The Executive Leadership Team (ELT) has final responsibility for developing corporate strategy, implementing sustainability efforts, and reporting company performance. We have ELT champions for key issue areas:
- Climate change – chief operating officer (COO)
- Water – senior vice president (SVP), Global Operations
- Human rights – SVP, Legal
- Stakeholder engagement – SVP, Corporate Relations
- Biodiversity – SVP, Global Operations
These executives are briefed regularly on emerging issues and strategic priorities and issue action plans in order to understand their implications and represent them to the ELT on an as-needed basis.
The shareholder resolution process provides investors the opportunity to raise ESG concerns with our leadership. While we take those concerns seriously and respect the right for shareholders to file resolutions, we find it is most productive to engage when an issue is identified and shared early.
Performance and Compensation
Two components of executive compensation include metrics related to sustainability performance: the three-year Performance Share Program (PSP) and the annual Variable Cash Incentive Program (VCIP). We engage with our stakeholders regularly on sustainable development priorities, and this feedback is reviewed with the HRCC when considering executive compensation arrangements.
For the 2017 – 2019 performance period, the PSP, which our senior leaders participate in, included an objective to engage on critical stakeholder issues. This objective was achieved, in part, by active participation in the Climate Leadership Council.
All employee compensation includes an annual cash bonus, VCIP, based upon company, business unit and individual performance. We incorporate metrics for health, safety and environmental performance into this annual incentive compensation program as well as the achievement of milestones aligned with strategic priorities. In 2019, employees were rewarded for safety and SD performance for the lowest Total Recordable Rate for injuries on record, which was leading among our peer companies; establishing an integrated management and governance system for setting and monitoring greenhouse gas (GHG) emission reduction targets; our top-tier SD ratings; and for the company’s inclusion in the Dow Jones Sustainability Index and S&P ESG 500. In 2019, we created specific performance criteria for the 2020 VCIP to measure progress on SD priority risks, including actions taken to achieve the long-term GHG emissions intensity target.