Chevron: Many Issues with Compensation but the Larger Issue is Climate

Annual Meeting  May 25, 2022

Total compensation for Chevron CEO Michael Worth was $22,610,285 for 2021. The company has a history of very high pay and has been on As You Sow’s 100 Most Overpaid CEOs on five different occasions.

While shareholders overall gave average support to the pay package last year, many voted against. Some cited poor disclosure of targets and metrics in voting against the pay package. Others have raised the issue that certain incentive awards can vest even if Chevron’s performance is below the median of its peers. ISS has recommended a vote against this proposal for these and other very specific reasons. All of these bad practices individually as well as the excess are reasons to vote against pay.

But, frankly, the most important reason to vote against pay at Chevron is because it is one of the largest oil companies, and has not shown enough commitment to a just energy transition. As the threat of climate change looms ever more clearly over all of us, companies should be planning for the realities we face and incentivizing the best route forwards.

Earlier this month the Center for American Progress issued a short report “Top 5 Oil Companies Just Raked In $35 Billion While Americans Pay More at the Pump” highlighting the profits these companies made which could have been more usefully spent: “Instead of using this cash to make the investments needed to help lower the price of oil or to fulfill their climate pledges, companies are giving most of it back to their already extremely wealthy shareholders in the form of stock buybacks or giving it back to themselves in the form of executive bonuses.”

Several shareholders have advocated voting against the Chair of the company for these larger concerns. A vote against pay is appropriate too. The climate crisis requires shareholders to use every lever they can.