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

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EXXON MOBIL CORPORATION

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Notice of 2019 Annual Meeting and Proxy Statement
				April 11, 2019

Dear Shareholder:

We invite you to attend the annual meeting of shareholders on Wednesday, May 29, 2019, at the Renaissance Dallas Hotel Conference Center, 2222 North Stemmons Freeway, Dallas, Texas 75207. The meeting will begin promptly at 9:30 a.m. Central Time. At the meeting, you will hear a report on our business and vote on the following items:

 

•

Election of directors;

 

•

Ratification of PricewaterhouseCoopers LLP as independent auditors;

 

•

Advisory vote to approve executive compensation as required by law;

 

•

Seven shareholder proposals contained in this proxy statement; and

 

•

Other matters if properly raised.

Only shareholders of record on April 3, 2019, or their proxy holders may vote at the meeting. Attendance at the meeting is limited to shareholders or their proxy holders and ExxonMobil guests. Only shareholders or their valid proxy holders may address the meeting.

This booklet includes the formal notice of the meeting and proxy statement. The proxy statement tells you about the agenda, procedures, and rules of conduct for the meeting. It also describes how the Board operates, gives information about our director candidates, and provides information about the other items of business to be conducted at the meeting.

Financial information is provided separately in the booklet, 2018 Financial Statements and Supplemental Information, enclosed with the proxy materials or made available online to all shareholders.

Your vote is important. Even if you own only a few shares, we want your shares to be represented at the meeting. You can vote your shares by Internet, toll-free telephone call, or proxy card. A Summary of 2019 Proxy Voting Results will be available at exxonmobil.com after the annual shareholders meeting.

To attend the meeting in person, please follow the instructions on page 6. An audio webcast and a report on the meeting will be available on our website at exxonmobil.com.

Sincerely,

 

Neil A. Hansen Secretary				Darren W. Woods Chairman of the Board

TABLE OF CONTENTS

 

		Page
PROXY SUMMARY AND VOTING MAP			1
GENERAL INFORMATION			4
BOARD OF DIRECTORS			7
Corporate Governance			7
Item 1 – Election of Directors			19
Director Compensation			24
Certain Beneficial Owners			26
Director and Executive Officer Stock Ownership			26
Audit Committee Report			27
Item 2 – Ratification of Independent Auditors			28
Compensation Committee Report			30
Item 3 – Advisory Vote to Approve Executive Compensation			30
COMPENSATION DISCUSSION AND ANALYSIS			31
EXECUTIVE COMPENSATION TABLES			49
SHAREHOLDER PROPOSALS			58
Item 4 – Independent Chairman			58
Item 5 – Special Shareholder Meetings			59
Item 6 – Board Matrix			61
Item 7 – Climate Change Board Committee			62
Item 8 – Report on Risks of Gulf Coast Petrochemical Investments			64
Item 9– Report on Political Contributions			66
Item 10 – Report on Lobbying			67
PAY RATIO			69
ADDITIONAL INFORMATION			70
DIRECTIONS TO 2019 ANNUAL MEETING

PROXY SUMMARY AND VOTING MAP

Shareholders are asked to consider the materials included in this proxy statement and to vote on the following:

 

ITEM 1 Election of Directors The Board recommends you vote FOR each of the following candidates.

 

The Board of Directors has nominated the director candidates below. All of our nominees currently serve as ExxonMobil directors. All director nominees have stated that they are willing to serve if elected.

Personal information about each nominee is provided beginning on page 19.

Name, Age

Director    Since

ExxonMobil Board Committees

Other Public Company Boards

AC

CC

BAC

FC

PICC

EC

Susan K. Avery, 69 President Emerita, Woods Hole Oceanographic Institution

2017

✓

✓

None

Angela F. Braly, 57 Former Chairman of the Board, President, and CEO, WellPoint (now Anthem)

2016

✓

C

Brookfield Asset   Management; Lowe’s;   Procter & Gamble

Ursula M. Burns, 60 Chairman of the Board and CEO, VEON

2012

C

✓

✓

Nestlé; VEON

Kenneth C. Frazier, 64 Chairman of the Board, President, and CEO, Merck & Co.

2009

✓

C

✓

Merck

Steven A. Kandarian, 67 Chairman of the Board, President, and CEO, MetLife

2018

✓

✓

MetLife; AECOM

Douglas R. Oberhelman, 66 Former Chairman of the Board and CEO, Caterpillar

2015

✓

✓

Bombardier

Samuel J. Palmisano, 67 Former Chairman of the Board, President, and CEO, IBM

2006

C

✓

✓

American Express

Steven S Reinemund, 71 PD Former Chairman of the Board and CEO, PepsiCo

2007

✓

✓

✓

GS Acquisition Holdings; Marriott; Walmart

William C. Weldon, 70 Former Chairman of the Board and CEO, Johnson & Johnson

2013

✓

✓

CVS Caremark; JPMorgan Chase

Darren W. Woods, 54 C Chairman of the Board and CEO, Exxon Mobil Corporation

2016

C

C

None

 

C		Chairman		AC		Audit Committee		FC		Finance Committee
PD		Presiding Director		CC		Compensation Committee		PICC		Public Issues and Contributions Cmt.
✓		Member		BAC		Board Affairs Committee		EC		Executive Committee

 

2019 Proxy Statement				1

 

2						2019 Proxy Statement

ITEM 2 Ratification of Independent Auditors   The Board recommends you vote FOR this proposal.

 

The Audit Committee has appointed PricewaterhouseCoopers LLP (“PwC”) to audit ExxonMobil’s financial statements for 2019.						Additional information about the Audit Committee’s appointment of PwC and PwC’s fees for 2017 and 2018 can be found beginning on page 27.
You are asked to ratify that appointment.

 

ITEM 3 Advisory Vote to Approve Executive Compensation   The Board recommends you vote FOR this proposal.

 

ExxonMobil asks you to vote on a non-binding resolution to approve the compensation of the Named Executive Officers.						Additional information about ExxonMobil’s compensation program can be found beginning on page 30.

 

ITEMS 4 through 10 Shareholder Proposals   The Board recommends you vote AGAINST each of these proposals.

 

You will have the opportunity to vote on shareholder proposals submitted to ExxonMobil.						The text of these proposals, the proponents’ statements in support, and ExxonMobil’s responses can be found beginning on page 58.

 

2019 Proxy Statement				3

GENERAL INFORMATION

Who May Vote

Shareholders of ExxonMobil, as recorded in our stock register on April 3, 2019, may vote at the meeting.

How to Vote

You may vote in person at the meeting or by proxy. We recommend you vote by proxy even if you plan to attend the meeting. You can always change your vote at the meeting.

Important Notice Regarding the Availability of Proxy Materials for the Shareholders Meeting to be held on May 29, 2019:

 

		The 2019 Proxy Statement, 2018 Summary Annual Report, and 2018 Financial Statements are available at www.edocumentview.com/xom.

Notice and Access

We distribute proxy materials to many shareholders via the Internet under the Securities and Exchange Commission’s (“SEC’s”) “Notice and Access” rules, thereby capturing cost and environmental benefits. On or about April 11, 2019, we mailed a Notice Regarding the Availability of Proxy Materials (“Notice”) that contains information about our 2019 annual shareholders meeting and instructions on how to view all proxy materials on the Internet. Also included are instructions on how to vote and how to request a paper or e-mail copy of the proxy materials.

Electronic Delivery of Proxy Statement and Annual Report Documents

For shareholders receiving proxy materials by mail, you can elect to receive an e-mail in the future that will provide electronic links to these documents. Opting to receive your proxy materials online will save the Company the cost of producing and mailing documents to your home or business, and will also give you an electronic link to the proxy voting site.

 

•

Shareholders of Record: If you vote on the Internet at www.investorvote.com/exxonmobil, simply follow the prompts for enrolling in the electronic proxy delivery service. You may enroll in the electronic proxy delivery service at any time in the future by going directly to www.computershare.com/exxonmobil. You may also revoke an electronic delivery election at this site at any time.

 

•

Beneficial Shareholders: If you hold your shares in a brokerage account, you may also have the opportunity to receive copies of the proxy materials electronically. Please check the information provided in the proxy materials mailed to you by your bank or broker regarding the availability of this service.

How Proxies Work

ExxonMobil’s Board of Directors is asking for your proxy. Giving us your proxy means you authorize us to vote your shares at the meeting in the manner you direct.

 

4						2019 Proxy Statement

If your shares are held in your name, you can vote by proxy in one of three convenient ways:

 

Via Internet		By telephone		In writing
Follow the instructions at www.investorvote.com/exxonmobil. You will need to have your proxy card or Notice in hand. At this website, you can elect to access future proxy statements and annual reports via the Internet.		Call toll-free 1-800-652-8683 or 1-781-575-2300 (outside the United States, Canada, and Puerto Rico), and follow the instructions. You will need to have your proxy card or Notice in hand.		Complete, sign, date, and return your proxy card in the enclosed envelope. If you receive a Notice and would like to vote in writing, please follow the instructions in the Notice to obtain paper proxy materials.

Your proxy card covers all shares registered in your name and shares held in your Computershare Investment Plan account. If you own shares in the ExxonMobil Savings Plan for employees and retirees, your proxy card also covers those shares.

If you give us your signed proxy but do not specify how to vote, we will vote your shares as follows:

 

•

For the election of our director candidates;

 

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For ratification of the appointment of independent auditors;

 

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For approval of the compensation of the Named Executive Officers; and

 

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As recommended by the Board with respect to shareholder proposals.

If you hold shares through someone else, such as a stockbroker, you will receive materials from that firm asking how you want to vote. Check the voting form used by that firm to see if it offers Internet or telephone voting.

Voting Shares in the ExxonMobil Savings Plan

The Trustee of the ExxonMobil Savings Plan will vote Plan shares as participants direct. To the extent participants do not give instructions, the Trustee will vote shares as it thinks best. The proxy card serves to give voting instructions to the Trustee.

Revoking a Proxy

You may revoke your proxy before it is voted at the meeting by:

 

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Submitting a new proxy with a later date via a proxy card, the Internet, or by telephone;

 

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Notifying ExxonMobil’s Secretary in writing before the meeting; or

 

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Voting in person at the meeting.

Confidential Voting

Independent inspectors count the votes. Your individual vote is kept confidential from us unless special circumstances exist. For example, a copy of your proxy card will be sent to us if you write comments on the card.

Quorum

In order to carry on the business of the meeting, we must have a quorum. This means at least a majority of the outstanding shares eligible to vote must be represented at the meeting, either by proxy or in person. Treasury shares, which are shares owned by ExxonMobil itself, are not voted and do not count for this purpose.

 

2019 Proxy Statement				5

Votes Required

 

•

Election of Directors Proposal: Under ExxonMobil’s bylaws, a director nominee must receive a majority of votes cast in order to be elected to the Board of Directors in a non-contested election. In a contested election (in which the number of nominees exceeds the number of directors to be elected), the plurality vote standard under New Jersey law would apply. Under plurality voting, the director nominee with the most votes for a particular seat is elected for that seat. Abstentions and broker non-votes are not counted for purposes of the election of directors. A broker non-vote occurs when a bank, broker, or other holder of record that is holding shares for a beneficial owner does not vote on a particular proposal because the record holder does not have discretionary voting power and has not received instructions from the beneficial owner. If you own shares through a broker, you must give the broker instructions to vote your shares in the election of directors. Otherwise, your shares will not be voted.

Our Corporate Governance Guidelines, which can be found in the Corporate Governance section of our website at exxonmobil.com/governance, state that all directors will stand for election at the annual meeting of shareholders. In any non-contested election of directors, any director nominee who receives a greater number of votes AGAINST his or her election than votes FOR such election shall tender his or her resignation. Within 90 days after certification of the election results, the Board of Directors will decide, through a process managed by the Board Affairs Committee and excluding the nominee in question, whether to accept the resignation. Absent a compelling reason for the director to remain on the Board, the Board shall accept the resignation. The Board will promptly disclose its decision and, if applicable, the reasons for rejecting the tendered resignation on Form 8-K filed with the Securities and Exchange Commission.

 

•

Other Proposals: Approval of the ratification of the appointment of independent auditors, the advisory vote to approve executive compensation, and the shareholder proposals require the favorable vote of a majority of votes cast. Only votes FOR or AGAINST these proposals count.

Abstentions count for quorum purposes, but not for voting. Broker non-votes count as votes FOR the ratification of the appointment of independent auditors but do not count for voting on any of the other proposals.

Annual Meeting Admission

Only shareholders or their proxy holders and ExxonMobil guests may attend the meeting.

For safety and security reasons, cameras, smartphones, recording equipment, electronic devices, computers, large bags, briefcases, packages, and firearms or other weapons will not be permitted in the building. In addition, each shareholder and ExxonMobil guest will be asked to present valid government-issued picture identification, such as a driver’s license, before being admitted to the meeting.

For registered shareholders, an admission ticket is the upper part of your proxy card or the full Notice. Please bring the admission ticket with you to the meeting.

If your shares are held in the name of your broker, bank, or other nominee, you must bring to the meeting an account statement or letter from the nominee indicating that you beneficially owned the shares on April 3, 2019, the record date for voting. You may receive an admission ticket in advance by sending a written request with proof of ownership to the address listed below under Contact Information.

Shareholders who do not present admission tickets at the meeting will be admitted only upon verification of ownership at the admission counter.

 

  Audio Webcast of the Annual Meeting

You are invited to visit our website at exxonmobil.com to hear the audio webcast at 9:30 a.m. Central Time, on Wednesday, May 29, 2019. An archived copy of this webcast will be available for one year.

 

6						2019 Proxy Statement

Conduct of the Meeting

The Chairman has broad responsibility and legal authority to conduct the annual meeting in an orderly and timely manner. This authority includes establishing rules for shareholders who wish to address the meeting. Only shareholders or their valid proxy holders may address the meeting. Copies of these rules will be available at the meeting. The Chairman may also exercise broad discretion in recognizing shareholders who wish to speak and in determining the extent of discussion on each item of business. In light of the number of business items on this year’s agenda and the need to conclude the meeting within a reasonable period of time, we cannot ensure that every shareholder who wishes to speak on an item of business will be able to do so.

Dialogue can usually be better accomplished with interested parties outside the meeting and, for this purpose, we have provided a method on our website at exxonmobil.com/directors for raising issues and contacting the non-employee directors either in writing or electronically. The Chairman may also rely on applicable law regarding disruptions or disorderly conduct to ensure that the meeting is conducted in a manner that is fair to all shareholders. Shareholders making comments during the meeting must do so in English so that the majority of shareholders present can understand what is being said.

 

Contact Information   If you have questions or need more information about the annual meeting, write to Mr. Neil A. Hansen, Secretary, Exxon Mobil Corporation, 5959 Las Colinas Boulevard, Irving, TX 75039-2298. Alternatively, call us at 1-972-940-6715 or send a fax to 1-972-940-6748.   For information about shares registered in your name or your Computershare Investment Plan account, call ExxonMobil Shareholder Services at 1-800-252-1800 or 1-781-575-2058 (outside the United States, Canada, and Puerto Rico), or access your account via the website at www.computershare.com/exxonmobil. We also invite you to visit ExxonMobil’s website, where investor information can be found at exxonmobil.com/investor. Website materials are not part of this proxy solicitation.

BOARD OF DIRECTORS

Corporate Governance

Overview

The Board of Directors and its committees perform a number of functions for ExxonMobil and its shareholders, including:

 

•

Overseeing the management of the Company on your behalf, including oversight of risk management;

 

•

Reviewing ExxonMobil’s long-term strategic plans;

 

•

Exercising direct decision-making authority in key areas, such as declaring dividends;

 

•

Selecting the Chief Executive Officer (“CEO”) and evaluating the CEO’s performance; and

 

•

Reviewing development and succession plans for ExxonMobil’s top executives.

The Board has adopted Corporate Governance Guidelines that govern the structure and functioning of the Board and set out the Board’s position on a number of governance issues. A copy of our current Corporate Governance Guidelines is posted on our website at exxonmobil.com/guidelines.

At least annually, the Board and each of the Board committees conduct an evaluation of its performance and effectiveness. Any potential changes to the committees’ charters are also considered at least once a year.

 

2019 Proxy Statement				7

Risk Oversight

Risk oversight is the responsibility of the full Board of Directors. The Board throughout the year participates in reviews with management on the Company’s business, including identified risk factors. As a whole, the Board reviews litigation and other legal matters; political contributions, budget, and policy; lobbying costs; developments in climate science and policy; the Energy Outlook, which projects world energy supply and demand to 2040; stewardship of business performance; and long-term strategic plans.

The Board and/or the Public Issues and Contributions Committee visit an ExxonMobil operations site each year. These visits allow the directors to better understand local issues and to discuss issues such as safety, environmental performance, technology, products, industry and corporate standards, and community involvement associated with the Company’s business.

In addition, existing committees help the Board carry out its responsibility for risk oversight by focusing on specific key areas of risk:

 

•    The Audit Committee oversees risks associated with financial and accounting matters, including compliance with legal and regulatory requirements, and the Company’s financial reporting and internal control systems. The Committee also periodically reviews cybersecurity risks and preparedness and ExxonMobil’s overall risk management approach and structure.   •   The Board Affairs Committee oversees risks associated with corporate governance, including Board structure and succession planning.   •   The Compensation Committee helps ensure that the Company’s compensation policies and practices encourage long-term focus, support the retention and development of executive talent, and discourage excessive risk taking.   •   The Public Issues and Contributions Committee oversees operational risks such as those relating to employee and community safety, health, environmental performance, including actions taken to address climate-related risks, and security matters.
•   The Finance Committee oversees risks associated with financial instruments, financial policies and strategies, and capital structure.

 

The Board receives regular updates from the committees, and believes this structure is best for overseeing risk.

Board Leadership Structure

The Board believes that the decision as to who should serve as Chairman and/or CEO is the proper responsibility of the Board. The Board retains authority to amend the bylaws to separate the positions of Chairman and CEO at any time and will carefully consider the pros and cons of such separation or combination. At the present time, the Board believes the interests of all shareholders are best served through a leadership model with a combined Chairman/CEO position and an independent Presiding Director.

The current CEO possesses an in-depth knowledge of the Company; its integrated, multinational operations; the evolving energy industry supply and demand fundamentals; and the array of challenges to be faced. This knowledge was gained through more than 26 years of successful experience in progressively more senior positions, including domestic and international responsibilities.

The Board believes that these experiences and other insights put the CEO in the best position to provide broad leadership for the Board as it considers strategy and as it exercises its fiduciary responsibilities to shareholders. Further, the Board has demonstrated its commitment and ability to provide independent oversight of management.

 

8						2019 Proxy Statement

The Board is comprised entirely of independent directors except for the CEO, and 100 percent of the Audit, Compensation, Board Affairs, and Public Issues and Contributions Committee members are independent. Each independent director has access to the CEO and other Company executives on request, may call meetings of the independent directors, and may request agenda topics to be added or dealt with in more detail at meetings of the full Board or an appropriate Board committee.

In addition, after considering evolving governance practices and shareholder input regarding Board independence, the Board established the role of Presiding Director. The Board believes the Presiding Director provides effective independent Board leadership. Steven S Reinemund serves as Presiding Director and is expected to remain in the position at least through the annual meeting of shareholders. In accordance with the specific duties prescribed in the Corporate Governance Guidelines, the Presiding Director chairs and approves the agenda for executive sessions of the independent directors, which are held several times per year, normally coincident with meetings of the Board and without the CEO or other management present; chairs meetings of the Board in the absence of the Chairman; and works closely with the Chairman in developing Board agendas, topics, schedules, and in reviewing materials provided to the directors.

Director Qualifications

The Board has adopted guidelines outlining the qualifications sought when considering non-employee director candidates. These Guidelines for the Selection of Non-Employee Directors (“Selection Guidelines”), which are published on our website at exxonmobil.com/directorguidelines, are reviewed annually and state in part:

“ExxonMobil recognizes the strength and effectiveness of the Board reflects the balance, experience, and diversity of the individual directors; their commitment; and importantly, the ability of directors to work effectively as a group in carrying out their responsibilities. ExxonMobil seeks candidates with diverse backgrounds who possess knowledge and skills in areas of importance to the Corporation.”

The qualifications we consider for director candidates include:

 

•

Individuals who have achieved prominence in their fields;

 

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Diversity of experiences and backgrounds, including gender and race/ethnic diversity;

 

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Experience and demonstrated expertise in managing large, relatively complex organizations, such as that of CEOs or next-level executives of a significant company or organization with global responsibilities;

 

•

Financial and other risk management expertise;

 

•

Experience on one or more boards of significant public or non-profit organizations;

 

•

Expertise resulting from significant academic, scientific, or research activities; and

 

•

Experience with cyclical businesses, such as commodities.

Other considerations include:

 

•

A substantial majority of the Board must meet independence standards as described in the Corporate Governance Guidelines;

 

•

All candidates must be free from any relationship with management or the Corporation that would interfere with the exercise of independent judgment;

 

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Candidates should be committed to representing the interests of all shareholders and not any particular constituency; and

 

•

The Board must include members who satisfy legal and stock exchange requirements for certain Board committees.

 

2019 Proxy Statement				9

The Board is comprised of directors with an effective mix of backgrounds, knowledge, and skills that the Board considers helpful in fulfilling its oversight role. The chart below provides a summary of the collective competencies of the Board nominees and explains why these are important:

 

Director Qualifications		Competencies and Relevance to ExxonMobil						Board Composition
Individuals who have achieved prominence in their fields		Current CEO / Former CEO / Field Prominence Experience serving as a CEO or other prominent leader provides unique perspectives to help the Board independently oversee ExxonMobil’s CEO and management. Having this experience also increases the Board’s understanding and appreciation of the many facets of modern international organizations, including strategic planning, financial reporting and compliance, and risk oversight.
Experience and demonstrated expertise in managing large, relatively complex organizations, such as CEOs or next- level executives of a significant company or organization with global responsibilities		Large / Complex Organizations ExxonMobil is among the largest corporate groups in the world. Experience leading a large organization provides practical insights on the challenges and opportunities that such complex businesses face.
		Global Business Leadership ExxonMobil conducts business around the world. Having a global business perspective aids the Board in understanding diverse business environments, economic conditions, and cultures associated with our global workforce and activities.
		Operational Experience Our Company operates in many different places and under varied conditions. Having experience with operational matters and requirements assists the Board in understanding the issues that may face ExxonMobil in its worldwide activities, including maintenance needs, labor relations, and regulatory requirements.
Financial or other risk management expertise		Financial Experience ExxonMobil’s business involves complex financial management, capital allocation, and reporting issues. An understanding of finance and financial reporting is valuable in order to promote effective capital allocation, robust controls, and oversight.
		Risk Management The scale, scope, and complexity of ExxonMobil’s business raises a multitude of interdependent risks, which can vary over time. Experience in effectively identifying, prioritizing, and managing a broad spectrum of risks can help the Board appreciate, anticipate, and assist the Company in managing the risks that face its varied businesses.
Experience on one or more boards of significant public or non-profit organizations		Public Company Board An understanding of public company reporting responsibilities and the issues commonly faced by public companies is important to navigating governance issues faced by ExxonMobil.
Expertise resulting from significant academic, scientific, or research activities		Scientific / Technical / Research Experience ExxonMobil is a leader in research and technology, from finding and producing oil and gas, to developing new products, mitigating emissions, and protecting the environment. It is helpful for Board members to have these competencies, as science and technology are cornerstones to our businesses.
Experience with cyclical businesses, such as commodities		Commodity / Cyclical Business Experience Understanding the unique challenges of a cyclical or commodity business like ours provides helpful insights for assessing Company strategies, challenges, and opportunities.

 

10						2019 Proxy Statement

Diversity of experiences and backgrounds, including gender and race/ethnicity, is also an important consideration for ExxonMobil Board members. The charts below reflect the gender, race/ethnicity, and age diversity of the Board.

 

Strong Board Gender and Race/Ethnic Diversity

 

Director Independence   Our Corporate Governance Guidelines require that a substantial majority of the Board consists of independent directors. In general, the Guidelines require that an independent director must have no material relationship with ExxonMobil, directly or indirectly, except as a director. The Board determines independence on the basis of the standards specified by the New York Stock Exchange (“NYSE”), the additional standards referenced in our Corporate Governance Guidelines, and other facts and circumstances the Board considers relevant.

Under ExxonMobil’s Corporate Governance Guidelines, a director will not be independent if a reportable “related person transaction” exists with respect to that director or a member of the director’s family for the current or most recently completed fiscal year. See the Guidelines for Review of Related Person Transactions posted on the Corporate Governance section of our website and described in more detail under Related Person Transactions and Procedures on pages 13 and 14.

The Board has reviewed relevant relationships between ExxonMobil and each non-employee director and director nominee to determine compliance with the NYSE standards and ExxonMobil’s additional standards. The Board has also evaluated whether there are any other facts or circumstances that might impair a director’s independence. Based on that review, the Board has determined that all ExxonMobil non-employee directors and nominees are independent. The Board has also determined that each member of the Audit, Board Affairs, Compensation, and Public Issues and Contributions Committees (see membership table on page 15) is independent based on both applicable NYSE standards and the Company’s independence standards for each of these committees. The Company’s standards for each committee are included in their respective charters and are posted on our website at exxonmobil.com/guidelines. Website materials are not part of this proxy statement or the accompanying solicitation.

In recommending that each director and nominee be found independent, the Board Affairs Committee reviewed the following transactions, relationships, or arrangements. All matters described below fall within the NYSE and ExxonMobil independence standards.

 

Name		Matters Considered
U.M. Burns		Ordinary course business with VEON (purchases of telecommunication services)
K.C. Frazier		Ordinary course business with Merck (purchases of pharmaceuticals; sales of chemicals and oils)
S.A. Kandarian		Ordinary course business with MetLife (purchases of employee life insurance and other benefits)

 

2019 Proxy Statement				11

Board Succession

As noted in the committee information that follows, the Board Affairs Committee is responsible for identifying director candidates. The Committee seeks new candidates in several ways:

 

•

Recommendations made by the non-employee directors. These recommendations are developed based on the directors’ own knowledge and experience in a variety of fields and on the research conducted by ExxonMobil staff at the Committee’s direction.

 

•

Engagement of an executive search firm. The firm brings forward potential director candidates for the Committee to consider and helps research candidates identified by the Committee.

 

•

Recommendations made by employee directors, shareholders, and others.

All recommendations, regardless of the source, are evaluated on the same basis against the criteria contained in the Selection Guidelines. The Committee has also instructed its executive search firm to include diversity as part of the candidate search criteria.

Shareholders may send recommendations for director candidates to the Secretary at the address given under Contact Information on page 7. A submission recommending a candidate should include:

 

•

Sufficient biographical information to allow the Committee to evaluate the candidate in light of the Selection Guidelines;

 

•

Information concerning any relationship between the candidate and the shareholder recommending the candidate; and

 

•

Material indicating the willingness of the candidate to serve if nominated and elected.

The procedures by which shareholders may recommend nominees have not changed materially since last year’s proxy statement.

The Company seeks to have a diverse Board representing a range of backgrounds, knowledge, and skills relevant to the Company’s business and the needs of the Board, and as part of the search process, considers highly qualified candidates, including women and minorities. The Committee does not use quotas but considers diversity along with the other requirements of the Selection Guidelines when evaluating potential new directors.

Board Tenure

The Board does not impose tenure limits on its directors, other than a mandatory retirement age of 72 and the requirement to stand for election annually. Given the complexity and breadth of our business and its long investment horizons, the Board considers longevity of service and experience of great value. The Board also believes that its director compensation approach, which limits the vesting of restricted shares until retirement, closely aligns directors with the interests of long-term shareholders. The Board seeks to achieve a balance of diversity and experience in the composition of the Board.

All ExxonMobil directors stand for election at the annual meeting. Non-employee directors cannot stand for election after they have reached age 72, unless the Board makes an exception on a case-by-case basis. Employee directors resign from the Board when they are no longer employed by ExxonMobil.

As of April 1, 2019, the average tenure of non-employee directors standing for election is 6.5 years, well below the average of S&P 500 companies of 8.1 years (per 2018 Spencer Stuart Board Index).

Non-Employee Director Tenure

 

22%		45%		11%		22%
< 3 years		3-6 years		7-10 years		11+ years

 

12						2019 Proxy Statement

Related Person Transactions and Procedures

In accordance with SEC rules, ExxonMobil maintains Guidelines for Review of Related Person Transactions (“Related Person Transaction Guidelines”). These guidelines are available on the Corporate Governance section of our website.

In accordance with the Related Person Transaction Guidelines, all executive officers, directors, and director nominees are required to identify, to the best of their knowledge after reasonable inquiry, business and financial affiliations involving themselves or their immediate family members that could reasonably be expected to give rise to a reportable related person transaction. Covered persons must also advise the Secretary of the Corporation promptly of any change in the information provided, and will be asked periodically to review and reaffirm their information.

For the above purposes, “immediate family member” includes a person’s spouse, parents, siblings, children, in-laws, and step-relatives.

Based on this information, the Company’s own records are reviewed and follow-up inquiries are made as may be necessary to identify potentially reportable transactions. A report summarizing such transactions and including a reasonable level of detail is then provided to the Board Affairs Committee. The Committee oversees the Related Person Transaction Guidelines generally and reviews specific items to assess materiality.

In assessing materiality for this purpose, information will be considered material if, in light of all circumstances, there is a substantial likelihood that a reasonable investor would consider the information important in deciding whether to buy or sell ExxonMobil stock or in deciding how to vote shares of ExxonMobil stock. A director will abstain from the decision on any transactions involving that director or his or her immediate family members.

Under SEC rules, certain transactions are deemed not to involve a material interest (including transactions in which the amount involved in any 12-month period is less than $120,000 and transactions with entities where a related person’s interest is limited to service as a non-employee director). In addition, based on a consideration of ExxonMobil’s facts and circumstances, the Committee will presume that the following transactions do not involve a material interest for purposes of reporting under SEC rules:

 

•

Transactions in the ordinary course of business with an entity for which a related person serves as an executive officer, provided: (1) the affected director or executive officer did not participate in the decision on the part of ExxonMobil to enter into such transactions; and (2) the amount involved in any related category of transactions in a 12-month period is less than 1 percent of the entity’s gross revenues;

 

•

Grants or membership payments in the ordinary course of business to nonprofit organizations, provided: (1) the affected director or executive officer did not participate in the decision on the part of ExxonMobil to make such payments; and (2) the amount of general purpose grants in a 12-month period is less than 1 percent of the recipient’s gross revenues;

 

•

Payments under ExxonMobil plans and arrangements that are available generally to U.S. salaried employees (including contributions under the ExxonMobil Foundation’s Educational and Cultural Matching Gift Programs and payments to providers under ExxonMobil health care plans); and

 

•

Employment by ExxonMobil of a family member of an executive officer, provided the executive officer does not participate in decisions regarding the hiring, performance evaluation, or compensation of the family member.

Transactions or relationships not covered by the above standards will be assessed by the Board Affairs Committee on the basis of the specific facts and circumstances.

Unless otherwise noted, the following disclosures are made as of February 26, 2019 which is the date of the most recent Board Affairs Committee review of potential related person transactions.

ExxonMobil and its affiliates have more than 70,000 employees around the world and employees related by birth or marriage may be found at all levels of the organization. ExxonMobil employees do not receive preferential treatment by reason of being related to an executive officer, and executive officers do not participate in hiring, performance

 

2019 Proxy Statement				13

evaluation, or compensation decisions for family members. ExxonMobil’s employment guidelines state, “Relatives of Company employees may be employed on a non-preferential basis. However, an employee should not be employed by or assigned to work under the direct supervision of a relative, or to report to a supervisor who in turn reports to a relative of the employee.”

Several current ExxonMobil executive officers and retirees who served as executive officers in 2018 have family members who are employed by the Corporation or its affiliates and whose current annualized compensation (including benefits) exceeds the SEC disclosure threshold: N.A. Hansen (Vice President – Investor Relations and Secretary) has a brother-in-law employed by ExxonMobil Development Company; L.M. Mallon (President – ExxonMobil Development Company) has a son employed by ExxonMobil Development Company; R.N. Schleckser (Vice President and Treasurer) has a brother employed by ExxonMobil Research and Engineering Company; J.M. Spellings, Jr. (Vice President and General Tax Counsel) has a son employed by ExxonMobil Pipeline Company; T.J. Wojnar, Jr. (Vice President – Corporate Strategic Planning) has a son-in-law employed by ExxonMobil Fuels & Lubricants Company; and J.J. Woodbury (retired former Vice President – Investor Relations and Secretary) has a son employed by XTO Energy Inc. Consistent with ExxonMobil’s Related Person Transaction Guidelines as described above, these relationships are not considered to be material within the meaning of the related person transaction disclosure rules.

S.N. Ortwein (retired former President, XTO Energy Inc) has a brother-in-law currently serving as Chief Executive Officer of Oracle Corporation. In the ordinary course of our business, ExxonMobil purchases a variety of computer technology and services from Oracle. Ms. Ortwein had no involvement in decisions regarding ExxonMobil’s business with Oracle and the annual volume of such business is well below the categorical threshold established in ExxonMobil’s Related Person Transaction Guidelines. R.M. Ebner (Vice President and General Counsel) has a brother-in-law who is a partner of a law firm that performs limited work for ExxonMobil. Mr. Ebner’s brother-in-law does not work on ExxonMobil’s account and Mr. Ebner is recused from any involvement in decisions to retain the firm. Therefore, these relationships are not considered to be material within the meaning of the related person transaction disclosure rules.

The Board Affairs Committee also reviewed ExxonMobil’s ordinary course business with companies for which non-employee directors or their immediate family members serve as executive officers. The Committee determined that, in accordance with the categorical standards described above, none of those matters represent reportable related person transactions. See Director Independence on page 11.

The Committee also determined that no related person transactions occurred during the year involving any of the investors who have reported ownership of more than 5 percent of ExxonMobil’s outstanding common stock. See Certain Beneficial Owners on page 26.

ExxonMobil is not aware of any related person transactions required to be reported under applicable SEC rules since the beginning of the last fiscal year where our policies and procedures did not require review, or where such policies and procedures were not followed.

The Corporation’s Related Person Transaction Guidelines are intended to assist the Corporation in complying with its disclosure obligations under SEC rules. These procedures are in addition to, not in lieu of, the Corporation’s Code of Ethics and Business Conduct.

Code of Ethics and Business Conduct

The Board maintains policies and procedures (referred to in this proxy statement as the “Code”) that represent both the code of ethics for the principal executive officer, principal financial officer, and principal accounting officer under SEC rules, and the code of business conduct and ethics for directors, officers, and employees under NYSE listing standards. The Code applies to all directors, officers, and employees. The Code includes a Conflicts of Interest Policy under which directors, officers, and employees are expected to avoid any actual or apparent conflict between their own personal interests and the interests of the Corporation.

The Code is posted on the ExxonMobil website at exxonmobil.com/code. The Code is also included as an exhibit to our Annual Report on Form 10-K. Any amendment of the Code will be posted promptly on ExxonMobil’s website.

 

14						2019 Proxy Statement

The Corporation maintains procedures for administering and reviewing potential issues under the Code, including procedures that allow employees to make complaints without identifying themselves. The Corporation also conducts periodic mandatory business practice training sessions, and requires regular employees and non-employee directors to complete annual compliance certifications.

The Board Affairs Committee will initially review any suspected violation of the Code involving an executive officer or director and will report its findings to the Board. The Board does not envision that any waiver of the Code will be granted. Should such a waiver occur, it will be promptly disclosed on ExxonMobil’s website.

Board Meetings and Annual Meeting Attendance

The Board met nine times in 2018. ExxonMobil’s incumbent directors, on average, attended approximately 99 percent of Board and committee meetings during 2018. No director attended less than 75 percent of such meetings. ExxonMobil’s non-employee directors held seven executive sessions in 2018.

As specified in our Corporate Governance Guidelines, it is ExxonMobil’s policy that directors should make every effort to attend the annual meeting of shareholders. All incumbent directors attended last year’s meeting.

Board Committees

The Board appoints committees to help carry out its duties. Board committees work on key issues in greater detail than would be possible at full Board meetings. Only non-employee directors may serve on the Audit, Compensation, Board Affairs, and Public Issues and Contributions Committees. Each committee has a written charter. The charters are posted on the Corporate Governance section of our website at exxonmobil.com/governance.

The table below shows the current membership of each Board committee and the number of meetings each committee held in 2018.

 

Director

Audit

Compensation

Board   Affairs

Finance

Public Issues   and Contributions

Executive(1)

S.K. Avery

✓

✓

A.F. Braly

✓

C

U.M. Burns

C

✓

✓

K.C. Frazier

✓

C

✓

S.A. Kandarian

✓

✓

D.R. Oberhelman

✓

✓

S.J. Palmisano

C

✓

✓

S.S Reinemund

✓

✓

✓

W.C. Weldon

✓

✓

D.W. Woods

C

C

2018 Meetings

11

6

6

2

4

0

C = Chair    ✓ = Member            (1) Other directors serve as alternate members on a rotational basis

Below is additional information about each Board committee.

Board Affairs Committee

The Board Affairs Committee serves as ExxonMobil’s nominating and corporate governance committee. Its responsibilities include:

 

•

Recommendation of director candidates;

 

•

Review of non-employee director compensation;

 

•

Review of other corporate governance practices, including the Corporate Governance Guidelines;

 

2019 Proxy Statement				15

•

Review of any issue involving an executive officer or director under ExxonMobil’s Code of Ethics and Business Conduct; and

 

•

Administration of ExxonMobil’s Related Person Transaction Guidelines.

The Committee also administers provisions of the Corporate Governance Guidelines that require a director to tender a resignation when there is a substantial change in the director’s circumstances. The Committee reviews the relevant facts to determine whether the director’s continued service would be appropriate and makes a recommendation to the Board.

Another responsibility of the Committee is to review and make recommendations to the Board regarding the compensation of the non-employee directors. The Committee uses an independent consultant, Pearl Meyer & Partners, LLC (“Pearl Meyer”), to provide information on current developments and practices in director compensation. Pearl Meyer is the same consultant retained by the Compensation Committee to advise on executive compensation, but performs no other work for ExxonMobil.

The Guidelines for the Selection of Non-Employee Directors describe the qualifications the Committee looks for in director candidates. These Selection Guidelines, as well as the Committee’s charter, are posted on the Corporate Governance section of our website.

Audit Committee

The Audit Committee oversees accounting and internal control matters. Its responsibilities include oversight of:

 

•

Management’s conduct of the Corporation’s financial reporting process;

 

•

The integrity of the financial statements and other financial information provided by the Corporation to the SEC and the public;

 

•

The Corporation’s system of internal accounting and financial controls;

 

•

The Corporation’s compliance with legal and regulatory requirements;

 

•

The performance of the Corporation’s internal audit function;

 

•

The independent auditors’ qualifications, performance, and independence; and

 

•

The annual independent audit of the Corporation’s financial statements.

The Committee has direct authority and responsibility to appoint (subject to shareholder ratification), compensate, retain, and oversee the independent auditors.

The Committee also prepares the report that SEC rules require be included in the Corporation’s annual proxy statement. This report is on pages 27 and 28.

The Audit Committee has adopted specific policies and procedures for pre-approving fees paid to the independent auditors. Under the Audit Committee’s approach, an annual program of work is approved each October for the following categories of services: Audit, Audit-Related, and Tax. Additional engagements may be brought forward from time to time for pre-approval by the Audit Committee. Pre-approvals apply to engagements within a category of service, and cannot be transferred between categories. If fees might otherwise exceed pre-approved amounts for any category of permissible services, the incremental amounts must be reviewed and pre-approved prior to commitment. The complete text of the Audit Committee’s pre-approval policies and procedures, as well as the Committee’s charter, is posted on the Corporate Governance section of ExxonMobil’s website.

The Board has determined that all members of the Committee are financially literate within the meaning of the NYSE standards, and that Ms. Burns, Mr. Oberhelman, and Mr. Weldon are “audit committee financial experts” as defined in the SEC rules.

 

16						2019 Proxy Statement

Compensation Committee

The Compensation Committee is comprised exclusively of non-employee, independent directors, and oversees compensation for ExxonMobil’s senior executives (including salary, bonus, and performance share awards), as well as succession planning for key executive positions. The Committee’s charter is available on the Corporate Governance section of our website.

During 2018, the Committee took the following actions:

 

•

Reviewed and approved the corporate goals and objectives relevant to the compensation of the CEO;

 

•

Reviewed the Corporation’s business results and progress on strategic plans during the year with ExxonMobil’s CEO and other senior executives;

 

•

Carefully considered the results of the 2018 advisory vote on executive compensation;

 

•

Assessed each element of the Company’s compensation program and practices, and confirmed that they do not create any material adverse risks for the Company. The key design features of the compensation program that discourage executives from taking inappropriate risk are described in detail in this proxy statement (see pages 32, and 45 to 48);

 

•

Discussed the Company’s executive compensation program with its independent consultant;

 

•

Established the aggregate annual ceilings for the 2018 short-term and long-term incentive award programs taking into account input received from the CEO and other senior executives;

 

•

Approved the salary program for 2019;

 

•

Reviewed the performance and contributions of, and granted incentive awards and salary for, the CEO. The CEO does not participate in or provide input to decisions regarding his own compensation;

 

•

Reviewed the individual performance and contributions of, and granted individual incentive awards and set salaries for, other senior executives based on recommendations to the Committee by the CEO; and

 

•

Reviewed progress on executive development and succession planning for senior-level positions with input from the CEO.

The Committee does not delegate its responsibilities with respect to ExxonMobil’s executive officers and other senior executives (currently 21 positions). For other employees, the Committee delegates authority to determine individual salaries and incentive awards to a committee consisting of the Chairman and the Senior Vice Presidents of the Corporation. That committee’s actions are subject to a salary budget and aggregate annual ceilings on short-term and long-term incentive awards established by the Compensation Committee.

For more information on the compensation decisions made by the Committee for 2018, refer to the Compensation Discussion and Analysis (“CD&A”) beginning on page 31.

The Compensation Committee’s report is available on page 30.

The Compensation Committee utilizes the expertise of an external independent consultant, Pearl Meyer. At the direction of the Committee, Pearl Meyer:

 

•

Attends Committee meetings;

 

•

Informs the Committee regarding general trends in executive compensation across industries;

 

•

Prepares the analysis of comparator company compensation used by the Committee; and

 

•

Participates in the Committee’s deliberations regarding compensation for Named Executive Officers.

In addition, at the direction of the Chair of the Board Affairs Committee, Pearl Meyer provides an annual survey of non-employee director compensation for use by that Committee.

 

2019 Proxy Statement				17

The Compensation Committee is solely and directly responsible for the appointment, compensation, and oversight of the consultant. The Committee considers factors that could affect Pearl Meyer’s independence, including that the consultant provides no other services for ExxonMobil other than its engagement by the Committee and the Board Affairs Committee as described above. Based on this review, the Committee has determined the consultant’s work for the Committee to be free from conflicts of interest.

Finance Committee

The Finance Committee reviews ExxonMobil’s financial policies and strategies, including our capital structure, dividends, and share purchase program. The Committee authorizes the issuance of corporate debt subject to limits set by the Board. The Committee’s charter is available on the Corporate Governance section of our website.

Public Issues and Contributions Committee

The Public Issues and Contributions Committee reviews the effectiveness of the Corporation’s policies, programs, and practices with respect to safety, security, health, the environment, including climate-related matters, and social issues. The Committee hears reports from operating units on safety and environmental activities, and also visits operating sites to observe and comment on current operating practices. In addition, the Committee reviews the level of ExxonMobil’s support for education and other public service programs, including the Company’s contributions to the ExxonMobil Foundation. The Foundation works to improve the quality of education in the United States at all levels, with special emphasis on math and science. The Foundation also supports the Company’s other cultural and public service giving. The Committee’s charter is available on the Corporate Governance section of our website.

Executive Committee

The Executive Committee has broad power to act on behalf of the Board. In practice, the Committee meets only when it is impractical to call a meeting of the full Board.

 

Shareholder Engagement   We believe ongoing engagement with our shareholders is vitally important. ExxonMobil understands the importance of keeping shareholders informed about our business, understanding our shareholders’ perspectives, and addressing areas of interest. In 2018, the Company held shareholder engagements on environmental, social, and governance matters with institutional investors, pension funds, and labor, religious, and nongovernmental organizations representing more than 1.3 billion shares, or approximately 30 percent of total shares outstanding and 55 percent of institutional shareholdings. The number of engagements with shareholders on environmental, social, and governance issues has more than doubled since 2014. Additionally, during 2018 we engaged with shareholders representing nearly 1 billion shares on a range of other issues of importance to ExxonMobil’s business. Our engagement efforts include members of senior management, subject matter experts, and non-employee directors.   The Company communicates with shareholders through a variety of means, including publications we issue throughout the year; our website (including the Perspectives blog); the annual shareholders meeting; webcasts, including our annual executive compensation and governance webcast during which any shareholder can submit comments or questions; and through direct interface. We welcome and value input from all shareholders, and such input is taken seriously by the Company.   The Board Affairs Committee has approved and implemented procedures for shareholders and other interested persons to send written or electronic communications to individual directors, including the Presiding Director, Board committees, or the non-employee directors as a group.   •   Written Communications: Written correspondence should be addressed to the director or directors in care of the Secretary at the address given under Contact Information on page 7.   •   Electronic Communications: You may send e-mail to individual non-employee directors, Board committees, or the non-employee directors as a group by using the form provided for that purpose on our website at exxonmobil.com/directors.

 

18						2019 Proxy Statement

Item 1 – Election of Directors

The Board of Directors has nominated the director candidates named on the following pages. Personal information about each of our nominees, including public company directorships during the past five years, is provided. Also included are the particular qualifications and competencies of each director nominee that led the Board to conclude that such person should serve as a director of the Company. All of our nominees currently serve as ExxonMobil directors.

All director nominees have stated they are willing to serve if elected. If a nominee becomes unavailable before the election, your proxy authorizes the people named as proxies to vote for a replacement nominee if the Board names one. Alternatively, the Board may reduce its size to equal the number of remaining nominees.

The Board recommends you vote FOR each of the following candidates:

 

Susan K. Avery
Principal occupation: President Emerita, Woods Hole Oceanographic Institution   Age 69 Director since 2017 Independent director   Committees: Board Affairs, Public Issues and Contributions		Background:   •   Achieved prominence in her field at the Woods Hole Oceanographic Institution, a global research organization, as President and Director from 2008 to 2015. In the course of her lengthy and varied experience with matters of climate science, Dr. Avery has been involved with areas of policy, carbon pricing, renewable energy, and adaptation.   •   Academic leadership at the University of Colorado Boulder as interim dean of the graduate school and vice chancellor for research, interim provost, and executive vice chancellor for academic affairs from 2004 to 2008   •   Government / scientific research experience as past member of the United Nations Scientific Advisory Board and the National Research Council Global Change Research Program Advisory Committee   •   Scientific and research advisory committee memberships held or recently held at NASA, NOAA, National Science Foundation, Lawrence Berkeley National Laboratory, National Park System, Independent Advisory Committee on Applied Climate Risk, Center for Southern Hemisphere Ocean Research, Qingdao National Laboratory for Marine Science and Technology, and Japan Agency for Marine-Earth Science and Technology   •   Scientific and environmental affiliations: University Corporation for Atmospheric Research (Chair of Board), Consortium for Ocean Leadership (senior fellow), American Geophysical Union, American Meteorological Society (fellow), American Association for the Advancement of Science (fellow), and Institute of Electrical and Electronics Engineers (fellow)   Current public company directorships: None   Previous public company directorships in last five years: None

 

2019 Proxy Statement				19

Angela F. Braly
Principal occupation: Former Chairman of the Board, President, and Chief Executive Officer, WellPoint (now Anthem)   Age 57 Director since 2016 Independent director     Committees: Compensation, Public Issues and Contributions		Background:   •   Business leadership with operational experience at WellPoint as Chairman from 2010 to 2012; as President and Chief Executive Officer from 2007 to 2012; and as Executive Vice President, General Counsel, and Chief Public Affairs Officer from 2005 to 2007. She also served as President and Chief Executive Officer of Blue Cross Blue Shield of Missouri from 2003 to 2005.   •   Business and public policy affiliations: The Policy Circle (Co-Founder, Director, and Secretary), Indiana Economic Development Corporation (former Director), Business Council (former member), Business Roundtable (former member), Harvard Advisory Council on Health Care Policy, and Blue Cross Blue Shield Association (former Director)   Current public company directorships: Brookfield Asset Management Inc. (May 2015 to Present); Lowe’s Companies, Inc. (November 2013 to Present); Procter & Gamble (December 2009 to Present)   Previous public company directorships in last five years: None   Other board experience: former Director of WellPoint, Inc. (prior to 2014)

 

Ursula M. Burns
Principal occupation: Chairman of the Board and Chief Executive Officer, VEON Ltd.   Age 60 Director since 2012 Independent director     Committees: Audit, Executive, Finance		Background:   •   Global business leadership with operational experience at Xerox as Chairman from 2010 to 2017; as Chief Executive Officer from 2009 to 2016; and as President from 2007 to 2016. She also served as Senior Vice President, Corporate Strategic Services; and Senior Vice President and President, Document Systems and Solutions Group, and Business Group Operations, at Xerox. She is currently Chairman and CEO of VEON Ltd.   •   Government and public policy experience as Vice Chair and Chair of the President’s Export Council (2010 to 2016)   •   Scientific, academic, and non-profit affiliations: Ford Foundation (Trustee), National Academy Foundation, Mayo Clinic (counsel/advisor), MIT Corporation (Trustee), National Academy of Engineers (member), American Academy of Arts and Sciences (member), Cornell Technology Board of Overseers (counsel/advisor), New York City Ballet Inc. (Director)   Current public company directorships: Nestlé S. A. (April 2017 to Present); VEON Ltd. (July 2017 to Present)   Previous public company directorships in last five years: American Express (January 2004 to May 2018); Xerox (April 2007 to June 2017)   Other board experience: former Director of Boston Scientific (prior to 2014)

 

20						2019 Proxy Statement

Kenneth C. Frazier
Principal occupation: Chairman of the Board, President, and Chief Executive Officer, Merck & Co., Inc.   Age 64 Director since 2009 Independent director     Committees: Board Affairs, Compensation, Executive		Background:   •   Global business leadership with operational experience at Merck & Co., Inc. as Chairman and Chief Executive Officer from 2011 to present; as President from 2010 to present; and as Executive Vice President and President, Global Human Health, from 2007 to 2010. He also served as Executive Vice President and General Counsel.   •   Legal and business affiliations: American Law Institute, Business Council, and American Bar Association   •   Scientific and research affiliations: Pharmaceutical Research and Manufacturers of America, Weill Cornell Medicine, and American Academy of Arts and Sciences   Current public company directorships: Merck & Co., Inc. (January 2011 to Present)   Previous public company directorships in last five years: None

 

Steven A. Kandarian
Principal occupation: Chairman of the Board, President, and Chief Executive Officer, MetLife   Age 67 Director since 2018 Independent director   Committees: Compensation, Public Issues and Contributions		Background:   •   Global business leadership with operational experience at MetLife, Inc. as Chairman since 2012; as President and Chief Executive Office since 2011; and as Executive Vice President and Chief Investment Officer from 2005 to 2011. He also served as Executive Director of the Pension Benefit Guaranty Corporation from 2001 to 2004.   •   Business and cultural affiliations: Business Roundtable, Business Council, Partnership for New York City (Director), Institute of International Finance (former Director and Chair, Insurance Regulatory Committee), and the Lincoln Center for the Performing Arts (former Director)   •   Scientific and research affiliations: Damon Runyon Cancer Research Foundation (Director)   Current public company directorships: MetLife (May 2011 to Present); AECOM (March 2019 to Present)   Previous public company directorships in last five years: None

 

2019 Proxy Statement				21

Douglas R. Oberhelman
Principal occupation: Former Chairman of the Board and Chief Executive Officer, Caterpillar Inc.   Age 66 Director since 2015 Independent director     Committees: Audit, Finance		Background:   •   Global business leadership with operational and commodity business experience at Caterpillar Inc. as Chairman from 2010 to 2017; as Chief Executive Officer from 2010 to 2016; as Group President of Caterpillar from 2002 to 2010; and as Vice President, Engine Products Division from 1998 to 2002. He also served as Vice President and Chief Financial Officer from 1995 to 1998.   •   Business and charitable affiliations: Business Roundtable (former Chairman), National Association of Manufacturers (former Chairman), Easter Seals Foundation of Central Illinois (Chairman), Gilmore Foundation (Vice President and Director), and Intersect Illinois (Director)   •   Environmental conservation: Wetlands America Trust (Vice President), Max McGraw Wildlife Foundation (Director)   Current public company directorships: Bombardier (November 2017 to Present)   Previous public company directorships in last five years: Caterpillar Inc. (July 2010 to March 2017); Eli Lilly and Company (December 2008 to February 2015)   Other board experience: Director of Peter Kiewit Sons’, Inc. (August 2017 to Present); Chairman and Director of Switch Rail Safety Systems, LLC (June 2018 to Present); former Director of Ameren Corporation (prior to 2014)

 

Samuel J. Palmisano
Principal occupation: Former Chairman of the Board, President, and Chief Executive Officer, IBM   Age 67 Director since 2006 Independent director     Committees: Board Affairs, Compensation, Executive		Background:   •   Global business leadership with operational experience at IBM as Chairman, President, and Chief Executive Officer from 2003 to 2012. He also served as President, Senior Vice President, and Group Executive for IBM’s Enterprise Systems Group, IBM Global Services, and IBM’s Personal Systems Group.   •   Business and public policy affiliations: The Center for Global Enterprise (Chairman), Business Roundtable, Executive Committee of the Council on Competitiveness, and Commission on Enhancing National Cybersecurity (former Vice Chair)   Current public company directorships: American Express (March 2013 to Present)   Previous public company directorships in last five years: None   Other board experience: former Director of Gannett Co. and IBM (both prior to 2014)

 

22						2019 Proxy Statement

Steven S Reinemund
Principal occupation: Former Chairman of the Board and Chief Executive Officer, PepsiCo   Age 71 Director since 2007 Presiding director since 2016 Independent director     Committees: Board Affairs, Public Issues and Contributions, Executive		Background:   •   Global business leadership with operational experience at PepsiCo as Executive Chairman of the Board from 2006 to 2007; as Chairman and Chief Executive Officer from 2001 to 2006; and as President and Chief Operating Officer from 1999 to 2001. He also served as President and CEO of Frito-Lay and Pizza Hut.   •   Academic leadership at Wake Forest University as Dean of Business from 2008 to 2014; and as Professor of Leadership and Strategy   •   Business affiliations: U.S. Naval Academy Foundation (Board of Trustees), Newman’s Own Foundation (Advisory Board), and Center for Creative Leadership (Board of Governors)   •   Scientific, research, and academic affiliations: The Cooper Institute (Board of Directors), and Wake Forest University (Board of Trustees)   Current public company directorships: GS Acquisition Holdings Corp. (June 2018 to Present); Marriott International, Inc. (April 2007 to Present); Walmart Inc. (June 2010 to Present)   Previous public company directorships in last five years: American Express (April 2007 to May 2015)   Other board experience: former Director of Johnson & Johnson and PepsiCo (both prior to 2014)

 

William C. Weldon
Principal occupation: Former Chairman of the Board and Chief Executive Officer, Johnson & Johnson   Age 70 Director since 2013 Independent director     Committees: Audit, Finance		Background:   •   Global business leadership with operational experience at Johnson & Johnson as Chairman and Chief Executive Officer from 2002 to 2012; as Vice Chairman from 2001 to 2002; and as Worldwide Chairman, Pharmaceuticals Group from 1998 to 2001.   •   Business affiliations: Business Council (former Vice Chairman), Business Roundtable, and Healthcare Leadership Council   •   Scientific, research and academic affiliations: Pharmaceutical Research and Manufacturers of America (former Chairman), Quinnipiac University Board of Trustees (Chairman), and CEO Roundtable on Cancer (former Chairman)   Current public company directorships: CVS Caremark (March 2013 to Present); JPMorgan Chase (March 2005 to Present)   Previous public company directorships in last five years: The Chubb Corporation (May 2013 to January 2016)   Other board experience: former Director of Johnson & Johnson (prior to 2014)

 

2019 Proxy Statement				23

Darren W. Woods
Principal occupation: Chairman of the Board and Chief Executive Officer, Exxon Mobil Corporation   Age 54 Director since 2016     Committees: Finance, Executive		Background:   •   Global business leadership at Exxon Mobil Corporation as Chairman and Chief Executive Officer since 2017; as President in 2016; and as Senior Vice President in 2014 and 2015. He also served as Vice President, and President, ExxonMobil Refining & Supply Company from 2012 to 2014.   •   Operational and commodity business experience with positions of increasing responsibility in domestic and international business operations at ExxonMobil Refining & Supply Company, ExxonMobil Chemical Company, and Exxon Company International   •   Business affiliations: Business Roundtable, American Petroleum Institute (Chair), Business Council, Center for Strategic and International Studies (Trustee), Oil and Gas Climate Initiative, and National Petroleum Council   •   Scientific and environmental experience: ExxonMobil Chemical Company and ExxonMobil Refining & Supply Company   Current public company directorships: None   Previous public company directorships in last five years: Imperial Oil Ltd. (April 2013 to July 2014)

Director Compensation

Director compensation elements are designed to:

 

•

Ensure alignment with long-term shareholder interests;

 

•

Ensure the Company can attract and retain outstanding director candidates who meet the selection criteria outlined in the Guidelines for Selection of Non-Employee Directors, which can be found on the Corporate Governance section of our website;

 

•

Recognize the substantial time commitment necessary to oversee the affairs of the Corporation; and

 

•

Support the independence of thought and action expected of directors.

Non-employee director compensation levels are reviewed by the Board Affairs Committee each year, and resulting recommendations are presented to the full Board for approval. The Committee uses an independent consultant, Pearl Meyer, to provide information on current developments and practices in director compensation. Pearl Meyer is the same consultant retained by the Compensation Committee to advise on executive compensation, but performs no other work for ExxonMobil.

ExxonMobil employees receive no additional pay for serving as directors.

Non-employee directors receive compensation consisting of cash and equity in the form of restricted stock. Non-employee directors are also reimbursed for reasonable expenses incurred to attend Board meetings or other functions relating to their responsibilities as a director of Exxon Mobil Corporation.

The annual cash retainer for non-employee directors in 2018 was $110,000 per year. Chairs of the Audit and Compensation Committees and the Presiding Director receive an additional $10,000 per year.

A significant portion of director compensation is granted in the form of restricted stock to align director interests with the interests of our long-term shareholders. The annual restricted stock award grant for incumbent non-employee directors is 2,500 shares. A new non-employee director receives a one-time grant of 8,000 shares of restricted stock upon first being elected to the Board.

 

24						2019 Proxy Statement

While on the Board, the non-employee director receives the same cash dividends on restricted shares as a holder of regular common stock, but the shares remain unvested and, thus, cannot be sold or pledged. The restricted shares are subject to forfeiture if the non-employee director leaves the Board early, i.e., before the retirement age of 72, as specified for non-employee directors.

Current and former non-employee directors of Exxon Mobil Corporation are eligible to participate in the ExxonMobil Foundation’s Educational and Cultural Matching Gift Programs under the same terms as the Corporation’s U.S. employees.

Director Compensation for 2018

 

Name		Fees Earned or Paid in Cash ($)				Stock Awards ($)(a)				Option   Awards   ($)		Non-Equity Incentive Plan Compensation ($)		Change in Pension Value and Nonqualified Deferred   Compensation   Earnings ($)		Other Compensation ($)(b)		Total ($)
S.K. Avery			110,000				211,075			0		0		0		286			321,361
M.J. Boskin(c)			45,632				211,075			0		0		0		119			256,826
A.F. Braly			110,000				211,075			0		0		0		286			321,361
U.M. Burns			120,000				211,075			0		0		0		286			331,361
K.C. Frazier			110,000				211,075			0		0		0		286			321,361
S.A. Kandarian			100,528				706,400			0		0		0		239			807,167
D.R. Oberhelman			110,000				211,075			0		0		0		286			321,361
S.J. Palmisano			120,000				211,075			0		0		0		286			331,361
S.S Reinemund			120,000				211,075			0		0		0		286			331,361
W.C. Weldon			110,000				211,075			0		0		0		286			321,361

 

(a)	In accordance with SEC rules, the valuation of stock awards in this table represents fair value on the date of grant. Dividends on stock awards are not shown in the table because those amounts are factored into the grant date fair value.

Each director (other than Mr. Kandarian, who joined the Board in February 2018) received an annual grant of 2,500 restricted shares in January 2018. The valuation of these awards is based on a market price of $84.43 on the date of grant.

Mr. Kandarian received a one-time grant of 8,000 restricted shares upon first being elected to the Board in February 2018. The valuation of this award is based on the market price of $88.30 on the date of the grant.

At year-end 2018, the aggregate number of restricted shares held by each director was as follows:

 

Name		Restricted Shares (#)
S.K. Avery		10,500
A.F. Braly		13,000
U.M. Burns		23,000
K.C. Frazier		30,500
S.A. Kandarian		8,000
D.R. Oberhelman		15,500
S.J. Palmisano		39,500
S.S Reinemund		35,500
W.C. Weldon		20,500

 

(b)	The amount shown for each director is the cost of travel accident insurance covering death, dismemberment, or loss of sight, speech, or hearing under a policy purchased by the Corporation with a maximum benefit of $500,000 per individual.

(c)	Retired effective May 30, 2018.

 

2019 Proxy Statement				25

The non-employee directors are not entitled to any additional payments or benefits as a result of leaving the Board or death except as described above. The non-employee directors are not entitled to any payments or benefits resulting from a change in control of the Corporation.

Certain Beneficial Owners

Based on our review of ownership reports filed with the SEC, the firms listed below are the only beneficial owners of more than 5 percent of ExxonMobil’s outstanding common stock as of December 31, 2018.

 

Name and Address of Beneficial Owner		Shares Owned					Percent of                   Class
The Vanguard Group 100 Vanguard Blvd. Malvern, PA 19355				340,023,050			8.0%
BlackRock, Inc. 55 East 52nd Street New York, NY 10055				285,575,768			6.7%

Director and Executive Officer Stock Ownership

These tables show the number of ExxonMobil common shares each executive named in the Summary Compensation Table on page 49 and each non-employee director or director nominee owned on February 28, 2019. In these tables, ownership means the right to direct the voting or the sale of shares, even if those rights are shared with someone else. None of these individuals owns more than 0.02 percent of the outstanding shares.

 

Named Executive Officer		Shares Owned(1)				Shares Covered by          Exercisable Options
D.W. Woods			80,291			0
N.A. Chapman			95,588	(2)		0
N.W. Duffin			270,548	(3)		0
A.P. Swiger			497,951			0
J.P. Williams, Jr.			82,193			0

 

(1)	Does not include unvested restricted stock units, which do not carry voting rights prior to the issuance of shares on settlement of the awards.

(2)	Includes 14,245 shares jointly owned with spouse.

(3)	Co-trustee and co-beneficiary with spouse in family trust for 113,058 shares.

 

Non-Employee Director		Shares Owned
S.K. Avery		13,000
A.F. Braly		17,575(1)
U.M. Burns		25,706
K.C. Frazier		33,000
S.A. Kandarian		10,500
D.R. Oberhelman		18,000
S.J. Palmisano		42,000
S.S Reinemund		48,125
W.C. Weldon		24,209

 

(1)	Includes 1,175 shares owned by spouse and 900 shares held in trusts for family members for which Ms. Braly serves as co-trustee.

 

26						2019 Proxy Statement

On February 28, 2019, ExxonMobil’s incumbent directors and executive officers (27 people) together owned 2,204,887 shares of ExxonMobil stock and zero shares covered by exercisable options, representing about 0.05 percent of the outstanding shares.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities and Exchange Act of 1934 requires our executive officers and directors to file reports of their ownership and changes in ownership of ExxonMobil stock on Forms 3, 4, and 5 with the SEC. We are not aware of any unfiled or late reports for 2018.

Audit Committee Report

The primary function of our Audit Committee is oversight of the Corporation’s financial reporting process, public financial reports, internal accounting and financial controls, and the independent audit of the annual consolidated financial statements. Our Committee acts under a charter, which can be found on the ExxonMobil website at exxonmobil.com/auditcommitteecharter. We review the adequacy of the charter at least annually. All of our members are independent directors. We held 11 meetings in 2018 at which, as discussed in more detail below, we had extensive reports and discussions with the independent auditors, internal auditors, and members of management.

In performing our oversight function, we reviewed and discussed the consolidated financial statements with management and PricewaterhouseCoopers LLP (“PwC”), the independent auditors. Management and PwC indicated that the Corporation’s consolidated financial statements were fairly stated in accordance with generally accepted accounting principles. We discussed significant accounting policies applied by the Corporation in its financial statements, as well as alternative treatments. We discussed with PwC matters covered by Public Company Accounting Oversight Board (“PCAOB”) standards, including PCAOB AS 1301 Communication with Audit Committees. In addition, we reviewed and discussed management’s report on internal control over financial reporting and the related audits performed by PwC, which confirmed the effectiveness of the Corporation’s internal control over financial reporting.

We also discussed with PwC its independence from the Corporation and management, including the communications PwC is required to provide us under applicable PCAOB rules. We considered the non-audit services provided by PwC to the Corporation, and concluded that the auditors’ independence has been maintained.

We discussed with the Corporation’s internal auditors and PwC the overall scope and plans for their respective audits. We met with the internal auditors and PwC at each meeting, both with and without management present. Discussions included the results of their examinations, their evaluations of the Corporation’s internal controls, and the overall quality of the Corporation’s financial reporting.

We discussed with the Corporation’s management the comprehensive, long-standing risk management and compliance processes of the Corporation, and reviewed several topics of interest.

Based on the reviews and discussions referred to above, in reliance on management and PwC, and subject to the limitations of our role described below, we recommended to the Board, and the Board approved, the inclusion of the audited financial statements in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2018, for filing with the SEC.

In carrying out our responsibilities, we look to management and the independent auditors. Management is responsible for the preparation and fair presentation of the Corporation’s financial statements and for maintaining effective internal control. Management is also responsible for assessing and maintaining the effectiveness of internal control over the financial reporting process in compliance with Sarbanes-Oxley Section 404 requirements. The independent auditors are responsible for auditing the Corporation’s annual financial statements, and expressing an opinion as to whether the statements are fairly stated in conformity with generally accepted accounting principles. In addition, the independent auditors are responsible for auditing the Corporation’s internal control over financial reporting and for expressing an opinion on the effectiveness of internal control over financial reporting. The

 

2019 Proxy Statement				27

independent auditors perform their responsibilities in accordance with the standards of the PCAOB. Our members are not professionally engaged in the practice of accounting or auditing, and are not experts under the Securities Act of 1933 in either of those fields or in auditor independence.

We have also appointed PwC to audit the Corporation’s financial statements for 2019, subject to shareholder ratification of that appointment. The Committee annually evaluates, along with the other members of the Board, management, the Controller, and the General Auditor, PwC’s qualifications, performance, and independence, including the performance of the lead audit partner, in deciding whether or not to retain PwC. That evaluation includes consideration of:

 

•

PwC’s quality control, including any material issues identified by that quality control or a governmental/professional authority along with PwC’s plan to deal with any such issues;

 

•

All relationships between PwC and ExxonMobil covered by the PCAOB;

 

•

PwC’s expertise in the global oil and gas industry; and

 

•

The quality of PwC’s audit plans.

The Committee believes that PwC’s tenure as ExxonMobil’s independent registered public accounting firm is a benefit to audit quality given PwC’s experience with ExxonMobil and knowledge of the business, as well as the effectiveness of their audit plans, which build on that established knowledge.

Based on the Committee’s annual evaluation of PwC’s qualifications, performance, and independence, as well as frequent private meetings with the lead partner, we believe that the continued retention of PwC as ExxonMobil’s independent registered public accounting firm is in the best interest of the Corporation and its stockholders.

 

Ursula M. Burns, Chair		Douglas R. Oberhelman
William C. Weldon

Item 2 – Ratification of Independent Auditors

The Audit Committee has appointed PricewaterhouseCoopers LLP (“PwC”) to audit ExxonMobil’s financial statements for 2019. We are asking you to ratify that appointment.

Total Fees

The total fees for PwC professional services rendered to ExxonMobil for the year ended December 31, 2018, were $41.2 million, a decrease of $3.9 million from 2017. The Audit Committee reviewed and pre-approved all services in accordance with the service pre-approval policies and procedures, which can be found on the ExxonMobil website at exxonmobil.com/pre-approval. The Audit Committee did not use the “de minimis” exception to pre-approval that is available under SEC rules. The following table summarizes the fees, which are described in more detail below.

 

		2018					2017
		(millions of dollars)
Audit Fees				31.4					32.2
Audit-Related Fees				8.8					11.4
Tax Fees				1.0					1.5
All Other Fees				—					—
Total				41.2					45.1

Audit Fees

The aggregate fees for PwC professional services rendered for the annual audits of ExxonMobil’s financial statements for the year ended December 31, 2018, and for the reviews of the financial statements included in our quarterly reports on Form 10-Q for that year were $31.4 million (versus $32.2 million for 2017), with the decrease primarily due to lower acquisition-related work and foreign exchange impacts.

 

28						2019 Proxy Statement

Audit-Related Fees

The aggregate fees for PwC Audit-Related services rendered to ExxonMobil for the year ended December 31, 2018, were $8.8 million (versus $11.4 million for 2017), with the decrease primarily due to lower regulatory support work. Audit-related services were mainly related to benefit plan audits and other attestation procedures.

Tax Fees

The aggregate fees for PwC Tax services rendered to ExxonMobil for the year ended December 31, 2018, were $1.0 million (versus $1.5 million for 2017), with the decrease primarily due to lower acquisition-related work. These services were mainly related to assisting various ExxonMobil affiliates with the preparation of local tax filings and related services.

All Other Fees

The aggregate fees for PwC services rendered to ExxonMobil, other than the services described above under “Audit Fees,” “Audit-Related Fees,” and “Tax Fees,” for the year ended December 31, 2018, were zero (also zero for 2017).

We believe PwC is well qualified to perform this work. A PwC representative will be at the annual meeting to answer appropriate questions and to make a statement if desired.

The Audit Committee recommends you vote FOR this proposal.

 

2019 Proxy Statement				29

Compensation Committee Report

The Compensation Committee of the Board of Directors has reviewed and discussed the Compensation Discussion and Analysis with management of the Corporation. Based on that review and discussion, we recommended to the Board that the Compensation Discussion and Analysis be included in the Corporation’s proxy statement for the 2019 annual meeting of shareholders, and also incorporated by reference in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2018.

 

Samuel J. Palmisano, Chair		Angela F. Braly
Kenneth C. Frazier		Steven A. Kandarian

Item 3 – Advisory Vote to Approve Executive Compensation

At the meeting, shareholders will be asked to vote on a non-binding resolution to approve the compensation of the Named Executive Officers (NEOs), listed in the Summary Compensation Table.

When casting your vote, we encourage you to consider the content of our Executive Compensation Overview and detailed information included in the Compensation Discussion and Analysis beginning on page 31.

The Board continues to support the overall design of the compensation program, which is characterized by three key features:

 

•

Ties executive compensation to the returns of long-term shareholders – The majority of compensation is delivered in the form of performance shares, linking the ultimate value of pay to the performance of ExxonMobil stock.

 

•

Recognizes the long-term nature of ExxonMobil’s business model – Performance shares are subject to the longest restriction periods in the industry, including through the commodity price cycle. A significant portion of executive pay vests only after retirement. Therefore, executives are encouraged to take a long-term view in their business decision making.

 

•

Links executives’ compensation to Company performance – The number of shares at grant is determined by relative Company performance versus industry peers, progress toward strategic objectives including strengthening the Company’s growth strategy, and market orientation of total compensation. We set the highest performance standards, requiring industry-leading results over the investment lead times of the business in pre-established metrics.

For 2018, Company performance remains industry leading in all but one of these performance metrics, Total Shareholder Return (TSR). Compensation levels for the CEO and NEOs reflect these results.

We continue to listen and respond to the feedback we receive from shareholders during our shareholder engagement process. As in previous years, we enhanced disclosures in response to shareholder feedback.

The Board recommends an advisory vote FOR the following resolution:

RESOLVED: That shareholders approve the compensation of the Named Executive Officers as disclosed pursuant to Item 402 of SEC Regulation S-K, including the Compensation Discussion and Analysis, compensation tables, and narrative discussion on pages 31 to 57 of this proxy statement.

 

30						2019 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS

 

							Page
Executive Compensation Overview		•		Letter to Shareholders			32
		•		Strong Governance Practices			32
		•		Executive Summary – Why Vote “FOR” Say-on-Pay?			33
		•		Business Overview			34
		•		Compensation Program Design			34
		•		Performance Share Program			34
		•		Progress Toward Strategic Objectives			37
		•		Financial and Operating Performance			38
		•		Annual Benchmarking / Scale and Complexity			39
		•		Bonus Program			40
		•		Pay for CEO Position			40
Key Elements of the Compensation Program and Compensation Committee 2018 Decisions		•		Performance Share Program			43
		•		Bonus Program			43
		•		Salary			44
		•		Retirement Plans			44
Guidelines, Policies, and Practices		•		Benchmarking Principles			45
		•		Performance Measurements			46
		•		Share Utilization			46
		•		Granting Practices			47
		•		Stock Ownership			47
		•		Anti-Hedging Policy			47
		•		Clawback Policy and Forfeiture Provisions			47
		•		Employment Arrangements			48
		•		Tax Matters			48
Shareholder Engagement		•		Shareholder Engagement and Prior Say-on-Pay Vote			48
Executive Compensation Tables and Narratives		•		Summary Compensation Table			49
		•		Grants of Plan-Based Awards			52
		•		Outstanding Equity Awards			53
		•		Stock Vested			54
		•		Pension Benefits			54
		•		Nonqualified Deferred Compensation			56
		•		Administrative Services for Retired Employee Directors			57
		•		Health Care Benefits			57
		•		Unused Vacation			57
		•		Termination and Change in Control			57
		•		Payments in the Event of Death			57

 

2019 Proxy Statement				31

LETTER TO SHAREHOLDERS Fellow Shareholders, Before you cast your vote on Management Resolution Item 3 - Advisory Vote to Approve Executive Compensation, the members of the Board's independent Compensation Committee encourage you to review the content of this Executive Compensation Overview, as well as the additional detail provided in the Compensation Discussion and Analysis, compensation tables, and narrative in ExxonMobil's 2019 Proxy Statement. The Compensation Committee reviews the effectiveness and competitiveness of the executive compensation program on an annual basis. ExxonMobil's business involves large investments over long periods of time that require executives to maintain a long-term view when making business decisions. The Company's executive compensation program is designed to reflect this. The Compensation Committee continues to support the design of the executive compensation program. It allows the Committee to leverage the experience and judgment of its members, across a mix of critical performance factors, to grant pay to executives that is both performance-based and aligned with the returns of our long-term shareholders. We encourage you to vote "FOR" Item 3. Samuel J. Palmisano Chair, ExxonMobil Compensation Committee

EXECUTIVE SUMMARY – WHY VOTE “FOR” SAY-ON-PAY?

EXECUTIVE PAY IS ALIGNED WITH COMPANY PERFORMANCE

 

Significant progress toward strategic goals led to an increase in number of performance shares granted to CEO, balanced against relative TSR performance that did not lead the average of industry peers   Maintained industry-leading performance across all other pre-established metrics   2018 bonus program increased as a result of higher 2018 earnings   Pay for CEO position is at 44th percentile of CEO compensation benchmarks(1)

PROGRAM TIES EXECUTIVE PAY TO SHAREHOLDER RETURNS

 

Over 60 percent of CEO pay is in performance shares, with longest restriction periods in any industry   Long-term incentive program results in executives holding much higher percentage of performance shares through full business and commodity price cycles   Compensation program design makes long-term investors of our executives   Executives incentivized to maximize long-term shareholder returns and value while effectively managing risks, including environmental risks

ENHANCED DISCLOSURE IN RESPONSE TO SHAREHOLDER FEEDBACK

 

Provided further clarification on the process and considerations used by the Compensation Committee to determine CEO pay   Illustrated how performance share program aligns with business model   Strengthened disclosure of Company performance metrics that determine share grants   Clarified operation of delayed portion of annual bonus

 

		HIGHLIGHT: SHAREHOLDER ENGAGEMENT   Continued broad engagement on compensation strategy with shareholders and proxy advisors in 2018   ∎ Shareholder engagements with holders of close to half of outstanding institutionally held shares   ∎ Independent director engagement with shareholders on compensation design   ∎ Shareholder webinar to gather input from all shareholders

 

2019 Proxy Statement				33

BUSINESS OVERVIEW

To fully understand the rationale for the design of ExxonMobil’s executive compensation program, it is important to understand the industry in which we operate. The decisions and risks that our executives face play out over time horizons that are often decades in length. Therefore, the intent of the compensation program is to incentivize long-term decision making and align executives’ pay with the results of their decisions and the returns of our long-term shareholders.

The Company’s strategies provide the framework for the organization to deliver on its commitments, create shareholder value throughout the commodity price cycle, and address the dual challenge of meeting the growing demand for energy while reducing environmental impacts. For more information, see the Summary Annual Report.⁽²⁾

COMPENSATION PROGRAM DESIGN

 

ELEMENT				FEATURES
Performance Shares				∎  Targeting over 50 percent of total reported pay
				∎  Performance metrics applied at grant, coupled with long restriction periods
				∎  Aligns level of executive compensation with returns of long-term shareholders
				∎  Encourages long-term view through commodity price cycle
				∎  Places significant portion of executive pay at risk of forfeiture
Annual Bonus				∎  Targeting 10 to 20 percent of total reported pay
				∎  Links compensation to annual business performance
				∎  Actual award determined by individual performance and pay grade
				∎  50 percent of award paid in cash at grant; 50 percent subject to delayed vesting feature    that is based on future earnings performance
				∎  Delayed feature provides medium-term performance metric and puts 50 percent of bonus    at risk of forfeiture
Base Salary				∎  Targeting 10 percent or less of total reported pay
				∎  Provides a base level of competitive income, determined by performance, experience,    and pay grade
				∎  Ties directly to long-term benefits

PERFORMANCE SHARE PROGRAM

DESIGN PRINCIPLES

 

BUSINESS MODEL ALIGNMENT

SHAREHOLDER ALIGNMENT

HIGHEST STANDARDS OF

Investment lead times in oil and gas industry are often 10 years and longer

Majority of CEO pay delivered in performance shares, aligning pay level with returns of long-term shareholders

PERFORMANCE Industry-leading performance across all pre-established metrics required to achieve a maximum award level

LONGEST RESTRICTION PERIODS IN ANY INDUSTRY

PROMOTE LONG-TERM DECISION MAKING

ENHANCE ABILITY TO RETAIN KEY TALENT

Applying performance metrics at grant enables restriction periods of 10 years and longer

Restriction periods and risk of forfeiture encourage executives to focus on risk management and long-term shareholder value

Significant portion of executive pay vests only after retirement

 

34						2019 Proxy Statement

KEY DESIGN FEATURES

WHY APPLY PERFORMANCE METRICS AT GRANT?

 

∎

ExxonMobil’s Compensation Committee considers performance against key metrics in its decision-making process on CEO compensation

 

∎

Industry-leading performance in all pre-established metrics is required for ExxonMobil executives to achieve a maximum performance share award level

 

∎

Applying performance metrics at grant, versus at vest, enables restriction periods on performance shares of 5 years, 10 years, and longer, keeping executives focused on the long-term performance of the Company

 

∎

Long restriction periods also ensure that a significant portion of pay reflects the outcome of long-term business decisions and the experience of long-term shareholders

WHY NOT TARGET SETTING?

 

∎

The Committee considered an alternate program based on a target-setting method that would have determined the number of shares at vest

 

∎

This alternate method requires use of a shorter time horizon to set meaningful, credible targets. This method would encourage short-term thinking, misaligned with long investment lead times and the capital-intensive nature of the business

 

 

 

LONG RESTRICTION PERIODS AND THE COMMODITY PRICE CYCLE   ∎  ExxonMobil’s longer restriction periods ensure that executives are required to hold    shares through the commodity price cycle   ∎  An alternate, formula-based program with short-term target setting and three-year    vesting would enable executives to monetize performance shares at a much faster pace   ∎  In this example, shares are granted to an executive each year over the 10-year period    from 2008 to 2017   – In 2013, on the eve of a greater-than-50-percent decline in crude price, only 8 percent of awards granted in the ExxonMobil program had vested   – In the alternate program with three-year vesting, 58 percent of awards granted would have vested – 7 times more than the ExxonMobil program   ∎  Through long restriction periods, ExxonMobil executives are incentivized to take a long-term    view in decision making		VESTED SHARES AVAILABLE TO SELL IMMEDIATELY PRIOR TO 2013 CRUDE OIL PRICE COLLAPSE(4)

 

2019 Proxy Statement				35

DETERMINING THE NUMBER OF PERFORMANCE SHARES GRANTED TO CEO IN 2018

When deciding on the annual share grant for the CEO, the Compensation Committee relies on: Company performance results relative to industry peers based on pre-established performance metrics; the Company’s progress toward its strategic objectives; and the results of annual compensation benchmarking, including the impact of experience in the position.

 

PROCESS

INPUTS TO COMPENSATION COMMITTEE

 

CONSIDERATIONS (see pages 37 to 39 for additional detail)
FINANCIAL AND OPERATING    PERFORMANCE		PROGRESS TOWARD STRATEGIC OBJECTIVES		ANNUAL COMPENSATION BENCHMARKING
Leading ∎ Safety and Operations Integrity ∎ Return on Average Capital Employed ∎ Cash Flow from Operations and Asset Sales      Not Leading ∎ Total Shareholder Return		Strengthened Company growth strategy   Significant 2018 accomplishments in advancing strategic objectives		10-year combined realized and unrealized pay for the CEO position is at the 44th percentile of compensation benchmark company CEOs

2018 DECISION
150,000    Performance Shares granted to CEO		Compensation Committee increased number of shares versus 2017 due to significant progress toward strategic objectives, continued industry leadership in 3 of 4 financial and operating performance metrics, and results of annual benchmarking given experience in position

COMPENSATION COMMITTEE DOES NOT ADJUST SHARE GRANTS

IN RESPONSE TO CHANGES IN SHARE PRICE

 

36						2019 Proxy Statement