| ☑ Filed by the Registrant | | |
☐
Filed by a Party other than the Registrant
|
|
| | Check the appropriate box: | | | ||||
| | ☐ | | | | Preliminary Proxy Statement | | |
| | ☐ | | | | CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY RULE 14a-6(e)(2)) | | |
| | ☑ | | | | Definitive Proxy Statement | | |
| | ☐ | | | | Definitive Additional Materials | | |
| | ☐ | | | | Soliciting Material Under Rule 14a-12 | | |
| | Payment of Filing Fee (Check all boxes that apply): | | | ||||
| | ☑ | | | | No fee required. | | |
| | ☐ | | | | Fee paid previously with preliminary materials. | | |
| | ☐ | | | | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a6(i)(1) and 0-11. | | |
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For Our Investors
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For Our Customers
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2023 FINANCIAL PERFORMANCE
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–
Continued success on quality and reliability performance
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Progressed on high return strategic projects, which remain on time, to provide the innovative products our customers seek
LAUNCH OF INDUXTM
–
U. S. Steel’s InduX electrical steel is a very wide, ultra-thin, and light-weight steel, having all the magnetic properties necessary for electric vehicles (EV), as well as generators and transformers. By producing InduX steel in the United States, U. S. Steel is making a significant investment in American jobs and bolstering the resilience of the country’s domestic supply chain
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$18B
Revenues
$2.139B
Adjusted EBITDA
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96%
Total Shareholder
Return
$5.2B
Liquidity
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For Our People
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–
Rewarding employees with performance-based profit sharing and incentives
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Leveraging flexible work from anywhere policies to build corporate culture and engagement and attract and retain diverse talent
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Engaging in the communities where we live and work, with over 21,000 employee service hours
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Record safety performance,
significantly outperforming DAFW industry average reported by U.S. Bureau of Labor
0.04 Days
All-time best days away from work (DAFW)
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Recognized as one of the world’s most ethical companies
“World’s Most Ethical Companies” and “Ethisphere” names
and marks are registered trademarks of Ethisphere LLC. |
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For Our Planet
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–
Excellent adherence to environmental stewardship principles
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Completed non-grain oriented (NGO) electrical steel line, which positions U. S. Steel as a crucial supplier for the expanding electrical vehicle market
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REFRESHED TCFD REPORT
–
In November 2023, we issued an updated Task Force on Climate-Related Financial Disclosures (TCFD) Report to increase transparency on our climate-related risks and opportunities.
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DAVID S. SUTHERLAND
Board Chair |
| |
DEAR FELLOW U. S. STEEL STOCKHOLDERS:
On behalf of the entire Board of Directors, it is my pleasure to invite you to attend our 2024 Annual Meeting of Stockholders, which will be held on Tuesday, April 30th, 2024 at 12:00 p.m., Eastern Time (ET) at www.virtualshareholdermeeting.com/X2024 via live audio webcast.
I have been a part of U. S. Steel’s Board of Directors for over fifteen years, and have served as Board Chair for nearly a decade. As we work towards closing the transaction with Nippon Steel Corporation (NSC), I look back and am amazed by the accomplishments of the Corporation throughout its history, and especially the transformation that has been underway over the last few years. From the initial investment in Big River Steel nearly five years ago, to where we stand today — a new NGO electrical steel line up and running, construction completed on a direct reduced-grade pellet facility, and a second mini mill and coating line pegged for completion this year — is an astounding transition. Our CEO and executive leadership team continue to deliver excellent results for our stockholders.
As a Board, we continue to embrace our duties of providing responsible oversight and maximizing stockholder value. The Board met 16 times in 2023 to conduct the robust review of strategic alternatives, culminating in the agreement with NSC, and to stay informed and carry out our duties. We maintain robust oversight of traditional core areas, such as risk oversight, strategic planning and finance, and have also paid close attention to emerging areas, including sustainability and cybersecurity and other technology risks.
Our Corporate Governance & Sustainability Committee leads our board evaluation process to ensure we are functioning effectively as a group, as well as the board refreshment process to ensure the Board as a whole possesses a diverse set of skills and backgrounds that allow us to approach decisions and oversight from a wholistic viewpoint. The five directors that have joined the Board since 2020 have nearly doubled our racial and gender diversity and brought a breadth of experience from industry, risk oversight and M&A. As we look towards closing the NSC transaction, and an important chapter in the history of this storied corporation, I am grateful to the independent Board for providing leadership continuity by extending the retirement age for John Faraci and myself, and we, along with our other eleven colleagues on the Board, are grateful for your continued support.
Please read the attached Proxy Statement, and we ask that you vote for the proposals to elect the thirteen qualified and committed nominees for director, confirm our strong pay-for-performance executive compensation program and ratify PwC as our independent auditor.
We thank you for your continued support for U. S. Steel and the Board as stewards of your investment.
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When:
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Tuesday, April 30, 2024,
12:00 p.m. Eastern Time |
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Record Date:
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March 4, 2024
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Where:
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Virtual Meeting www.virtualshareholdermeeting.com/X2024
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Your Vote Matters: How to Vote
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Online
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Prior to the Annual Meeting, visit www.proxyvote.com and use the 16-digit control number that appears on your proxy card when you access the webpage.
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Mail
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| Complete and sign the proxy card and return it in the enclosed postage pre-paid envelope. | |
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Phone
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If your shares are held in the name of a broker, bank or other nominees, follow the telephone voting instructions provided on your voting instruction card. If your shares are registered in your name, call 1-800-690-6903 and follow the telephone voting instructions. You will need the 16-digit control number that appears on your proxy.
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At the Meeting
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Stockholders as of March 4, 2024 (the “Record Date”) may attend the virtual Annual Meeting and vote by using the 16-digit control number found on the proxy card, voting instructions or notice you previously received.
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U. S. Steel Tower
600 Grant Street Pittsburgh, PA 15219 |
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1 | | | |
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7 | | | |
| Corporate Governance | | | |
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18 | | |
| Our ESG Framework | | | | | 27 | | |
| Director Compensation | | | | | 29 | | |
| Related Person Transactions Policy | | | | | 32 | | |
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Proposal 2: Advisory Vote on Executive
Compensation |
| | | | 34 | | |
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35 | | | |
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Compensation Discussion and Analysis
(see detailed table of contents on page 36) |
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36 | | |
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59 | | | |
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67 | | | |
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75 | | | |
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76 | | | |
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79 | | |
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Proxy
Summary |
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The Virtual Annual Meeting
will be held:
Tuesday, April 30, 2024
12:00 p.m. Eastern Time
Record Date: March 4, 2024
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|
| | | | | | For more information |
| | Board Recommendation |
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Proposal 1
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Election of Directors
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Page 7
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FOR each Nominee
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Proposal 2
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Advisory Vote on the Compensation of Named Executive Officers
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Page 34
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FOR
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Proposal 3
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Ratification of the Appointment of PricewaterhouseCoopers LLP as Independent Registered Public Accounting Firm
|
| | Page 79 | | |
FOR
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STRATEGIC ALTERNATIVES REVIEW PROCESS
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Following a robust and comprehensive review of strategic alternatives, on December 18, 2023, U. S. Steel entered into an Agreement and Plan of Merger (the “Merger Agreement”), with Nippon Steel North America, Inc., a New York corporation (“Parent”), 2023 Merger Subsidiary, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), and solely as provided in Section 9.13 therein, Nippon Steel Corporation, a Japanese corporation (“Guarantor”), pursuant to which Merger Sub will merge with and into U. S. Steel (the “Merger”) with U. S. Steel surviving the Merger as a wholly-owned subsidiary of Parent. Subject to the terms and conditions set forth in the Merger Agreement, each share of the Company’s common stock, par value $1.00 per share, outstanding immediately prior to the effective time of the Merger (which we refer to as the “Effective Time”) will, at the Effective Time, automatically be converted into the right to receive $55.00 in cash, without interest, subject to any required tax withholding.
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U. S. Steel Committees
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Director Nominee
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Age
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Director
Since |
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Principal Occupation/Experience
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Other
Public Company Boards |
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Audit
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Compensation &
Organization |
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Corporate
Governance & Sustainability |
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Executive
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Tracy A. Atkinson
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59
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2020
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| | Ret. EVP and Chief Administrative Officer, State Street Corporation | | |
3
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■
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■
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| | | | | | |
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Andrea J. Ayers
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60
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2023
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| | Ret. President and Chief Executive Officer, Convergys Corporation | | |
1
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■
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■
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David B. Burritt
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68
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2017
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| | President and CEO, United States Steel Corporation |
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1
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■
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Alicia J. Davis
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53
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2023
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| | Chief Strategy Officer, Lear Corporation |
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0
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■
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■
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Terry L. Dunlap
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64
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2022
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| | Fmr. Interim CEO and President of TimkenSteel and Ret. Executive Vice President of Allegheny Technologies | | |
1
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■
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■
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John J. Engel
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62
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2011
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| | Chairman, President and CEO, WESCO International, Inc. | | |
1
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■
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John V. Faraci
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74
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2019
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Fmr. Executive Chairman, Carrier Global Corporation and Ret. Chairman and CEO, International Paper Co.
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0
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■
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Murry S. Gerber
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71
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2012
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| | Ret. Chairman and CEO, EQT Corporation | | |
2
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■
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Jeh C. Johnson
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66
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2020
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Partner, Paul, Weiss, Rifkind, Wharton & Garrison LLP and Fmr. Secretary, Dept. of Homeland Security
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2
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■
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■
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Paul A. Mascarenas
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62
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2016
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Ret. Chief Technical Officer, Ford Motor Company
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2
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■
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Michael H. McGarry
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66
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2019
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Ret. Executive Chairman & CEO, PPG Industries Inc.
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2
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■
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■
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David S. Sutherland (Independent Board Chair)
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74
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2008
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Ret. President and CEO, IPSCO, Inc.
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1
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■
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Patricia A. Tracey
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73
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2007
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| | Ret. VP, Homeland Security and Defense Services, HP Enterprise Services | | |
0
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■
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■
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| | | |
2 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 3 |
|
We are committed to good corporate governance, which promotes the long-term interests of stockholders, strengthens Board and management accountability, and helps build public trust in U. S. Steel. Our governance highlights include:
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Annual election of directors
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12 of our 13 director nominees are independent, including the Board Chair
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Independent Audit, Compensation & Organization, and Corporate Governance & Sustainability committees
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Regular executive sessions of independent directors
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Robust oversight of strategic objectives, risk management and ESG by full Board and committees
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Annual Board and committee self-evaluations
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Executive compensation driven by pay-for-performance philosophy
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Active Board refreshment approach to ensure Board composition aligns with corporate strategy and reflects diversity of backgrounds, skills and experiences
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Proxy access right that is in line with market standards
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Stock ownership and holding guidelines for directors and executive officers
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A robust Code of Ethical Business Conduct that is based on our S.T.E.E.L. Principles
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Annual stockholder engagement
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Best in class compliance commitment
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Regular review of Chief Executive Officer (“CEO”) and senior management succession planning
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Ability of our Board and its committees, at their sole discretion, to hire independent advisors, including counsel, at U. S. Steel’s expense
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LISTENING TO OUR STOCKHOLDERS
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We regularly communicate with our largest investors to discuss our strategy, sustainability and governance practices. In 2023-2024, we engaged with stockholders throughout the year. In addition to meetings conducted by the Investor Relations group, including relating to the strategic alternatives review process, we engaged with institutional investors on our sustainability strategy and talent strategy. Our stockholders provided constructive feedback and were generally supportive of our current governance, sustainability and talent practices.
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4 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 5 |
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What We Do
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Consider results of annual say-on-pay votes when making compensation decisions
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Regularly engage with our stockholders about our executive compensation program
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Align pay and performance
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Cap annual and long-term incentive awards, including when TSR is negative
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Use an independent compensation consultant
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Require significant stock ownership of executive officers
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Use a market based approach (competitive within our peer group) for determining NEO target pay levels
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Require a “double trigger” for change in control severance
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Require recoupment of incentive awards if a restatement of our financials is required, in compliance with the NYSE’s listing standards, and allow for recoupment if an executive engages in serious misconduct in material violation of law or our Code of Ethical Business Conduct, among other circumstances, at the discretion of the Board
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Annually review risks associated with our compensation programs
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What We Don’t Do
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Pay excise tax gross ups for change in control payments
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Guarantee minimum payout of annual or long-term performance awards
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Reprice options
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Allow directors or employees to engage in hedging transactions, short sales or pledging of our common stock
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Allow dividends or dividend equivalents on unearned RSUs or performance shares
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6 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
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Stockholders are being asked to elect thirteen director nominees for a one-year term.
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Board Recommendation:
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| |||
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The Board of Directors recommends a
vote “FOR” the election of each nominee. |
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| | | |
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 7 |
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Director Qualifications Criteria
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In evaluating the qualifications of director nominees, the Corporate Governance & Sustainability Committee considers factors including, but not limited to, the following:
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Independence. Directors should neither have, nor appear to have, a conflict of interest that would impair the director’s ability to represent the interests of all our stakeholders and to fulfill the responsibilities of a director.
Commitment. Directors should be able to contribute the time necessary to be actively involved in the Board and its decision-making and should be able and willing to prepare for and attend Board and committee meetings.
Diversity. In selecting candidates for recommendation or re-election to the Board, the Corporate Governance & Sustainability Committee considers all aspects of a candidate’s qualifications and skills in the context of the needs of U. S. Steel at that point in time.
The goal is to create a Board with a diversity of experience and perspectives, including race, gender, education and background, and areas of expertise.
Accordingly, the Corporate Governance & Sustainability Committee includes, and has any search firm that it engages include, women and minority candidates in the pool from which the committee selects director candidates.
Experience. Directors should be or have been in leadership positions in their field of endeavor and have a record of excellence in that field.
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Integrity. Directors should have a reputation of integrity and be of the highest ethical character.
Judgment. Directors should have the ability to exercise sound business judgment on a large number of matters.
Knowledge. Directors should have a firm understanding of business strategy, corporate governance, board operations and other relevant business matters.
Skills. Directors should be selected so that the Board has an appropriate mix of skills in critical core areas, including, but not limited to:
–
risk oversight,
–
strategic planning,
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operations of a large organization,
–
accounting,
–
compensation,
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finance,
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technology and innovation,
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sustainability,
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government relations, and
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legal.
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8 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 9 |
10 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
|
| |
The Board of Directors recommends a vote
“FOR” the election of each of the following 2024 Director Nominees for a one-year term. |
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Skills & Experience
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Top Level Enterprise/Corporate Leadership
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High Level Financial
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Human Capital Talent
Development and Labor
–
Technology Transformation
–
Risk Management
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Tracy A. Atkinson
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Age: 59
Director Since: 2020
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Committees
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Audit
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Compensation & Organization
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Other Public Company Boards
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Citizens Financial Group
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RTX Corporation (formerly Raytheon Technologies Corporation)
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Affiliated Managers Group Inc.
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| | | |
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| | | |
Experience
Ms. Atkinson served as Executive Vice President of State Street Corporation, a global financial services provider, from 2008 until March 2020 and as its Chief Administrative Officer from May 2019 to March 2020. Prior to that role, Ms. Atkinson served as State Street Corporation’s Chief Compliance Officer from 2017 to May 2019, and its Treasurer from 2016 to 2017. From 2009 to 2010, Ms. Atkinson served as Executive Vice President and Chief Compliance Officer of State Street Corporation, and she served as Executive Vice President and State Street Global Advisors’ Chief Compliance Officer from 2008 to 2009. Prior to joining State Street Corporation in 2008, Ms. Atkinson served in various leadership positions at MFS Investment Management from 2004 to 2008 and as a Partner at PricewaterhouseCoopers from 1999 to 2004, after having joined the firm in 1988. She has served on the board of Citizens Financial Group since 2024, the board of RTX (formerly Raytheon Technologies Corporation) since 2014 and the board of Affiliated Managers Group since 2020. Ms. Atkinson received a bachelor’s degree in accounting from the University of Massachusetts and is a certified public accountant.
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| | | |
Qualifications
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Expertise in public company accounting, risk management, disclosure, financial system management
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Corporate governance and audit expertise gained through service on boards of other large corporations
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UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 11 |
|
Skills & Experience
–
Top Level Enterprise/Corporate Leadership
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Human Capital Talent Development and Labor
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Customer-Centricity and Innovation
–
Technology Transformation
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International Markets
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Environmental and Sustainability
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Risk Management
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Andrea J. Ayers
|
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| | | |
Age: 60
Director Since: 2023
|
| |
Committees
–
Audit
–
Compensation & Organization
|
| | | | |
Other Public Company Boards
–
Stanley Black & Decker, Inc.
–
Endurance International Group Holdings, Inc. (2019-2021)
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|
| ||||||||||||
| | | |
Experience
Ms. Ayers served as President and Chief Executive Officer of Convergys Corporation (now Concentrix Corporation), a global provider of customer experience solutions and technology, from November 2012 through October 2018, and as a director of Convergys from October 2012 through October 2018. From 2008 through 2012, Ms. Ayers served as President of Convergys Customer Management Group, Inc., and from 2010 to 2012, she also served as Chief Operating Officer of Convergys Customer Management Group, Inc. She has served on the board of Stanley Black & Decker, Inc. since 2014 and as Chair of the board since April 2022. Ms. Ayers also served on the board of directors of Endurance International Group Holdings, Inc. from 2019 until it was acquired in 2021. Ms. Ayers received a bachelor’s degree in management and administration from Louisiana State University, Shreveport.
|
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| | | |
Qualifications
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Executive experience managing and overseeing strategic, operational and financial matters for a large, complex enterprise
–
Corporate governance expertise derived from service on boards of other multinational corporations
|
| |
–
Knowledge and insight regarding multi-channel customer experience, customer management analytics and technology
|
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|
Skills & Experience
–
Top Level Enterprise/Corporate Leadership
–
High Level Financial
–
Human Capital Talent Development and Labor
–
Customer-Centricity and Innovation
–
Technology Transformation
–
International Markets
–
Steel/Related Industry
–
Environmental and Sustainability
–
Risk Management
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David B. Burritt
|
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| | | |
Age: 68
Director Since: 2017
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Committees
–
Executive
|
| | | | |
Other Public Company Boards
–
Lockheed Martin Corporation
|
| |||
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| | | |
Experience
Mr. Burritt was appointed President and Chief Executive Officer of United States Steel Corporation in May 2017. At that time, Mr. Burritt was also named to the Company’s Board of Directors. He had been elected President and Chief Operating Officer in February 2017 with executive responsibility for all aspects of the Company’s day-to-day business in the United States and Central Europe. Mr. Burritt joined U. S. Steel in September 2013 to serve as Executive Vice President and Chief Financial Officer with responsibility for all aspects of the Company’s strategic and financial matters. Prior to joining U. S. Steel, Mr. Burritt served as Chief Financial Officer at Caterpillar Inc. Mr. Burritt was born in St. Louis, Missouri. He earned a bachelor’s degree in accounting in 1977 from Bradley University in Peoria, Illinois. Mr. Burritt received a master’s degree in business administration from the University of Illinois in Champaign in 1990. Mr. Burritt serves on the board of directors for Lockheed Martin and the National Safety Council and serves on the Executive Committee of the worldsteel board of directors and is a member of The Business Council.
|
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| | | |
Qualifications
–
Insider’s view of U. S. Steel as a result of his daily management of the Corporation and regular communication with employees, customers and stockholders
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Over four decades of experience in the understanding of complex strategic, financial and operational matters
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| |
–
Expertise in public company accounting, risk management, disclosure, financial system management, manufacturing and commercial operations and business transformation
|
|
12 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
Skills & Experience
–
Top Level Enterprise/Corporate Leadership
–
Human Capital Talent Development and Labor
–
Technology Transformation
–
International Markets
–
Steel or Related Industry
–
Environmental and Sustainability
–
Risk Management
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Alicia J. Davis
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Age: 53
Director Since: 2023
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Committees
–
Audit
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Corporate Governance & Sustainability
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Other Public Company Boards
–
None
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| | | |
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| | | |
Experience
Ms. Davis is Chief Strategy Officer at Lear Corporation, a global automotive supplier of seating and electrical distribution and electronic systems. In this role, Ms. Davis leads the Corporate Strategy group, which helps develop and drive Lear’s global strategy and executes value-enhancing acquisitions, divestitures and strategic investments. From 2018 to 2021, Ms. Davis progressed through a variety of positions at Lear, including Senior Vice President, Strategy and Corporate Development, Senior Vice President, Corporate Development and Investor Relations, and Vice President of Investor Relations. Before joining Lear Corporation, Ms. Davis was on the faculty at the University of Michigan Law School, where she served as a tenured professor, and the Associate Dean for Strategic Initiatives. Ms. Davis continues to teach at the University of Michigan Law School as a Professor from Practice. She also served as an Associate and later Of Counsel at Kirkland & Ellis LLP, Vice President at Raymond James & Associates, and an Analyst at Goldman Sachs. Ms. Davis received a bachelor’s degree in business administration from Florida A&M University, a Juris Doctor from Yale Law School, and an MBA from Harvard Business School.
|
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| | | |
Qualifications
–
Executive experience managing and overseeing strategic matters for a large, complex enterprise
–
Insight and expertise related to the automotive industry, an important customer of U. S. Steel
|
| |
–
Extensive experience in finance, legal and academic roles contribute skills in the areas of corporate governance, capital markets and mergers and acquisitions
|
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Skills & Experience
–
Top Level Enterprise/Corporate Leadership
–
High Level Financial
–
Human Capital Talent Development and Labor
–
Customer-Centricity and Innovation
–
Technology Transformation
–
International Markets
–
Steel/Related Industry
–
Environmental and Sustainability
–
Risk Management
|
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| |
Terry L. Dunlap
|
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| | | |
Age: 64
Director Since: 2022
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| |
Committees
–
Compensation & Organization
–
Corporate Governance & Sustainability
|
| | | | |
Other Public Company Boards
–
Matthews International Corporation
–
Ampco-Pittsburgh Corporation (2019-2022)
–
TimkenSteel Corporation (2015-2021)
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Mr. Dunlap is principal of Sweetwater LLC, a consulting firm with a focus on manufacturing and technology. Previously, he served as Interim Chief Executive Officer and President of TimkenSteel Corporation from 2019 to 2021. Prior thereto, Mr. Dunlap spent 31 years with Allegheny Technologies, where he served as Executive Vice President, Flat-Rolled Products from May 2011 until his retirement in December 2014; President, ATI Allegheny Ludlum from 2002 to 2014; and Group President, ATI Flat-Rolled Products from 2008 to 2011. Mr. Dunlap is a member of the board of directors at Matthews International and previously served on the board of directors of Ampco-Pittsburgh Corporation and TimkenSteel Corporation. He is also a past president of the Indiana University of Pennsylvania Foundation Board. Mr. Dunlap received a Bachelor of Science degree in marketing from Indiana University of Pennsylvania and attended the Loyola University of Chicago MBA program.
|
| ||||||||||||
| | | |
Qualifications
–
Broad and deep knowledge of the steel industry
–
Executive experience managing and overseeing strategic, operational and financial matters for a large, complex enterprise
|
| |
–
Knowledge and insight regarding manufacturing and innovation, safety and labor relations
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 13 |
|
Skills & Experience
–
Top Level Enterprise/Corporate Leadership
–
High Level Financial
–
Human Capital Talent Development and Labor
–
Customer-Centricity and Innovation
–
Technology Transformation
–
International Markets
–
Steel/Related Industry
–
Environmental and Sustainability
–
Risk Management
|
| |
|
| |
John J. Engel
|
| |||||||||
| | | |
Age: 62
Director Since: 2011
|
| |
Committees
–
Corporate Governance & Sustainability (Chair)
|
| |
|
| |
Other Public Company Boards
–
WESCO International, Inc.
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Mr. Engel has served as Chairman, President and Chief Executive Officer of WESCO International, Inc., a leading provider of business-to-business distribution, logistics services and supply chain solutions, since 2011. Previously, at WESCO International, Inc., Mr. Engel served as President and Chief Executive Officer from 2009 to 2011, and Senior Vice President and Chief Operating Officer from 2004 to 2009. Before joining WESCO in 2004, Mr. Engel served as Senior Vice President and General Manager of Gateway, Inc.; Executive Vice President and Senior Vice President of Perkin Elmer, Inc.; and Vice President and General Manager of Allied Signal, Inc. Mr. Engel also held various engineering, manufacturing and general management positions at General Electric Company. Mr. Engel is a member of the Business Roundtable and the Business Council and is a member of the board of directors of the National Association of Manufacturers. Mr. Engel holds a Bachelor of Science degree in mechanical engineering from Villanova University. He received his Master of Business Administration from the University of Rochester.
|
| ||||||||||||
| | | |
Qualifications
–
Executive experience managing and overseeing strategic, operational and financial matters for a large, complex enterprise
–
Extensive experience in global manufacturing and logistics, operational issues, human capital management, and business leadership
|
| |
–
Knowledge of financial system management, public company accounting, disclosure requirements and financial markets
|
|
|
Skills & Experience:
–
Top Level Enterprise/Corporate Leadership
–
High Level Financial
–
Human Capital Talent Development and Labor
–
Steel/Related Industry
–
International Markets
–
Environmental and Sustainability
–
Risk Management
|
| |
|
| |
John V. Faraci
|
| |||||||||
| | | |
Age: 74
Director Since: 2019
|
| |
Committees
–
Compensation & Organization
(Chair)
|
| |
|
| |
Other Public Company Boards
–
Conoco Phillips Company (2015-2022)
–
PPG Industries, Inc. (2012-2022)
–
Carrier Global Corporation (2020-2022)
–
United Technologies Corporation (2005-2020)
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Mr. Faraci served as Chairman and Chief Executive Officer of International Paper from 2003 to 2014. During his 40-year career at International Paper, Mr. Faraci served in a series of financial, planning and management positions, including President and Chief Executive Officer and Chief Financial Officer. He previously served as Executive Chairman of Carrier Global Corporation, a global leader in intelligent climate and energy solutions, from 2020-2021. He is a trustee emeritus of the American Enterprise Institute, and a member of the Council on Foreign Relations. Mr. Faraci graduated from Denison University with a degree in history and economics. He received his Master of Business Administration from the University of Michigan’s Ross School of Business.
|
| ||||||||||||
| | | |
Qualifications
–
Executive experience managing and overseeing strategic, operational and financial matters for a large, complex enterprise
–
Expertise in public company accounting, risk management, disclosure, and financial system management
|
| |
–
Corporate governance and audit expertise gained through service on boards of other large corporations
|
|
14 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
Skills & Experience
–
Top Level Enterprise/ Corporate Leadership
–
High Level Financial
–
Human Capital Talent Development and Labor
–
Technology Transformation
–
Steel/Related Industry
–
International Markets
–
Environmental and Sustainability
–
Risk Management
|
| |
|
| |
Murry S. Gerber
|
| |||||||||
| | | |
Age: 71
Director Since: 2012
|
| |
Committees
–
Audit (Chair)
|
| |
|
| |
Other Public Company Boards
–
BlackRock, Inc.
–
Halliburton Company
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Mr. Gerber served as Executive Chairman of EQT Corporation, an integrated energy production company, from 2010 until May 2011, as its Chairman and CEO from 2000 to 2010, and as President from 1998 to 2010. EQT is among the leading natural gas producers in the USA. Prior to joining EQT, Mr. Gerber served for 20 years with Shell Oil Company as CEO of its energy trading business, as Treasurer of the company and in other technical and management positions as a geologist. Mr. Gerber is a member of the board of trustees of the Pittsburgh Cultural Trust and Augustana College. He is also a member of the boards of BlackRock, Inc. and Halliburton Company. Mr. Gerber holds a bachelor’s degree in geology from Augustana College and a master’s degree in geology from the University of Illinois.
|
| ||||||||||||
| | | |
Qualifications
–
Deep knowledge of the energy industry, an important supplier to and customer of U. S. Steel
–
Executive experience managing and overseeing strategic, operational and financial matters for a large, complex enterprise
|
| |
–
Corporate governance and audit expertise derived from service on boards of other multinational corporations
|
|
|
Skills & Experience
–
Top Level Enterprise/ Corporate Leadership
–
Human Capital Talent Development and Labor
–
Technology Transformation
–
Environmental and Sustainability
–
Risk Management
|
| |
|
| |
Jeh C. Johnson
|
| |||||||||
| | | |
Age: 66
Director Since: 2020
|
| |
Committees
–
Audit
–
Corporate Governance & Sustainability
|
| |
|
| |
Other Public Company Boards
–
Lockheed Martin Corporation
–
Metlife, Inc.
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Secretary Johnson has been a partner in the law firm of Paul, Weiss, Rifkind, Wharton & Garrison LLP since January 2017. Previously, Secretary Johnson served as U.S. Secretary of Homeland Security from December 2013 to January 2017; as General Counsel of the U.S. Department of Defense from 2009 to 2012; as General Counsel of the U.S. Department of the Air Force from 1998 to 2001; and as an Assistant U.S. Attorney in the Southern District of New York from 1988 to 1991. Prior to and between his periods of public service, he was in private practice at Paul, Weiss. Secretary Johnson currently serves on the board of Lockheed Martin Corporation and MetLife, Inc. and as a trustee of Columbia University. Secretary Johnson previously served on the board of PG&E Corporation from May 2017 to March 2018. He graduated from Morehouse College, and received his law degree from Columbia Law School. Secretary Johnson has thirteen honorary degrees.
|
| ||||||||||||
| | | |
Qualifications
–
Extensive experience in legal and government roles contribute skills in the areas of risk management, cybersecurity oversight and public policy
–
Executive experience managing and overseeing strategic, operational and financial matters for a large, complex enterprise
|
| |
–
Corporate governance experience gained through service on boards of other large corporations
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 15 |
|
Skills & Experience
–
Customer-Centricity and Innovation
–
Technology Transformation
–
International Markets
–
Steel/Related Industry
–
Environmental and Sustainability
|
| |
|
| |
Paul A. Mascarenas
|
| |||||||||
| | | |
Age: 62
Director Since: 2016
|
| |
Committees
–
Corporate Governance & Sustainability
|
| |
|
| |
Other Public Company Boards
–
ON Semiconductor Corp.
–
The Shyft Group
–
Borg Warner Inc. (2018-2022)
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Mr. Mascarenas served as President and Chairman of the Executive Board of FISITA (Fédération Internationale des Sociétés d’Ingénieurs des Techniques de l’Automobile) from 2014 to 2016. Previously, Mr. Mascarenas worked for 32 years at Ford Motor Company, holding various development and engineering positions, and most recently serving as Chief Technical Officer and Vice President, leading Ford’s worldwide research organization. Mr. Mascarenas is a fellow of the Institution of Mechanical Engineers, and a fellow of the Society of Automotive Engineers. He served as general chairperson for the 2010 SAE World Congress and Convergence and has served on the FISITA board since 2012. Mr. Mascarenas also currently serves on the board of directors at ON Semiconductor Corp. and The Shyft Group, and is a Venture Partner with Fontinalis Partners. Mr. Mascarenas previously served on the board of Borg Warner Inc. from 2018 to 2022. In 2015, he was awarded an Order of the British Empire (OBE) by Her Majesty, Queen Elizabeth II, for his services to the automotive industry. Mr. Mascarenas received a degree in mechanical engineering from University of London, King’s College in England and in June 2013, received an honorary doctorate degree from Chongqing University in China.
|
| ||||||||||||
| | | |
Qualifications
–
Extensive experience in product development, program management and business leadership, as well as experience working in an international forum
|
| |
–
Insight and expertise related to the automotive industry, an important customer of U. S. Steel
–
Knowledge of complex financial and operational issues
|
|
|
Skills & Experience
–
Top Level Enterprise/Corporate Leadership
–
High Level Financial
–
Human Capital Talent Development and Labor
–
Customer-Centricity and Innovation
–
Technology Transformation
–
International Markets
–
Environmental and Sustainability
–
Risk Management
|
| |
|
| |
Michael H. McGarry
|
| |||||||||
| | | |
Age: 66
Director Since: 2019
|
| |
Committees
–
Audit
–
Compensation & Organization
|
| |
|
| |
Other Public Company Boards*
–
Shin Etsu Chemical Co., Ltd.
–
PPG Industries, Inc. (2015-2023)
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Mr. McGarry is the former Executive Chairman of PPG Industries, Inc., a manufacturer and distributor of paints, coatings and specialty materials, a position he held from 2022 to 2023. He served as Chairman and Chief Executive Officer from 2016 through 2022. From 1981 to 2004, Mr. McGarry progressed through a variety of management positions at PPG, including Market Development Manager, silica products; Operations Manager, silicas; Business Manager, TESLIN® sheet; Product Manager in the derivatives, chlorine, liquid and dry caustic soda businesses; and General Manager, fine chemicals. He was appointed Vice President, chlor-alkali and derivatives in 2004; then Vice President, coatings, Europe, and managing director, PPG Europe in 2006; and Senior Vice President of the Commodity Chemicals reporting segment in 2008. In 2012, he was elected Executive Vice President and then Chief Operating Officer in 2014. Mr. McGarry became President and Chief Operating Officer in March 2015, joined PPG’s board of directors in July 2015 and was elected President and CEO in September 2015. Mr. McGarry also currently serves on the board of Shin Etsu Chemical Co., Ltd.. Mr. McGarry graduated from the University of Texas at Austin with a Bachelor of Science degree in mechanical engineering and completed the Advanced Management Program at Harvard Business School.
|
| ||||||||||||
| | | |
Qualifications
–
Executive experience managing and overseeing strategic, operational and financial matters for a large, complex enterprise
–
Expertise in public company accounting, risk management, disclosure, financial system management
|
| |
–
Extensive experience in global manufacturing and logistics, operational issues, and business leadership
|
| |||||||||
| | | |
|
| |
* Has been nominated for election to the board of directors of C. H. Robinson.
|
|
16 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
Skills & Experience
–
Top Level Enterprise/Corporate Leadership
–
High Level Financial
–
Human Capital Talent Development and Labor
–
Customer-Centricity and Innovation
–
Steel/Related Industry
–
Environmental and Sustainability
–
Risk Management
|
| |
|
| |
David S. Sutherland (Independent Board Chair)
|
| |||||||||
| | | |
Age: 74
Director Since: 2008
|
| |
Committees
–
Executive
|
| |
|
| |
Other Public Company Boards
–
GATX Corporation
–
Imperial Oil, Ltd. (2010-2023)
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Mr. Sutherland serves as the Corporation’s Independent Board Chair. He retired as President and Chief Executive Officer of the former IPSCO, Inc., a leading North American steel producer, in July 2007 after spending 30 years with the company and more than five years as President and Chief Executive Officer. Mr. Sutherland is a former chairman of the American Iron and Steel Institute and served as a member of the boards of directors of the Steel Manufacturers Association, the International Iron and Steel Institute, the Canadian Steel Producers Association and the National Association of Manufacturers. Mr. Sutherland earned a Bachelor of Commerce degree from the University of Saskatchewan and a Master of Business Administration from the University of Pittsburgh’s Katz Graduate School of Business.
|
| ||||||||||||
| | | |
Qualifications
–
Broad and deep knowledge of the steel industry
–
Executive experience managing and overseeing strategic, operational and financial matters for a large, complex enterprise
|
| |
–
Corporate governance and audit expertise derived from service on boards of other multinational corporations
|
|
|
Skills & Experience
–
Top Level Enterprise/Corporate Leadership
–
Human Capital Talent Development and Labor
–
Customer-Centricity and Innovation
–
Technology Transformation
–
Environmental and Sustainability
–
Risk Management
|
| |
|
| |
Patricia A. Tracey
|
| |||||||||
| | | |
Age: 73
Director Since: 2007
|
| |
Committees
–
Audit
–
Corporate Governance & Sustainability
|
| |
|
| |
Other Public Company Boards
–
None
|
| |||
| | | |
|
| ||||||||||||
| | | |
Experience
Vice Admiral Tracey retired as Vice President, Homeland Security and Defense Services for HP Enterprise Services in October 2016. She worked with Hewlett Packard Co. in increasingly responsible roles until her retirement, and previously was a Client Industry Executive for business development and performance improvement with Electronic Data System Corporation, which was acquired by Hewlett Packard Co. in August 2008. From 1970 to 2004, Vice Admiral Tracey served in increasingly responsible operational and staff positions with the United States Navy, including Chief of Naval Education and Training from 1996 to 1998, Deputy Assistant Secretary of Defense (Military Personnel Policy) from 1998 to 2001, and Director, Navy Headquarters Staff from 2001 to 2004. Vice Admiral Tracey served as a consultant on decision governance processes to the United States Navy from 2004 to 2005 and to the Department of Defense from 2005 to 2006. She currently advises business owners pursuing opportunities with the U.S. Government. She also serves on the board of trustees of Norwich University and the board of directors of the Armed Forces Benefits Association. Vice Admiral Tracey holds a Bachelor of Arts degree in Mathematics from the College of New Rochelle and a Master of Science in Operations Research and Systems Analysis from the Naval Postgraduate School.
|
| ||||||||||||
| | | |
Qualifications
–
Senior executive leadership experience over a 34-year career in the U.S. military
–
Deep experience in government affairs, planning and executing large scale organization and workforce transformation strategies, occupational safety and environmental compliance, and governance
|
| |
–
Insight regarding information technology and cybersecurity gained from overseeing implementation of advanced solutions for Department of Defense and Homeland Security agencies
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 17 |
|
U. S. Steel is committed to maintaining the highest standards of corporate governance and ethical conduct, which we believe are essential for sustained success and long-term stockholder value. In light of this goal, the Board oversees, counsels and directs management in the long-term interests of U. S. Steel, its stockholders and its customers. Our governance framework gives our highly-experienced directors the structure necessary to provide oversight, advice and counsel to U. S. Steel. The Board’s responsibilities include:
|
| |||
|
–
overseeing the management of our business and the assessment of our business risks;
–
overseeing the processes for maintaining the integrity of our financial statements and other public disclosures, and compliance with laws and ethical principles;
–
reviewing and approving our major financial objectives and strategic and operating plans;
|
| |
–
overseeing our sustainability, human capital management and succession planning for the CEO and other key executives; and
–
establishing an effective governance structure, including appropriate board composition and planning for board succession.
|
|
18 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
CORPORATE GOVERNANCE MATERIALS
|
| |||
|
The following materials are available on our website, www.ussteel.com
–
Corporate Governance Principles
–
By-laws
–
Board Committee Charters
–
Code of Ethical Business Conduct
|
| |
These materials are also available in print to any person, without charge, upon written request to:
Corporate Secretary
United States Steel Corporation 600 Grant Street, Suite 1884 Pittsburgh, PA 15219 |
|
|
Leadership Structure
|
| |
–
Our Board Chair is independent and interacts closely with our CEO
–
The independent Board members elect our Board Chair annually. Among other duties, our Board Chair leads executive sessions of the independent directors to discuss certain matters without management present
|
|
|
Board
Composition |
| |
–
The Board regularly assesses its performance through annual Board and committee self-evaluations
–
The Corporate Governance & Sustainability Committee periodically updates the board skills analysis to ensure the Board composition is aligned with U. S. Steel’s strategic needs
|
|
|
Board Independence
|
| |
–
12 out of 13 of our nominees are independent
–
Our CEO is the only employee director
|
|
|
Board Committees
|
| |
–
We have four Board committees — Executive, Audit, Corporate Governance & Sustainability, and Compensation & Organization
–
With the exception of the Executive Committee (composed of our Board Chair and CEO), all other committees are composed entirely of independent directors
|
|
|
Management Succession Planning
|
| |
–
The Board actively monitors succession planning and talent development and receives regular updates on employee engagement, inclusion and diversity, and retention matters
–
The Board regularly reviews senior management succession and development plans
|
|
|
Director Stock Ownership
|
| |
–
Our directors are required to receive more than half of their annual retainer in shares of our common stock, which will either vest after one year or are deferred until retirement, at the election of the director, and are subject to robust ownership requirements
|
|
|
Risk Oversight
|
| |
–
Our full Board is responsible for risk oversight, and has designated committees to have particular oversight of certain key risks, including sustainability/climate-related risks and cybersecurity risks
–
Our Board oversees management as management fulfills its responsibilities for the assessment and mitigation of risks and for taking appropriate risks
|
|
|
Accountability to Stockholders
|
| |
–
We use majority voting in uncontested director elections with a director resignation policy
–
We have annual elections of directors
–
We implemented a proxy access by-law provision in line with market standards, which enables certain of our stockholders to nominate directors and have their eligible nominees included in the proxy statement with our nominees
–
We actively and routinely reach out to our stockholders through our engagement program
–
Stockholders can contact our Board, our Board Chair or management by mail
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 19 |
|
Creating Long-term Stockholder Value
|
| |||
|
The primary goal of our capital allocation strategy is to create long-term stockholder value driven by four priorities for cash:
–
maintaining balance sheet strength that supports the Corporation’s strategic objectives;
–
investing in new, less capital intensive technologies that are less carbon intensive to support sustainable innovation to achieve our Best for All® strategy;
–
reinvesting in our current assets to advance operational excellence to deliver high-quality products and service to our customers; and
–
returning cash to stockholders.
|
|
|
STEP 1
|
| |
STEP 2
|
|
|
–
Our full Board reviews senior management succession
and development plans with our CEO
|
| |
–
Our CEO then presents to the independent directors his evaluations and recommendation of future candidates for the CEO position and other senior leadership roles and potential succession timing for those positions, including under emergency circumstances
|
|
20 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
Director Visits to U. S. Steel Facilities
|
|
|
The Board also believes that visits to facilities enable it to observe the Corporation’s culture first-hand. In 2023, our directors visited our Research and Technology Center in Munhall, Pennsylvania, and several visited other facilities across our footprint, including Big River Steel and Mon Valley Works. These experiences enable the Board to demonstrate and observe U. S. Steel’s culture of caring and prioritization of safety, and evaluate whether the Corporation is adopting business practices that create the engaged and stable workforce needed to achieve its long-term strategy.
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 21 |
22 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
Lead Director Duties:
|
| |||
|
–
Chair executive sessions of the non-employee directors
–
Serve as a liaison between the CEO and the independent directors
–
Approve Board meeting agendas and, in consultation with the CEO and the independent directors, approve Board meeting schedules to ensure there is sufficient time for discussion of all agenda items
|
| |
–
Approve the type of information to be provided to directors for Board meetings
–
Be available for consultation and direct communication with our stockholders
–
Call meetings of the independent directors when necessary and appropriate
–
Perform other duties as the Board may designate
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 23 |
STEP 1
Questionnaire
|
| |
STEP 2
Board Assessment
|
| |
STEP 3
Individual Interviews
|
| |
STEP 4
Evaluation Results
|
| |
Step 5
Follow up Actions
|
|
Directors respond to a wide range of questions related to topics including Board operations and composition, satisfaction of responsibilities, Board and management dynamics and accessibility of resources. Open-ended questions are also included to identify key strengths and areas for improvements of the Board.
|
| |
The Board evaluation includes an assessment of whether the Board has the appropriate mix of skills, experience and other characteristics, and is made up of a sufficiently diverse group of people.
|
| |
The Board Chair and Committee Chairs conduct individual interviews with each director to discuss Board, and committee and performance and effectiveness.
|
| |
Results of the evaluations are discussed by the full Board, and each committee, respectively.
|
| |
Feedback from this evaluation process is used to make any necessary changes to Board practices, composition, size and other matters.
|
|
24 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
Director
|
| |
Audit
Committee |
| |
Compensation &
Organization Committee |
| |
Corporate
Governance & Sustainability Committee |
| |
Executive
Committee |
|
|
Tracy A. Atkinson
|
| |
■
|
| |
■
|
| | | | | | |
|
Andrea J. Ayers
|
| |
■
|
| |
■
|
| | | | | | |
| David B. Burritt | | | | | | | | | | | |
■
|
|
|
Alicia J. Davis
|
| |
■
|
| | | | |
■
|
| | | |
|
Terry L. Dunlap
|
| | | | |
■
|
| |
■
|
| | | |
|
John J. Engel
|
| | | | | | | |
■
|
| | | |
| John V. Faraci | | | | | |
■
|
| | | | | | |
|
Murry S. Gerber
|
| |
■
|
| | | | | | | | | |
|
Jeh C. Johnson
|
| |
■
|
| | | | |
■
|
| | | |
| Paul A. Mascarenas | | | | | | | | |
■
|
| | | |
|
Michael H. McGarry
|
| |
■
|
| |
■
|
| | | | | | |
|
David S. Sutherland
(Independent Board Chair) |
| | | | | | | | | | |
■
|
|
|
Patricia A. Tracey
|
| |
■
|
| | | | |
■
|
| | | |
| TOTAL MEETINGS HELD IN 2023: | | |
4
|
| |
7
|
| |
5
|
| | | |
|
Chair:
Murry S. Gerber*
Members:
Tracy A. Atkinson* Andrea J. Ayers Alicia J. Davis Jeh C. Johnson Michael H. McGarry* Patricia A. Tracey All members are “financially literate.”
*
These three directors meet the SEC’s definition of an “audit committee financial expert.”
No member of the Audit Committee serves on the audit committees of more than two other publicly traded companies.
|
| |
|
| |
AUDIT
|
|
| | |
Duties and Responsibilities
–
Review and discuss with management and the independent registered public accounting firm matters related to the annual audited financial statements, quarterly unaudited financial statements, earnings press releases and the accounting principles and policies applied;
–
Review and discuss with management and the independent registered public accounting firm matters related to the Corporation’s internal controls over financial reporting;
–
Review the responsibilities, staffing and performance of the Corporation’s internal audit function;
–
Review issues regarding the Corporation’s compliance with legal or regulatory requirements and corporate policies dealing with business conduct;
–
Appoint (subject to stockholder ratification), compensate, retain, and oversee the work of the Corporation’s independent registered public accounting firm. The committee has the sole authority to approve all audit engagement fees and terms as well as all non-audit engagements with the firm; and
–
Discuss policies regarding risk assessment and risk management, including overseeing cybersecurity risks.
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 25 |
|
Chair:
John V. Faraci*
Members:
Tracy A. Atkinson
Andrea J. Ayers Terry L. Dunlap Michael H. McGarry The Compensation Committee meets in executive session without management for a portion of each regular meeting.
|
| |
|
| |
COMPENSATION & ORGANIZATION
|
|
| | |
Duties and Responsibilities
–
Review and approve the Corporation’s overall compensation philosophy and related compensation and benefit programs, policies and practices;
–
Recommend the CEO’s compensation to the independent directors based on the evaluation of the CEO’s performance;
–
Determine and approve, with input from the CEO, the compensation of the Corporation’s executive officers;
–
Assess whether the Corporation’s compensation policies and practices could be reasonably likely to create a risk that could have a material adverse effect on the Corporation;
–
Assess the independence of the Corporation’s executive compensation consultant;
–
Consider the most recent stockholder advisory vote on executive compensation; and
–
Review and discuss with management the Corporation’s human capital management strategies, including in the areas of diversity, equity and inclusion, culture and employee engagement and pay equity.
The Compensation Committee retains Pay Governance, LLC as its independent executive compensation consultant. A representative of Pay Governance attended all meetings of the Compensation Committee in 2023.
|
|
|
Chair:
John J. Engel
Members:
Alicia J. Davis
Terry L. Dunlap Jeh C. Johnson Paul A. Mascarenas Patricia A. Tracey The Committee has the sole authority to retain and terminate any search firm used to identify director candidates, including sole authority to approve the search firm’s fees and other retention terms.
|
| |
|
| |
CORPORATE GOVERNANCE & SUSTAINABILITY
|
|
| | |
Duties and Responsibilities
–
Identify, evaluate and recommend nominees for the Board, consistent with the Corporate Governance Principles, including determining and monitoring whether or not each director and prospective director is “independent” within the meaning of any rules and laws applicable to the Corporation;
–
Make recommendations to the Board concerning the appropriate size, composition and leadership of the Board and its committees;
–
Make recommendations to the Board concerning the compensation of non-employee directors;
–
Recommend to the Board a set of corporate governance principles for the Corporation and annually review and recommend appropriate changes to the Board;
–
Review and discuss risk matters relating to legislative, regulatory and public policy issues affecting the Corporation’s businesses and operations;
–
Review public policy issues likely to be of interest to various stakeholders of the Corporation, including employee health and safety, environmental, energy and trade matters;
–
Establish, review and approve changes to the Corporation’s codes of conduct applicable to the Corporation’s employees and directors; and
–
Assist the Board in fulfilling its oversight responsibilities for sustainability matters, including greenhouse gas emissions and other climate-related matters, sustainable use and management of natural resources (such as air, water, land and minerals), and corporate social responsibility, including the Corporation’s record of compliance with related laws and regulations.
|
|
26 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
This page provides highlights of our sustainability efforts. For more information, please visit our ESG Data Hub on our website at https://www.ussteel.com/sustainability/esg-data-hub, where you will find the following documents among others:
|
| |||
|
–
ESG Report
–
GRI/SASB Index
–
DE&I Report
–
Climate Strategy Report
–
TCFD Report
|
| |
–
Corporate Governance Principles
–
By-Laws
–
Audit Committee Charter
–
Compensation & Organization Committee Charter
–
Corporate Governance & Sustainability Charter
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 27 |
28 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
Topic
|
| |
What We Heard From Our Stockholders
|
| |
Actions in Response to Stockholder Feedback
|
|
Sustainability
|
| |
Encouraged by our increased and enhanced sustainability disclosure and GHG reduction goals
|
| |
–
Released inaugural TCFD Report and published a “Roadmap to 2050” on our website in 2021 and a Climate Strategy Report in 2022; updated TCFD Report released in 2023
–
Inaugural Sustainability Report issued in 2019 with enhanced reports released each year thereafter
–
Announced 20% GHG Emissions Intensity Reduction Goal by 2030, compared to a 2018 baseline, and net-zero by 2050 ambition
|
|
Talent Strategy
|
| |
Comprehensive inclusive benefits provide helpful insight into U. S. Steel’s culture of inclusion
|
| |
–
Inaugural Diversity, Equity and Inclusion Report published in 2022, including disclosure of EEO-1 Report, published in 2023
|
|
Executive Compensation
|
| |
Continue to align executive compensation with company performance
|
| |
–
Ongoing benchmarking of compensation practices to our peers
See page 41 for more on enhancements to our executive compensation program
|
|
Governance
|
| |
Positive feedback regarding transparency of governance program
|
| |
–
Proactive board refreshment that includes a focus on diversity
–
Enhanced disclosure regarding Board diversity and skills
–
Proactively adopted proxy access in 2016
–
Annual website disclosure regarding political contributions
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 29 |
30 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
Name
|
| |
Fees Earned
or Paid in Cash(1) ($) |
| |
Stock
Awards(2)(3) ($) |
| |
Other
Compensation(4) |
| |
Total
($) |
|
Tracy A. Atkinson
|
| |
135,000
|
| |
165,013
|
| | | | |
300,013
|
|
Andrea J. Ayers
|
| |
0
|
| |
400,016
|
| |
31,220
|
| |
431,236
|
|
Alicia J. Davis
|
| |
112,500
|
| |
192,528
|
| |
22,390
|
| |
327,418
|
|
Terry L. Dunlap
|
| |
100,000
|
| |
210,003
|
| | | | |
310,003
|
|
John J. Engel
|
| |
144,000
|
| |
176,035
|
| | | | |
320,035
|
|
John V. Faraci
|
| |
144,000
|
| |
176,059
|
| | | | |
320,059
|
|
Murry S. Gerber
|
| |
144,000
|
| |
176,035
|
| | | | |
320,035
|
|
Jeh C. Johnson
|
| |
0
|
| |
300,008
|
| | | | |
300,008
|
|
Paul A. Mascarenas
|
| |
120,000
|
| |
180,010
|
| | | | |
300,010
|
|
Michael H. McGarry
|
| |
135,000
|
| |
165,013
|
| | | | |
300,013
|
|
David S. Sutherland
|
| |
0
|
| |
450,025
|
| | | | |
450,025
|
|
Patricia A. Tracey
|
| |
135,000
|
| |
165,013
|
| | | | |
300,013
|
|
Name
|
| |
Restricted Stock
Units |
| |
Deferred Stock
Units |
|
Tracy A. Atkinson
|
| |
0
|
| |
6,767
|
|
Andrea J. Ayers
|
| |
0
|
| |
12,303
|
|
Alicia J. Davis
|
| |
7,704
|
| |
0
|
|
Terry L. Dunlap
|
| |
8,612
|
| |
0
|
|
John J. Engel
|
| |
0
|
| |
7,219
|
|
John V. Faraci
|
| |
3,610
|
| |
3,610
|
|
Murry S. Gerber
|
| |
7,219
|
| |
0
|
|
Jeh C. Johnson
|
| |
0
|
| |
12,303
|
|
Paul A. Mascarenas
|
| |
3,691
|
| |
3,691
|
|
Michael H. McGarry
|
| |
0
|
| |
6,767
|
|
David S. Sutherland
|
| |
0
|
| |
18,455
|
|
Patricia A. Tracey
|
| |
6,767
|
| |
0
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 31 |
|
For purposes of this policy, related persons include:
|
| |||
|
–
any person who is, or at any time since the beginning of the Corporation’s last fiscal year was, a director or executive officer of the Corporation or a nominee to become a director of the Corporation;
|
| |
–
any person who is the beneficial owner of more than 5% of any class of the Corporation’s voting securities; and
–
any immediate family member of any person described above.
|
|
|
The standards applied by the Corporate Governance & Sustainability Committee when reviewing transactions with related persons include:
|
| |||
|
–
the benefits to the Corporation of the transaction;
–
the terms and conditions of the transaction and whether these terms and conditions are comparable to the terms available to or from an unrelated third party or employees generally; and
|
| |
–
the potential for the transaction to affect the independence or judgment of a director or executive officer of the Corporation.
|
|
|
The transactions that are automatically pre-approved include:
|
| |||
|
–
transactions involving compensation to directors and executive officers of the type that is required to be reported in the Corporation’s proxy statement;
–
indebtedness for ordinary business travel and expense payments;
–
transactions with another company at which a related person’s only relationship is as an employee (other than an executive officer), a director or beneficial owner of less than 10% of any class of equity securities of that company, provided that the amount involved does not exceed the greater of $1,000,000 or 2% of that company’s consolidated gross annual revenues;
–
transactions where the interest of the related person arises solely from the ownership of a class of equity securities of the Corporation, and all holders of that class of equity securities receive the same benefit on a pro rata basis;
|
| |
–
transactions where the rates or charges involved are determined by competitive bid;
–
transactions involving the rendering of services as a common or contract carrier or public utility at rates or charges fixed in conformity with law or governmental regulation; and
–
transactions involving services as a bank depositary of funds, transfer agent, registrar, trustee under a trust indenture or similar services.
|
|
|
There were no transactions that required approval of the Corporate Governance & Sustainability Committee under this policy during 2023.
|
|
32 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 33 |
|
INFORMATION ABOUT THIS PROPOSAL
Stockholders are being asked to approve, on an advisory basis, the 2023 compensation of our five named executive officers as described in the Compensation Discussion & Analysis and the Executive Compensation Tables.
|
|
|
|
| |
The Board of Directors recommends a
vote “FOR” the resolution approving the compensation of our Named Executive Officers. |
|
|
|
| | | |
34 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
| | | |
John V. Faraci, Committee Chair
|
| | Terry L. Dunlap | |
| | | | Tracy A. Atkinson | | | Michael H. McGarry | |
| | | | Andrea J. Ayers | | | | |
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 35 |
|
|
| |
David B. Burritt
President & Chief Executive Officer |
| |
|
| |
Jessica T. Graziano
Senior Vice President & Chief Financial Officer |
|
|
|
| |
James E. Bruno
Senior Vice President, Global Information Technology & President USSE |
| |
|
| |
Scott D. Buckiso
Senior Vice President & Chief Manufacturing Officer, North American Flat-Rolled (NAFR) |
|
|
|
| |
Duane D. Holloway
Senior Vice President, General Counsel and Chief Ethics & Compliance Officer |
| | | | |
|
Contents
|
|
|
To assist stockholders in finding important information in the Compensation Discussion and Analysis, we’re providing this highlighted page summary.
|
|
| Our 2023 Performance Highlights | | | |
|
| | | | | |
|
2023 Executive Compensation Program Overview
|
| | | | 38 | | | | | |
| 2023 Compensation Decisions | | | | | 39 | | | | | |
| Compensation Governance Practices | | | | | 40 | | | | | |
| Stockholder Feedback and Say-on-Pay Vote | | | | | 41 | | | | | |
|
Our Compensation Philosophy
|
| | |
|
| | |
|
| |
| | | | | | | | | |
|
|
|
Financial Performance
Delivering Long-Term Value to our Stockholders
Execution of our strategy yielded
strong financial results, driven by consistent and reliable operations. |
| |
2023 FINANCIAL PERFORMANCE
|
| |||
| $2.139B | | | 96% | | |||
| Adjusted EBITDA | | | Total Shareholder Return | | |||
| 13% | | | 19 days | | |||
|
Return on Capital
Employed |
| | Cash Conversion Cycle | |
|
Focus on Customer Success
|
| |||
|
Driving Revenues
Through our Best for All customer-centric strategy, U. S. Steel continues to deliver
for our customers with high quality and reliability performance. |
| |
–
Progressed on high return strategic projects, which remain on time, to provide the innovative products our customers seek
–
Commissioned our new NGO electrical steel line. The key product that will be produced on the line, InduX™, positions U. S. Steel as a crucial supplier for the industrial and electric vehicle markets, as no electric vehicle, motor, or generator today is operational without the steel grades needed to transform electrical power into usable energy.
|
|
|
Employees
|
| |||
|
Fostering Performance-Based
Culture
In 2023, we continued to reward strong performance and promote inclusion and accountability with our employees.
|
| |
–
Achieving record safety performance, with 0.04 days away from work, significantly outperforming industry average
–
Rewarding employees with sizeable profit sharing and incentives
–
Leveraging flexible work from anywhere policies to build corporate culture and engagement and attract and retain diverse and inclusive talent
0.04 Days
All-time best days away
from work (DAFW) |
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 37 |
|
Element
|
| |
Overview and Key Performance Metrics
|
| |
Purpose
|
| |||
|
FIXED
|
| |||||||||
|
Base Salary
|
| |
Fixed cash baseline compensation takes into account the scope and complexity of the NEO’s role, individual qualifications and experiences, and internal value to the Corporation.
|
| |
Base salaries are set at market competitive levels to attract and retain highly qualified executives to lead and implement our strategy.
|
| |||
|
VARIABLE
|
| |||||||||
|
Annual Incentive Compensation
Plan (AICP)
Payout Range:
0%-230% of target for corporate and individual performance
|
| |
Financial Metrics
EBITDA (75%)
A financial performance measure intended to focus the organization on driving sustained profitability.
Cash Conversion Cycle (CCC) (25%)
A financial liquidity measure intended to focus the organization on efficiently managing cash to maintain the Corporation’s industry leading performance.
|
| |
Performance-based annual cash incentive opportunities support achieving profitability and efficiency goals that are crucial to our strategic plan.
|
| |||
|
Individual Performance Assessments Impact AICP Payout
(-15% to +30%)
In addition to their role in achieving enterprise financial goals, named executive officers are evaluated on their individual performance in four key performance categories:
–
Safety;
–
Strategy Execution;
–
Advancing Critical Success Factors; and
–
Leadership.
|
| |
Executive officers may earn up to an additional 30% of their target award (or have their award reduced) based on their individual performance.
Recognizes executives for their individual contribution to attaining our annual strategic, operational and corporate results.
|
| ||||||
|
Long-Term Incentive
Program (LTIP)
Payout Range:
0%-200% of target for corporate performance
|
| |
Corporate Performance Metrics (64% of LTIP for the CEO and 60% for the other NEOs)
Relative Total Shareholder Return (TSR) (50%)
TSR performance awards are based on relative performance, with the payout determined based on the rank of U. S. Steel’s TSR compared to the TSR of its peer group companies over the three-year performance period, as well as for each year within the performance period.
Awards vest after the three-year performance period if TSR performance metrics for each year and over the three-year performance period are achieved.
Return On Capital Employed (ROCE) (50%)
ROCE performance awards are based on rigorous performance targets approved at the time of grant over the three-year performance period, as well as for each year within the performance period.
Awards vest after the three-year performance period if ROCE performance metrics for each year and over the three-year performance period are achieved.
|
| |
Variable long-term performance-based compensation motivates and rewards executives for achieving multi-year strategic priorities.
|
| |||
|
Time-Based Restricted Stock Units (RSUs) (36% of LTIP for the CEO and 40% for the other NEOs)
RSUs provide the best retention benefits among our long-term incentives, especially during times of challenging economic and industry conditions.
Awarding RSUs facilitates stock ownership and executive retention, and promotes stockholder alignment.
RSUs vest ratably over three years.
|
| |
RSUs support retention of highly qualified executives to lead and implement our strategy. They align with stockholder interests as the value fluctuates with stock price performance.
|
|
38 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
NEO
|
| |
2023 Base
Salary ($) |
| |
2023
AICP Award(1)($) |
| |
2023
LTIP Award Grants(2)($) |
| |
Total(3)
($) |
|
|
Burritt
|
| |
1,400,000
|
| |
4,284,000
|
| |
10,500,000
|
| |
16,184,000
|
|
|
Graziano
|
| |
737,500
|
| |
1,504,500
|
| |
2,750,000
|
| |
4,992,000
|
|
|
Bruno
|
| |
691,250
|
| |
1,278,813
|
| |
1,600,000
|
| |
3,570,063
|
|
|
Buckiso
|
| |
691,250
|
| |
1,500,013
|
| |
1,600,000
|
| |
3,791,263
|
|
|
Holloway
|
| |
691,250
|
| |
1,198,628
|
| |
1,600,000
|
| |
3,489,878
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 39 |
|
|
| |
What We Do
|
|
|
–
Consider results of annual say-on-pay votes when making compensation decisions
–
Regularly engage with our stockholders about our executive compensation program
–
Align pay and performance
–
Cap annual and long-term incentive awards, including when TSR is negative
–
Use an independent compensation consultant
–
Require significant stock ownership of executive officers
–
Use a market-based approach (competitive within our peer group) for determining NEO target pay levels
–
Require a “double trigger” for change in control severance
–
Require recoupment of incentive awards if a restatement of our financials is required, in compliance with the NYSE’s listing standards, and allow for recoupment if an executive engages in serious misconduct in material violation of law or our Code of Ethical Business Conduct, among other circumstances, at the discretion of the Board (absent a restatement)
–
Annually review risks associated with our compensation programs
|
|
|
|
| |
What We Don’t Do
|
|
|
–
Pay excise tax gross ups for change in control payments
–
Guarantee minimum payout of annual or long-term performance awards
–
Reprice options
–
Allow directors or employees to engage in hedging transactions, short sales or pledging of our common stock
–
Allow dividends or dividend equivalents on unearned RSUs or performance shares
|
|
40 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
Actions Taken
|
| | | | |
Goal
|
|
|
Included ESG metrics into long-term performance-based compensation
|
| |
|
| |
Reward executives if transformational strategic objectives, including greenhouse gas emissions reductions, of the Best for All® strategy are completed
|
|
|
Expanded clawback provision for executive compensation
Policy was further updated in 2023 to comply with new SEC rules
|
| |
|
| |
Provide accountability for executive officers in the event of intentional or reckless serious misconduct and recover excess incentive compensation in the event of an accounting restatement
|
|
|
Enhanced disclosure on individual performance
|
| |
|
| |
Provide more transparency around how executives’ performance is judged, including how safety factors into our executive compensation program
|
|
|
Revised the AICP formula to enable partial payout of incentive award based on superior individual performance
|
| |
|
| |
Ensure highly qualified executives are motivated even in periods of market decline, given cyclicality of the business
|
|
|
Eliminated use of stock options, as part of the annual awards
|
| |
|
| |
Reduce volatility in executive compensation payouts and respond to stockholders’ disfavor of options
|
|
|
Revised TSR and ROCE calculations to include components of TSR or ROCE for each year in the performance period while maintaining the largest weighting on three-year TSR or ROCE performance
|
| |
|
| |
Provide better alignment to stockholder experience, by reducing extremes in vesting and increasing data points used in the calculation, given high volatility in stock price performance
|
|
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 41 |
| | ||||||
|
| |
Strong Pay-for-Performance Approach
|
| |
–
Majority of target compensation opportunity is performance- and/or stock-based
–
Our compensation programs are focused on objective corporate performance measures and individual performance
|
|
|
| |
Align Pay with Long-Term Interests of our Stockholders
|
| |
–
Equity comprises the largest portion of an executive’s compensation, a substantial portion of which is performance-based
–
Executives are subject to rigorous stock ownership and holding requirements
|
|
|
| |
Support our Strategic and Financial Goals
|
| |
–
Balance of compensation elements that focus on both short-term and long-term corporate performance and goals that align with our annual and long-term strategic objectives
|
|
|
| |
Attract, Reward and Retain Executives
|
| |
–
Our long-term incentive grants include restricted stock units that may retain some value in a period of stock market decline
–
Executive compensation is targeted to be competitive with and aligned to the median of our peer group
|
|
Date
|
| |
Compensation Element
|
|
Determined January 2023
|
| |
Base Salary and Annual/Long-Term Incentive Program Target Grant Values
–
Base salaries and target grant values under the AICP and LTIP were determined in January 2023 based on market competitive total target compensation package.
–
Annual and long-term corporate performance targets for 2023 grants were decided based on, in part, market conditions at the time.
|
|
Determined after 2023 Year-end
Paid March 2024* |
| |
Annual Incentive Awards
–
AICP awards reported for 2023 were determined after 2023 year-end based on 2023 corporate and individual performance and were paid in March 2024.
|
|
Certified after 2023 Year-end Payouts for 2023 awards reported in March 2024*
|
| |
Long-Term Incentive Awards
–
Performance for 2021-2023 LTIP awards was certified after 2023 year-end and vested, as applicable, in February 2024.
–
Interim performance criteria for 2022 and 2023 TSR and ROCE performance awards were certified in February 2024; awards do not vest until the applicable three-year performance period is complete.
|
|
42 | UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT |
|
|
| |
DAVID B. BURRITT
President & Chief Executive Officer
|
| | |||||||||
| 2023 Compensation Decisions | | | ||||||||||||
|
Base Salary
|
| |
$1,400,000
|
| |
|
| | ||||||
|
AICP
|
| |
$4,284,000
|
| ||||||||||
|
LTIP
|
| | RSUs granted | | |
$3,800,000
|
| |||||||
| | | | TSR performance awards granted | | |
$3,350,000
|
| |||||||
| | | | ROCE performance awards granted | | |
$3,350,000
|
| |||||||
|
Total
|
| |
$16,184,000
|
| ||||||||||
|
Responsibilities
Mr. Burritt oversees U. S. Steel’s long-term strategic direction to deliver value for customers, employees and stockholders. He is responsible for the overall mission and culture at U. S. Steel, senior leadership development and succession planning, and engaging with key strategic customers, industry leaders, and policymakers.
|
| |
2023 Key Individual Performance Highlights
–
Set the tone for dedicated commitment to the S.T.E.E.L. Principles, and oversaw the best safety and environmental performance ever, continuing improvement over U. S. Steel’s record performance year over year.
–
Guided the Corporation through the strategic alternative review process, culminating in the Merger Agreement with NSC and NSNA, with a purchase price of $55.00 per share in cash, or a 142% premium to the undisturbed stock price on the day before announcement of the review process
–
Oversaw groundbreaking of first electrical steel line at Big River Steel (BRS), to expanding finishing capabilities and enhancing customer value proposition, and continued execution of strategic projects to enhance operating capabilities and progress on carbon emissions reduction goals
–
Continued engagement with customers and focus on strong operational quality and reliability performance, including setting productivity records and achieved best demonstrated performance at certain critical assets, enabling wins in strategic markets
–
Enhanced breadth and depth of succession planning and leadership development in C-Suite and throughout the ranks, and continued engagement with employees leveraging in-person and virtual connections
|
| |
UNITED STATES STEEL CORPORATION 2024 PROXY STATEMENT | 43 |
|
|
| |
JESSICA T. GRAZIANO
Senior Vice President & Chief Financial Officer
|
| | |||||||||
| 2023 Compensation Decisions | | | ||||||||||||
|
Base Salary
|
| |
$737,500
|
| |
|
| | ||||||
|
AICP
|
| |
$1,504,500
|
| ||||||||||
|
LTIP
|
| | RSUs granted | | |
$1,100,000
|
| |||||||
| | | | TSR performance awards granted | | |
$825,000
|
| |||||||
| | | | ROCE performance awards granted | | |
$825,000
|
| |||||||
|
Total
|
| |
$4,992,000
|
| ||||||||||
|
Responsibilities
Ms. Graziano leads all aspects of U. S. Steel’s financial organization, including accounting, credit, tax, treasury, investor relations, pension investments, internal controls and internal audit administrative oversight. She also oversees the strategy, real estate group, labor relations and sales and operations planning functions.
|
| |
2023 Key Individual Performance Highlights
–
Provided executive leadership of financial and strategic aspects of the strategic alternative review process culminating in the Merger Agreement with NSC
–
Led cost management initiative to streamline and optimize functional support organization
–
Refreshed engagement and leveling up of women’s mentoring and leadership throughout the organization
|
| |
|
|
| |
JAMES E. BRUNO
Senior Vice President, Global Information Technology & President USSE
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| 2023 Compensation Decisions | | | ||||||||||||
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Base Salary
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$691,250
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