Phillips 66 Files Preliminary Proxy Statement for 2025 Annual Meeting: Strategic Board Nominations and Shareholder Proposals
Phillips 66 (NYSE: PSX) has taken a significant step toward its 2025 Annual Meeting of Shareholders by filing its preliminary proxy materials with the U.S. Securities and Exchange Commission (SEC). This filing outlines key proposals, board nominations, and strategic priorities that underscore the company’s commitment to driving long-term value for shareholders. As the energy giant prepares for its upcoming meeting, it emphasizes operational excellence, disciplined capital allocation, and shareholder engagement while addressing challenges posed by activist investor Elliott Investment Management.
Strengthening the Board with Proven Leadership
A cornerstone of Phillips 66’s strategy is ensuring the Board of Directors comprises individuals with diverse expertise and deep industry knowledge. In today’s filing, the company announced the nomination of two new candidates—A. Nigel Hearne and Howard I. Ungerleider—alongside existing nominees John E. Lowe and Robert “Bob” W. Pease. These additions aim to bolster the Board’s capabilities in critical areas such as refining operations, financial oversight, and strategic execution.
- A. Nigel Hearne: With over 35 years of experience in the energy sector, Hearne brings unparalleled downstream and integration expertise. His career includes leadership roles at Chevron Corporation, where he managed global operations across the value chain. Currently serving as Chief Operating Officer of Harbour Energy, Hearne’s insights will be invaluable in guiding Phillips 66’s strategic initiatives.
- Howard I. Ungerleider: A seasoned finance professional, Ungerleider previously served as President and CFO of Dow, overseeing the complex merger and spin-off of DowDuPont. His extensive background in chemicals and strategic transformations positions him as a vital asset for evaluating portfolio opportunities and enhancing shareholder value.
- John E. Lowe: An industry veteran with more than four decades of experience, Lowe has held leadership roles across midstream, refining, upstream, and chemicals businesses. His broad perspective on regulatory and operational matters makes him an ideal candidate to support Phillips 66’s ongoing transformation efforts.
- Robert W. Pease: Identified through collaboration with Elliott Investment Management, Pease contributes 38 years of refining and operations expertise. His appointment reflects the Board’s openness to constructive dialogue and reinforces its focus on improving efficiency and optimizing costs within the refining segment.
Glenn F. Tilton, the Board’s lead independent director, emphasized the importance of these nominations: “The addition of Nigel and Howard will add fresh insights from proven global leaders who bring unique perspectives highly relevant to our position in the industry and our long-term strategy.”
Commitment to Board Declassification
Phillips 66 continues to advocate for the declassification of its Board—a move it believes aligns with best practices for corporate governance and enhances accountability. At the 2025 Annual Meeting, the company will seek shareholder approval to amend its certificate of incorporation and by-laws to implement this change. This marks the sixth time in the past decade that Phillips 66 has pursued this initiative, underscoring its dedication to modernizing governance structures.
In contrast, Elliott Investment Management has proposed a policy requiring annual resignations of all directors. The Board views this proposal as a distraction that contravenes Delaware corporate law principles and risks prioritizing short-term gains over sustainable growth. Shareholders are urged to vote against Elliott’s proposal and support management’s declassification plan.
Addressing Activist Investor Concerns
Phillips 66 has maintained an open dialogue with Elliott Investment Management since 2023, seeking common ground on strategies to enhance shareholder value. This engagement led to the appointment of Bob Pease to the Board, reflecting mutual recognition of his expertise in refining operations. However, recent discussions have encountered obstacles, particularly regarding additional director appointments and Elliott’s evolving demands.
Elliott’s public criticisms and calls for separation have raised concerns among the Board about potential risks to shareholder value. Glenn F. Tilton noted, “Elliott’s inconsistent approach and evolving demands would introduce undue risk by prioritizing uncertain short-term gains over a disciplined, long-term strategy.” Despite these challenges, Phillips 66 remains committed to constructive engagement and welcomes further dialogue when Elliott is ready.
Driving Long-Term Value Creation
At the heart of Phillips 66’s strategy lies a commitment to operational excellence and effective capital allocation. The company operates one of the most integrated downstream businesses in North America, leveraging its differentiated portfolio to serve highly attractive markets. By focusing on efficiency improvements, cost optimization, and strategic investments, Phillips 66 aims to deliver consistent returns for shareholders.
Shareholders play a crucial role in supporting this vision. To ensure alignment with the Board’s recommendations, Phillips 66 encourages investors to use the WHITE proxy card or WHITE voting instruction form to vote FOR the four nominated directors and AGAINST Elliott’s advisory proposal. Detailed information about the nominees, the company’s strategy, and voting instructions will be included in the definitive proxy materials mailed to shareholders shortly.
Staying Informed Ahead of the 2025 Annual Meeting
Phillips 66 is dedicated to keeping shareholders informed throughout the proxy process. For updates and additional resources, visit Phillips66Delivers.com. The company urges shareholders to discard any GOLD proxy cards sent by Elliott and rely solely on official communications from Phillips 66.
As Phillips 66 prepares for its 2025 Annual Meeting, the company reaffirms its commitment to transparency, accountability, and long-term value creation. With a refreshed Board, a clear strategic roadmap, and unwavering focus on shareholder interests, Phillips 66 is poised to navigate the complexities of the energy landscape while delivering sustainable results for all stakeholders.
By voting in favor of the company’s recommendations, shareholders can help ensure Phillips 66 remains a leader in the industry and continues to generate compelling returns for years to come.
