessary to manage a large and complex organization such as ConocoPhillips.

Base Salary

Base salary is a central component of compensation for all of our salaried employees. Management, with the assistance of Mercer, its outside compensation consultant, thoroughly examines the scope and complexity of executive jobs throughout ConocoPhillips and benchmarks the competitive compensation practices for such jobs. As a result of this work, management has developed a compensation structure that assigns all positions to specific salary grades. For our executives, the base salary midpoint increases as the salary grade increases, but at a lesser rate than the overall target incentive compensation percentages increase. The result is a higher percentage of at-risk compensation as an executive’s salary grade rises.

We set base salaries to be competitive within our compensation reference group and, for certain staff positions, Fortune 50-150 Industrials, taking into account responsibilities and duties, individual performance, and time in position. See “Process for Determining Executive Compensation — Setting Target Compensation — Compensation Reference Group” beginning on page 79 for a discussion of our benchmarking exercise.

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Performance-Based Pay Programs

ANNUAL INCENTIVE

All of our employees throughout the world — including our executives — participate in our annual short-term incentive program, called the Variable Cash Incentive Program (“VCIP”). It is our primary vehicle for recognizing company and individual performance for the prior year. We believe that having an annual “at risk” compensation element gives employees a financial stake in the achievement of our business objectives and motivates them to achieve those objectives.

For all employees, the base VCIP award is comprised of corporate performance categories including HSE, Operational, Financial, Strategic Milestones, and Energy Transition Milestones. The HRCC has discretion to adjust base awards up or down depending on individual performance, but the final award, inclusive of any adjustments, may not exceed 200 percent of the target. Beginning with the 2022 program, the HRCC eliminated individual performance adjustments in the short-term incentive program for NEOs.

LONG-TERM INCENTIVES

Our primary long-term incentive compensation programs for executives are the Performance Share Program (“PSP”) and the Executive Restricted Stock Unit Program, which replaced the Stock Option Program effective with equity grants made in 2018. The HRCC approved replacing stock options with three-year, time-vested restricted stock units under the Executive Restricted Stock Unit Program in response to stockholder feedback and to be consistent with market trends. In addition, the HRCC increased the weighting of the long-term incentive award in the form of performance-based restricted stock units under the PSP from 60 percent to 65 percent and assigned a weight of 35 percent to the Executive Restricted Stock Unit Program. Approximately 60 of our current employees participate in these programs.

PERFORMANCE SHARE PROGRAM

The PSP rewards executives based on ConocoPhillips’ performance over a three-year period. Each year, the HRCC establishes performance metrics for a new three-year performance period. Thus, performance results in any given year are considered in three overlapping performance periods. We believe the use of a multi-year performance period helps to focus management on longer-term results. PSP award targets are set in shares at the beginning of the performance period, and actual cash payouts, based on the HRCC’s evaluation of performance, are calculated using our stock value after the conclusion of the three-year performance period. Thus, the value of the performance shares is tied to stock price performance throughout the performance period.

Targets for participants whose salary grades are changed during a performance period are prorated to align incentive levels with the individual’s changing level of responsibility. Changes in salary not accompanied by a change in salary grade do not affect the targets. The targets for the CEO are set annually by the HRCC.

The award is calculated on a formulaic basis using a relative TSR metric and a relative Financial metric, with respective weightings of 60 and 40 percent. At the end of the performance period, the final award may not exceed 200 percent of the total target award (the initial target award set in restricted stock units, at the beginning of the performance period, together with any promotional awards and reinvested dividend equivalents during the performance period). The final award is determined by the HRCC following several detailed reviews of company performance and is based on the HRCC’s evaluation of ConocoPhillips’ formulaic performance relative to the preestablished metrics (discussed under “Process for Determining Executive Compensation — Corporate Performance Criteria” on page 81).

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Compensation Discussion and Analysis

Performance metrics and peers for performance share programs

The performance metrics and peers established by the HRCC for the PSP 21 (2021-2023), PSP 22 (2022-2024), PSP 23 (2023-2025), and PSP 24 (2024-2026) awards granted in 2021, 2022, 2023, and 2024 respectively, have been established as follows:

Metrics       Performance Peers(1)
PSP 21, PSP 22, & PSP 23
Relative Total Shareholder Return (60%)
Relative Adjusted ROCE (40%)
PSP 24
Relative Total Shareholder Return (60%)
Relative & Absolute Adjusted ROCE (40%)
S&P 500 Total Return Index(2)
APA Corporation
Chevron Corporation
Devon Energy Corporation
Diamondback Energy(3)
EOG Resources, Inc.
Exxon Mobil Corporation
Hess Corporation(4)
Marathon Oil Corporation(5)
Occidental Petroleum Corporation
Pioneer Natural Resources(6)
(1) Each peer is a performance peer for PSP 21, PSP 22, PSP 23, and PSP 24, unless otherwise noted.
(2) For relative TSR metric only.
(3) Performance peer for PSP 24 award only. Diamondback Energy was added to the performance peer group to reflect our significant footprint in the Permian Basin and due to the anticipated completion of the acquisition of Pioneer Natural Resources by Exxon Mobil Corporation in 2024.
(4) On October 23, 2023, Chevron Corporation announced a planned acquisition of Hess Corporation. Effective upon the completion of the acquisition only the combined company (Chevron Corporation) will be retained for any ongoing performance programs.
(5) Performance peer for PSP 21 and PSP 22 awards only.
(6) Performance peer for PSP 23 and PSP 24 awards only. Pioneer Natural Resources was added to the performance peer group to better reflect our significant footprint in the Permian Basin. On October 11, 2023, Exxon Mobil announced a planned acquisition of Pioneer Natural Resources. Effective upon the completion of the acquisition only the combined company (Exxon Mobil) will be retained for any ongoing performance programs.

EXECUTIVE RESTRICTED STOCK UNIT PROGRAM
Like the PSP, the Executive Restricted Stock Unit Program is designed to reward our executives for long-term share performance and encourage executive retention while incentivizing absolute performance that is aligned with stockholder interests. The restricted stock units vest three years following the date of grant, which is competitive with industry peers.

The combination of the PSP and the Executive Restricted Stock Unit Program, along with our Stock Ownership Guidelines described under “Executive Compensation Governance — Alignment of Interests — Stock Ownership and Holding Requirements” on page 95, provides a comprehensive package of long-term incentives for our executives that align their interests with stockholders.

STOCK OPTION PROGRAM
In response to stockholder feedback and consistent with market trends, the HRCC discontinued the Stock Option Program effective with equity grants made in 2018 and substituted the Executive Restricted Stock Unit Program. The practice under the Stock Option Program was to set option exercise prices no lower than the fair market value of ConocoPhillips stock at the time of the grant. Because an option’s value is derived solely from an increase in our stock price, options only reward recipients if the value of our stock appreciates. All previously granted and unexercised stock options are vested and exercisable and expire 10 years following the grant date.

OFF-CYCLE AWARDS
ConocoPhillips may make awards outside the PSP or the Executive Restricted Stock Unit Program. Currently, off-cycle awards are generally granted to certain incoming executives for one or more of the following reasons: (1) to induce an executive to join ConocoPhillips (occasionally replacing compensation the executive will lose by leaving the prior employer); (2) to induce an executive of an acquired company to remain with ConocoPhillips for a certain period of time following the acquisition; or (3) to provide a pro rata equity award to an executive who joins ConocoPhillips during an ongoing performance period in which the executive is ineligible to participate under the standard PSP or Executive Restricted Stock Unit Program provisions. In these cases, the HRCC has sometimes approved a shorter period for restrictions on transfers of restricted stock units than those issued under the PSP or Executive Restricted Stock Unit Program. Any off-cycle awards to Senior Officers must be approved by the HRCC.

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Process for Determining Executive Compensation

Our executive compensation programs take into account market-based compensation for executive talent; internal pay equity among our employees; corporate, business unit, and individual results; and the talents, skills, and experience that each individual executive brings to ConocoPhillips. Our NEOs each serve without an employment agreement. All compensation for these officers is set by the HRCC as described below.

ROLES AND RESPONSIBILITIES
HUMAN RESOURCES AND COMPENSATION COMMITTEE (HRCC)
Annually reviews and determines compensation for the CEO and for each of the NEOs.
Makes critical decisions on competitive compensation levels, program design, performance targets and associated peer groups, corporate and individual performance, and appropriate pay adjustments necessary to reflect short-and long-term performance.
Considers annual benchmark data provided by the consultants, dialogues with our largest stockholders, and evaluates four in-depth management reviews of ongoing corporate performance.
The HRCC also has sole authority to retain, terminate, and obtain advice and assistance from a compensation consultant, external legal, accounting, and other advisors and consultants. The HRCC conducts an annual review of the HRCC’s independent consultant and has discretion to replace the independent consultant. The HRCC approves in advance all the work to be done by the independent consultant.
MANAGEMENT
ConocoPhillips’ Human Resources department supports the HRCC in the execution of its responsibilities and manages the development of the materials for each committee meeting, including market data, individual and company performance metrics, and compensation recommendations.
The CEO considers performance and makes individual recommendations on base salary, annual incentive, and long-term equity compensation with respect to Senior Officers, including all NEOs other than himself. These recommendations are reviewed, discussed, modified, and approved, as appropriate, by the HRCC. No member of the management team, including the CEO, has a role in determining his or her own compensation.
COMPENSATION CONSULTANTS
The HRCC retained FW Cook as its independent executive compensation consultant in 2023. Management also retained Mercer to provide other consulting services. The consultants compile compensation data, conduct analyses, supplement internal resources for market analysis, and assist in the evaluation of the compensation of the CEO and Senior Officers.
The HRCC considered whether any conflict of interest exists with either FW Cook or Mercer in light of SEC rules. The HRCC assessed the following factors relating to each consultant in its evaluation:
Other services provided to us by the consultant;
Fees paid by us as a percentage of the consulting firm’s total revenue;
Policies or procedures maintained by the consulting firm that are designed to prevent a conflict of interest;
Any business or personal relationships between the individual consultants involved in the engagement and a member of the HRCC or executive officers; and
Any ConocoPhillips stock owned by the individual consultants involved in the engagement.
Both FW Cook and Mercer provided the HRCC with appropriate assurances addressing such factors. Based on this information, the HRCC concluded the work of the consultants did not raise any conflict of interest. The HRCC also took into consideration all factors relevant to FW Cook’s independence from management, including those specified in Section 303A.05(c) of the NYSE Listed Company Manual, and determined that FW Cook is independent and performs no other services for ConocoPhillips.
ConocoPhillips is prohibited from employing any FW Cook consultant who worked on our account for a period of one year after that individual leaves the employment of the independent consultant.

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HRCC ANNUAL COMPENSATION CYCLE

              
      FEBRUARY
Approval of prior year’s incentive payouts
Set target compensation and performance targets for the current year (see “Setting Increasingly Challenging Targets” on page 80)
   

MARCH – APRIL
Publication of our Annual Proxy Statement detailing performance and compensation information for the prior year
Stockholder outreach; feedback shared with the HRCC/Board
   


 
    MAY
Annual Meeting with annual stockholder say on pay vote
     

 
    JULY
First performance review; feedback is given on current year’s performance
Independent third-party benchmarks CEO pay and reviews market trends to advise HRCC as it considers compensation program design changes for upcoming year
 


   
OCTOBER
Stockholder outreach
Review of market best practices and initial program design concept for upcoming year
Compensation program risk analysis
 



    DECEMBER
Feedback received during stockholder outreach shared with HRCC/Board
Approval of program design for upcoming year
Second performance review; feedback is given on current year’s performance
 



JANUARY – FEBRUARY
Third and fourth performance reviews; feedback is given on prior year’s performance
Independent third-party review of peer target compensation and payouts for prior year performance period
 



 

RISK ASSESSMENT

ConocoPhillips has considered the risks associated with each of its executive broad-based compensation programs and policies. As part of the analysis, we considered the performance measures we use, as well as the different types of compensation, varied performance measurement periods, and extended vesting schedules utilized under each incentive compensation program. As a result of this review, management concluded the risks arising from our compensation policies and practices are not reasonably likely to have a material adverse effect on ConocoPhillips. As part of the Board’s oversight of ConocoPhillips’ risk management programs, the HRCC conducts a similar review with the assistance of its independent compensation consultant. The HRCC agrees with management’s conclusion that the risks arising from our compensation policies and practices are not reasonably likely to have a material adverse effect on ConocoPhillips.

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Setting Target Compensation — Compensation Reference Group

COMPENSATION REFERENCE GROUP AND METHODOLOGY

The HRCC regularly assesses the market competitiveness of our executive compensation programs based on data from a compensation reference group. The compensation reference group is currently made up of 11 energy industry companies and 11 similarly sized general industry companies that are comparable to ConocoPhillips in terms of size, scope, and compensable factors. The HRCC utilizes a broader reference group that includes non-energy industry companies for compensation benchmarking given that ConocoPhillips is uniquely positioned as one of the largest independent E&P companies based on production and reserves. This reference group, inclusive of general industry companies, provides more statistically robust compensation data from companies with similar compensable factors as E&P industry consolidation occurs and is responsive to stockholder feedback. Accordingly, in analyzing the appropriate composition of the reference group that would help inform 2023 target compensation decisions, the HRCC considered the following criteria:

(1) Companies with which we compete for business opportunities and executive talent;
(2) Companies with significant operations and capital investments, medium-and long-term project investment cycles, and complex global operations;
(3) Size, including revenues, assets, and market capitalization; and
(4) Industry focus, particularly companies in the energy industry.

The data is used to assess the competitive market value for executive jobs, assess pay practices, validate targets for pay programs, test the compensation strategy, observe trends, and provide a general competitive foundation for decision-making.

COMPENSATION REFERENCE GROUP

3M Company
APA Corporation*
Bristol-Myers Squibb Company
Caterpillar Inc.
Chevron Corporation*
Cummins Inc.
Devon Energy Corporation*
EOG Resources, Inc.*
Exxon Mobil Corporation*
General Dynamics Corporation
Halliburton Company*
Honeywell International Inc.
Lockheed Martin Corporation
Marathon Petroleum Corporation*
Merck & Co., Inc.
Northrop Grumman Corporation
Occidental Petroleum Corporation*
Pfizer Inc.
Phillips 66*
RTX Corporation
Schlumberger N.V.*
Valero Energy Corporation*
* Energy industry companies

Mercer gathers and performs an analysis of market data for each NEO, comparing each of their individual components of compensation, as well as total compensation, to that of the compensation reference group. This competitive analysis consists of comparing the market data of each of the pay elements and total compensation at the 25th, 50th, and 75th percentiles of the compensation reference group to compensation for each of our NEOs. Target total compensation for each NEO is structured to target market competitive pay levels at approximately the 50th percentile in base salary and short-and long-term incentive opportunities, taking into account roles, responsibilities and duties, experience, individual performance, and time in position. The HRCC's independent consultant, FW Cook, reviews and independently advises on the conclusions reached as a result of this benchmarking.

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CEO 2023 Compensation

In reviewing 2023 target compensation for the CEO, the HRCC considered the median target compensation of the compensation reference group, which was approximately $18 million with a median tenure of approximately five years. Based on this review and considering Mr. Lance’s tenure (11 years), overall performance, the performance of ConocoPhillips, and the relative positioning of target compensation for Mr. Lance as compared to the market median of the compensation reference group, the HRCC increased Mr. Lance’s 2023 base salary by 3% effective March 1, 2023, his 2023 short-term incentive target from 160% to 165% and his 2023 long-term incentive target awards by $0.8 million. The increase to his long-term incentive target had no pension impact.

Internal Pay Equity

We believe our compensation structure provides a framework for an equitable compensation ratio among our executives, with higher targets for jobs involving greater duties and responsibilities. Our compensation program is designed so that the individual target level rises as salary grade level increases, with the portion of performance-based compensation rising as a percentage of total target compensation. The HRCC reviews the compensation of Senior Officers periodically to ensure the equitable compensation of officers with similar levels of responsibilities.

Developing Performance Measures

We believe our performance measures appropriately reflect the performance of ConocoPhillips consistent with our strategy as an independent E&P company. Specifically, the HRCC has approved a balance of metrics, some that measure performance relative to our peer group, some that measure absolute performance, and some that measure progress in executing our strategic and energy transition milestones and objectives. We have selected multiple metrics, as described herein, because we believe no single metric is sufficient to capture the performance we are seeking to drive. Moreover, reliance on any metric in isolation is unlikely to promote the well-rounded executive performance necessary to enable us to achieve long-term success. It is for this reason that metrics are assessed in tandem, rather than each with a separate weighting and threshold. The HRCC reassesses performance metrics periodically to confirm that they remain appropriate.

Setting Increasingly Challenging Targets

Targets for each metric are set in accordance with our rigorous internal budget. The HRCC believes that increasingly challenging performance metrics best assess ConocoPhillips’ performance relative to its strategy as an independent E&P company. Increasingly challenging targets can mean year-over-year performance target increases for safety, efficiency, emissions reduction, unit cost targets, and margins. However, it can also mean the same or lower performance targets, recognizing a changing commodity price environment. For example, delivering flat production targets following significant capital and operating cost reductions or establishing production targets below those set in prior years after significant asset dispositions would be considered “increasingly challenging.” Likewise, setting higher cost or capital targets above those set in prior years after significant acquisitions or periods of rising inflation would be considered “increasingly challenging.”

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Corporate Performance Criteria

Individual NEO payouts are determined based on the payout for corporate performance. We use the compensation metrics described below, as approved by our HRCC, to determine the corporate performance payout. The compensation metrics support our Triple Mandate, are consistent with our strategic cash flow allocation priorities, and, therefore, are aligned with our goal to deliver superior returns to stockholders through price cycles. See “Executive Compensation —Strategic Alignment” beginning on page 72. The HRCC determines the ultimate payout of our programs based on how well ConocoPhillips performs against targets set for each of these metrics. The compensation metrics and how they align with our strategic priorities and desired outcomes are described in more detail below.

VCIP


PSP


HEALTH, SAFETY, AND ENVIRONMENTAL (VCIP ONLY)

Everything we do depends on safely executing our business plans and operating to high standards of HSE stewardship. We view this as our fundamental license to operate. We have a comprehensive HSE program across our entire company, which includes criteria for process and personal safety. We include relative Total Recordable Rate and Process Safety Events in our compensation metrics to reinforce our commitment to be an industry leader in HSE, drive continuous HSE improvement, and provide accountability for HSE at all levels of the organization, including among our senior leaders.

Total Recordable Rate is a measure of the rate of recordable injury cases in a year. Process Safety Events is a measure of the control of process hazards in a facility with the potential to impact people, property, or the environment. This includes the prevention, control, and mitigation of unintentional releases of hazardous material or energy from primary containment. We invest significant resources and provide focused attention to continually improve our safety culture and performance across the entire company.

OPERATIONAL (VCIP ONLY)

As an E&P company, strong operational performance is essential for delivering on our commitments to stockholders. Our Operational metrics include absolute targets for Production, Capital, Operating and Overhead Costs, and Operational Milestones.

Our primary source of revenue and cash flow is the sale of our produced oil and gas. Therefore, we set an annual Production target, and we measure results against the approved target. Importantly, we tie our annual Production target to annual targets for Capital, Operating and Overhead Costs, and Operational Milestones. This is designed to ensure that we do not inadvertently incentivize actions, such as growing at all costs, that are misaligned with our strategic priorities. Effective capital and operating cost management also helps us achieve a low cost of supply portfolio in support of our returns-focused strategy. The Operational Milestones and targets are also designed to create alignment within our workforce around delivering business plans while maintaining discipline.

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FINANCIAL (VCIP AND PSP)

The Financial metrics in our compensation programs strongly align with our returns-focused strategy, are core to delivering our value proposition of superior returns through cycles, and strongly correlate to total shareholder returns (“TSR”) and value creation for stockholders. Adjusted ROCE is an important metric for ensuring ConocoPhillips is efficiently allocating capital and is a strong indicator of long-term share price performance. We include Adjusted ROCE in both our VCIP and PSP to ensure that we maintain financial discipline and balance short-and long-term performance.

Our Financial compensation measure includes Adjusted ROCE relative to peers over a one- and three-year period. Evaluation of our performance relative to peers is designed to provide above or below target payouts based on our performance against our performance peer group. These relative metrics are measured from third quarter to third quarter for the relevant periods because full-year peer data is not publicly available at the time of the HRCC annual performance assessment. Therefore, Adjusted ROCE as used for our Financial compensation metrics will differ from ROCE as calculated for other periodic reporting.

For VCIP and PSP, the impact of non-operational results and special items that are unusual or nonrecurring are removed as well as the impact of cash, consistent with ConocoPhillips’ strategy to maintain cash on the balance sheet to ensure adequate liquidity through down cycles. Adjusted ROCE is calculated as follows:

earnings plus or minus special items
plus
after-tax interest
expense plus minority interest
cash adjusted average capital employed
(total equity plus total debt less cash and
cash equivalents, restricted cash, and
short-term investments)

STRATEGIC MILESTONES (VCIP ONLY)

Delivering on our value proposition requires that we take actions and steward the business in ways that are not exclusively operational or financial in nature. Our Strategic Milestones represent annual actions to progress our long-term objectives that position the company to grow and develop over the coming years and decades and that are aligned to our strategy. These metrics provide a direct link from our stated strategy to metrics in the compensation programs.

ENERGY TRANSITION MILESTONES (VCIP ONLY)

Effective with our 2023 short-term incentive program, we created a separately weighted measure for “Energy Transition Milestones.” These milestones are guided by our Triple Mandate to reliably and responsibly deliver oil and gas production to meet energy transition demand while delivering competitive returns and focusing on achieving our net-zero operational emissions ambition. Creating a separate metric serves to further enhance the link between our climate commitments and our executive compensation programs.

RELATIVE TOTAL SHAREHOLDER RETURN (PSP ONLY)

We believe our Operational and Financial measures and Strategic and Energy Transition Milestones have a strong, positive correlation to TSR in our sector. Thus, as we pursue these measures, we expect to achieve superior returns to stockholders. TSR is the best overall indicator of our long-term success. By integrating compensation metrics with strategic priorities, we believe we are strongly aligned with stockholder interests across time periods and through cycles.

We believe it is important to include TSR in our PSP because it is the most tangible, visible measure of the value we have created for stockholders during the relevant period.

TSR represents the percentage change in stock price from the beginning to the end of a performance period, plus the percentage impact from common stock dividends paid during the performance period assuming dividends are reinvested into the stock. Consistent with market practice, we calculate TSR for compensation purposes based on a 20-trading day simple average prior to the beginning of a period and a 20-trading day simple average prior to the end of the stated period.

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We measure TSR relative to our performance peer group to mitigate the influence of sector-wide factors, such as commodity price volatility, on our stock price.

MEASURING PERFORMANCE — PERFORMANCE PEER GROUP
Our performance peer group is used to evaluate relative business results in both our annual incentive and performance share programs. This includes both relative TSR and relative Adjusted ROCE. The HRCC believes our performance is best measured against both large independent E&P companies with diverse portfolios and some of the largest publicly held integrated oil and gas companies that we compete against in our business operations. In addition, the S&P 500 Total Return Index is included in our performance peer group (for the relative TSR metric only) because the HRCC believes that we should be measured against the companies that we compete with for capital in the broader market. We believe that our performance peer group is representative of the companies that investors use for relative performance comparisons. Additionally, the inclusion of the index as a performance peer further aligns executive pay with long-term stockholder interests as we will be required to outperform both industry peers and a market-based index to receive a maximum payout.

The following tables show the performance peer groups that were established for evaluating relative metrics for the periods indicated.

PERFORMANCE PEER GROUP FOR 2023 VCIP
VCIP performance period running from January 2023 through December 2023

APA Corporation
Chevron Corporation
Devon Energy Corporation
EOG Resources, Inc.
Exxon Mobil Corporation
Hess Corporation
Occidental Petroleum Corporation
Pioneer Natural Resources

PERFORMANCE PEER GROUP FOR PSP 21
PSP performance period running from January 2021 through December 2023

S&P 500 Total Return Index(1)
APA Corporation
Chevron Corporation
Devon Energy Corporation
EOG Resources, Inc.
Exxon Mobil Corporation
Hess Corporation
Marathon Oil Corporation
Occidental Petroleum Corporation
(1) For relative TSR metric only.

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2023 Executive Compensation Analysis and Results

The following is a discussion and analysis of the decisions the HRCC made regarding our NEOs in 2023.

Base Salary

The HRCC reviews base salary annually for each of the NEOs. The salary adjustment program is determined by annual benchmarking. Individual salary increases are the result of individual performance, relative position to market, and changes to salary grade. Base salaries for the CEO and for Messrs. Olds and Macklon and Ms. Rose were increased 3 to 8 percent effective March 1, 2023, based on their performance and competitive positioning relative to their peers in the compensation reference group. Effective March 1, 2023, the HRCC approved a promotion, including a 5 percent base salary increase, for Mr. Bullock reflecting the broad scope of his responsibilities, performance, and competitive positioning relative to peers in the compensation reference group.

The table below shows the annualized base salary for each NEO as of the date shown:

Name       12/31/2022       12/31/2023
R.M. Lance  $ 1,700,000  $ 1,751,000
W.L. Bullock, Jr. 964,776 1,013,016
K.B. Rose 924,000 951,984
N.G. Olds 787,536 850,560
D.E. Macklon 858,528 910,056

Performance-Based Programs

Actual awards earned under our performance-based programs can range from zero to 200 percent of the initial award for our NEOs. In determining performance-based compensation awards for our NEOs for performance periods concluding at the end of 2023, the HRCC began by assessing overall company performance. To that end, the HRCC considered the performance reviews throughout and after the performance period ended to assess the degree of difficulty in achieving absolute performance targets and the extent to which such targets were achieved. The HRCC then used the percentile-based matrix below to formulaically evaluate the results of the Financial metric (relative Adjusted ROCE) in the VCIP and PSP and the relative TSR metric in the PSP.


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Annual Incentive — Variable Cash Incentive Program (VCIP)

All of our employees are eligible for the VCIP. The VCIP payout for our NEOs is calculated using the following formula with the maximum VCIP payout capped at 200 percent of target. The HRCC has the sole authority to determine the corporate performance payout based on its assessment of our performance against our metrics. Beginning with the 2022 VCIP, the HRCC eliminated positive individual performance adjustments for the NEOs, and payouts are solely determined by the corporate performance payout approved by the HRCC.


VCIP CORPORATE PERFORMANCE

We incorporate a balance of metrics into our annual incentive program that align with delivering our value proposition and maintaining competitiveness versus our performance peer group. Our program includes both line-of-sight and strategic metrics, as well as both absolute and relative metrics. We do not believe that a single metric is sufficient for driving the behaviors or performance we seek. Therefore, we carefully consider and select a combination of metrics that best ensures accountability across the organization for both short-and longer-term business success. The HRCC routinely reviews and reassesses the VCIP performance metrics and confirm that they remain appropriate for driving desired performance outcomes.

In December 2022, the HRCC approved the five corporate performance measures by which it would judge corporate performance for the 2023 VCIP payout. The corporate measures and assigned weights were: HSE (20%); Operations (30%); Financial (30%); Strategic Milestones (10%); and Energy Transition Milestones (10%).

The HRCC determines the ultimate payout of our programs based on the extent to which ConocoPhillips achieves the targets established under the five corporate performance measures set forth above. These measures support our Triple Mandate and directly correspond to our strategic cash flow allocation priorities, which support our goal to deliver superior returns to stockholders through price cycles. See “Executive Compensation — Strategic Alignment” on page 72 and “Process for Determining Executive Compensation — Corporate Performance Criteria” beginning on page 81.

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SETTING TARGETS FOR 2023

The HRCC reviews and approves targets for the performance metrics annually. The process begins with our rigorous internal budget, which is set each year across the organization and then approved by our Board. For setting VCIP targets, the outputs from the internal budget are reviewed for alignment with the value proposition, as well as degree of difficulty. The HRCC believes that targets should reflect a reasonable chance of achievability, but also be challenging. Significant effort is invested to ensure that the metrics and targets reflect both a desire for continuous improvement and a realistic assessment of changes in the market environment and our portfolio.

For the relative Financial metric, the HRCC established a matrix to inform payout decisions, see page 84. In the case of HSE, Operations, Strategic Milestones, and Energy Transition Milestones metrics, the HRCC relies on a rigorous and transparent review process with management and exercises its judgment based on its knowledge of the business to assess degree of difficulty and determine the appropriate payout (see “HRCC Review Process” beginning on page 88). The HRCC does not believe either a matrix or a threshold-maximum approach is appropriate for all metrics given the significant volatility of the business in any given year and the influence of non-operated activities over which ConocoPhillips has limited control. Having a threshold-maximum approach could incentivize behaviors that are counter to the best interest of ConocoPhillips and its stockholders. Based on our 2023 outreach, we believe the majority of stockholders were satisfied with the level of disclosure around our process, and we have continued to enhance transparency around our targets and results and have sought to continuously improve our disclosures around payout decisions.

Absolute VCIP targets for 2023 were aligned with the production, capital, and operating and overhead external guidance ConocoPhillips provided externally. See “HRCC Annual Compensation Cycle” on page 78.

The HSE, Operations, Financial, Strategic Milestones, and Energy Transition Milestones targets set by the HRCC are as follows:

HSE

We target top-quartile performance relative to our peers for Total Recordable Rate and absolute continuous improvement for TRR and for Process Safety Events. We target being an industry leader in HSE in an effort to drive continuous HSE improvement and provide accountability for HSE at all levels of the organization, including among our senior leaders.

OPERATIONS

Production

The target was set at 1,790 MBOED, which was aligned with the guidance provided to the marketplace in 2023. The HRCC considered the target to be increasingly challenging. On an adjusted basis, the Production target represented 3 percent organic growth as compared to 2022 pro forma production of 1,730 MBOED. The HRCC also considered the target to be increasingly challenging when balanced with the Operating and Overhead Costs target and Capital target.

Capital

The target was set at $11.2 billion, which was consistent with the operating plan outlined to the marketplace in 2023. The Capital target was an increase of approximately 11 percent from full-year 2022 capital expenditures, due to increased spend on longer-cycle projects, including PALNG, Willow, NFE and NFS, more than offsetting the absence of 2022 acquisition spend.

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Operating and Overhead Costs

The target was set at $8.2 billion, which was consistent with the operating plan outlined to the marketplace in 2023. The Operating and Overhead target was an increase of approximately 6 percent from the full year 2022 operating and overhead expenditures due to volume growth and inflation.

Operational Milestones

In the Lower 48, milestones included delivering on Big 3 unconventional development programs as well as progressing optimization efforts across the basins. In Canada, milestones included transitioning Montney to early development by achieving flowback on Pad 5 and Pad 6, as well as starting up the second phase of the company’s gas processing facility. Additionally in Canada, milestones for Surmont included achieving first steam on Pad 267. In Alaska, milestones included reaching FID on Willow, subject to regulatory and legal resolutions, and advancing Nuna 3T to AFE approval. In Norway, milestones included mechanically completing the first subsea template and facilities on Tommeliten A. In Malaysia, milestones included advancing WL4-00 toward AFF decision and finalizing a strategic path forward. In China, milestones included achieving Bohai Phase 4B first oil and sanctioning Bohai Windfarm AFE, subject to government approval.

The exploration milestones included executing the Bear-1 exploration well in Alaska. Additionally, we included a corporate technology milestone to deliver the first release of nxtgenERP with no loss of business effectiveness or integrity.

FINANCIAL

Our financial performance is measured according to our relative performance of Adjusted ROCE among our peers.

STRATEGIC MILESTONES

Our Strategic milestones included:

Progressing the LNG business through advancing new PALNG, NFE, and NFS projects, securing several regasification and offtake agreements, and building out our LNG organization;
Implementing action plans for priority E&S risks and tracking progress against mitigations; and
Refreshing our DEI strategy globally and identifying how to assess progress on each component of diversity, equity, and inclusion.

The HRCC believes these targets, which aligned with external guidance provided to the marketplace, were appropriate and challenging and consistent with ConocoPhillips’ disciplined, returns-focused strategy.

ENERGY TRANSITION MILESTONES

Our Energy Transition Milestones included:

Demonstrating progress against our Plan for the Net-Zero Energy Transition;
Achieving an annual GHG emissions intensity aligned with our 2030 target trajectory range(1), including any updates to the 2030 target;
Executing our capital and cost budget for approved MACC projects; and
Advancing multiple low carbon opportunities.

(1) In 2023, we increased our target trajectory range from 40-50% to 50-60% gross operated emissions intensity reduction, using a 2016 baseline.

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HRCC REVIEW PROCESS

After meeting to approve the metrics (as discussed above), the HRCC met four more times with management to review progress and performance against the approved metrics to determine award payouts under the VCIP. The first and second reviews occurred during 2023 and were designed to provide the HRCC with information concerning the ongoing performance of ConocoPhillips. The third review with the HRCC in late January 2024 focused on the detailed final results for each performance metric relative to the targets, a degree of difficulty discussion, and an explanation of normalization adjustments when appropriate. The final review in mid-February 2024 focused on a summary of the results for each performance metric and deliberation and determination of the final payout by the HRCC. This process allows the HRCC to consider results, degree of difficulty, and normalization adjustments in one meeting and make informed payout decisions in a separate meeting. Results for Production, Operating and Overhead Costs, and Capital, as applicable, are normalized to account for acquisitions and dispositions (e.g., dispositions of non-strategic assets in the Lower 48), foreign exchange rates, commodity price-related adjustments of actuals to targets and related tax and production-sharing contract impacts, and items beyond the control of management (e.g., production impacts from natural disasters). This allows the HRCC to measure results against targets on a consistent basis and measure management performance so there is no benefit or detriment to executive compensation for these items. The normalization adjustments are reviewed by and discussed with the HRCC. The HRCC retains the discretion to make a positive or negative adjustment to awards based on its determination of appropriate payouts. Beginning with the 2022 VCIP, the HRCC eliminated positive individual adjustments for the NEOs, and payouts are solely determined by the corporate performance payout approved by the HRCC.

2023 RESULTS

HSE (ABSOLUTE AND RELATIVE) – 20% weighting

2023 was a challenging year for HSE. Although we had several successes, there were also opportunities for improvement. We remained in the top quartile among our peers for TRR, and we experienced fewer process safety events as compared to 2022. We also experienced zero spills greater than 100 barrels. Although we remained an industry leader among our peers, we had an increase in serious incidents, including one fatality. This serves as a reminder to keep focusing on surpassing the bar that we continuously raise. The HRCC believes that the resulting 85% payout reflects ConocoPhillips’ overall HSE performance.

OPERATIONS (ABSOLUTE) – 30% weighting

Our operations performance resulted in adjusted Production of 1,813 MBOED, 1 percent above our target of 1,790 MBOED. Production performance was strong across our portfolio, driven by Lower 48 well performance and accelerated timing. Our Capital spending of $11.1 billion, adjusted for approved scope changes, came in 1 percent below our 2023 VCIP target of $11.2 billion. Our Operating and Overhead Costs came in 4 percent above the $8.2 billion target, reaching $8.6 billion, due to higher non-operated workover activity, higher volumes and commodity–driven inflation. We also achieved or exceeded all of our Operational Milestones (see “Operational Milestones” on page 87) with the exception of the nxtgenERP milestone, where we made the decision to delay releases to complete additional testing to address potential impacts to business effectiveness. In considering the results of these interdependent operations metrics collectively, the degree of difficulty, and the company’s strong execution of operating plans, the HRCC determined a slightly above-target payout (125%) was warranted.

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FINANCIAL (RELATIVE) – 30% weighting

Our Adjusted ROCE relative to peers was in the 58th percentile, which was driven by our operational performance and success across our global portfolio. The HRCC followed the matrix on page 84 to determine the payout (122%).

STRATEGIC MILESTONES (ABSOLUTE) – 10% weighting

We far exceeded expectations on all of the Strategic Milestones. We significantly progressed the LNG business through advancing new PALNG, NFE and NFS projects, secured regasification and offtake agreements and staffed key roles. We identified and implemented action plans for risk mitigations. We remained focused on DEI, completing the development of educational DEI materials, and leveraging DEI Perspectives survey data to refresh our DEI strategy. In addition, we identified how to assess progress on each component of diversity, equity, and inclusion. The HRCC determined a maximum payout (200%) was warranted given ConocoPhillips’ exceptional performance in achieving the Strategic Milestones.

ENERGY TRANSITION MILESTONES (ABSOLUTE) – 10% weighting

We successfully demonstrated meaningful progress against our Plan for the Net-Zero Energy Transition, including by increasing our target trajectory range for 2030 from 40-50% to 50-60% of gross operated emissions intensity reduction using a 2016 baseline. We also achieved an annual GHG emissions intensity aligned with our 2030 target trajectory range. In addition, we completed our approved MACC projects within the allotted capital and cost budget. We also advanced multiple low carbon opportunities. The HRCC determined that an above target payout (190%) was appropriate considering our demonstrated commitment to progressing towards our energy transition goals.

These results reflect a strong year for ConocoPhillips. We achieved or exceeded our target for almost every metric and showed our commitment and ability to deliver strong financial and operational performance across our global portfolio. The HRCC believes that the resulting 130% corporate performance payout reflects ConocoPhillips’ overall strong performance in 2023.

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The following table describes the details of what the HRCC considered as the quantitative and qualitative performance measures and summarizes the payout decisions:

Metric
Category
      Category
Weighting
      Metric       VCIP Target       VCIP Results and
Performance Summary
      Payout          Weighted
Payout
HSE
Total Recordable
Rate
(“TRR”)
(relative)
Top-quartile performance and industry leader
Continued focus on safety performance, achieving top-quartile TRR; opportunities for improvement remain
85% 17%
Process Safety
Events
(“PSE”)
Continuous Improvement
Zero spills >100 barrels; fewer process safety events as compared to prior year; increase in serious incidents, including a fatality
Operations(1)
Production 1,790
Exceeded target by 1% with adjusted production 1,813 MBOED; strong performance driven by L48
125% 37%
Capital ($B)
$11.2
Delivered capital scope with $11.1B, within 1% of target