VALERO ENERGY CORP (VLO)
Sector: Energy
2026 Annual Meeting Analysis
VALERO ENERGY CORP · Meeting: May 7, 2026
Directors FOR
10
Directors AGAINST
0
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Directors
Diaz joined in 2021, meets attendance requirements, holds 3 other public board seats (within the 4-seat limit), and Valero's 3-year TSR of +106.6% outperforms the XLE benchmark by +45.0pp, well below the 65pp threshold required to trigger an AGAINST vote for a strong-positive TSR company.
Eberhart joined in 2016, meets attendance requirements, holds 3 other public board seats (within the 4-seat limit), and Valero's 3-year TSR outperformance of +45.0pp vs. XLE does not meet the 65pp trigger threshold; no other disqualifying flags apply.
Ffolkes joined in 2022, meets attendance requirements, holds 1 other public board seat, and the TSR underperformance trigger does not fire; no other disqualifying flags apply.
Greene joined in 2016, meets attendance requirements, holds no other public company board seats, and the TSR trigger does not apply given Valero's strong absolute and relative performance; no other disqualifying flags apply.
Majoras joined in 2012, meets attendance requirements, holds 1 other public board seat, and the TSR underperformance trigger does not fire at Valero's current outperformance level; no other disqualifying flags apply.
Mullins joined in 2020, meets attendance requirements, holds no current public board seats other than Valero, and the TSR trigger does not apply; no other disqualifying flags apply.
Reymond joined in September 2025, which is within the 24-month new-director exemption window, so he is automatically exempt from the TSR underperformance trigger; no other disqualifying flags apply.
Riggs joined as a director in 2023, serves as CEO and Chairman, meets attendance requirements, holds no outside public board seats, and Valero's 3-year TSR of +106.6% outperforms XLE by +45.0pp, well below the 65pp threshold needed to trigger an AGAINST vote; no other disqualifying flags apply.
Weisenburger joined in 2011, meets attendance requirements, holds 3 other public board seats (within the 4-seat limit), and the TSR underperformance trigger does not fire; no other disqualifying flags apply.
Wilkins joined in 2011, meets attendance requirements, holds 2 other public board seats (within the 4-seat limit), and Valero's strong outperformance versus XLE means the TSR trigger does not apply; no other disqualifying flags apply.
All 10 director nominees receive a FOR vote. Valero's 3-year total shareholder return of +106.6% outperforms the XLE energy sector ETF by +45.0pp, which is comfortably below the 65pp underperformance threshold required to trigger votes against directors at a company with a strong-positive absolute TSR. No director is overboarded, attendance was above 97% in aggregate, all board committees are fully independent, and no familial relationships or other disqualifying factors were identified.
Say on Pay
✓ FORCEO
R. Lane Riggs
Total Comp
$34,228,523
Prior Support
74.78%%
The 2025 say-on-pay vote covers CEO compensation of approximately $34.2 million for R. Lane Riggs. The pay program is heavily weighted toward variable compensation — the proxy states that 90% of the CEO's target total pay is at risk — with long-term incentives split evenly between performance shares tied to relative total shareholder return versus a 12-company peer group and restricted stock, plus an annual cash bonus tied to financial, operational, and safety metrics; this structure comfortably clears the 50-60% variable pay threshold. Valero's stock returned +106.6% over three years versus the XLE energy sector ETF's +61.6%, a +45.0pp outperformance, confirming that above-benchmark incentive pay is justified by shareholder outcomes. Although last year's say-on-pay vote came in at 74.78% (just above the 70% threshold that would require visible changes), the company engaged extensively with shareholders, held 58 meetings with investors and proxy advisors, and the lower result was attributed primarily to a single proxy advisor's negative recommendation rather than a fundamental compensation design flaw; the program itself was not changed but additional disclosures were added, which represents a reasonable response. The clawback policy, stock ownership guidelines, anti-hedging rules, and absence of change-of-control gross-ups are all strong governance features that further support a FOR vote.
Auditor Ratification
✓ FORAuditor
KPMG LLP
Tenure
N/A
Audit Fees
N/A
Non-Audit Fees
N/A
KPMG is a Big 4 firm, appropriate for a company of Valero's size and complexity. The auditor fee table provided in the filing context does not include extractable dollar figures for audit versus non-audit fees, so the non-audit fee ratio trigger cannot be evaluated; per policy, the tenure trigger requires confirmed data to fire and tenure is not disclosed, so no negative trigger is activated. No material restatements were identified. The default vote is FOR.
Stockholder Proposals
1 proposal submitted by shareholders
Proposal 4
Stockholder Proposal Requesting Disclosure of Estimated Magnitude of Off-Balance Sheet Asset Retirement Obligations (2026 ARO Proposal)
This proposal asks Valero to disclose the estimated size of certain environmental cleanup obligations that the company says it does not record on its balance sheet because accounting rules require that such obligations only be recorded when the timing and amount can be reasonably estimated. The company and its independent auditor have concluded that providing the requested estimates would be inconsistent with standard accounting rules and would be misleading to investors, a position the SEC staff agreed with when granting no-action relief — meaning this proposal will not actually appear on the ballot for shareholders to vote on. Even if it were to appear, the company's substantive response — that the disclosure would conflict with the conclusions of its auditors and established accounting standards — is a credible and specific objection that goes beyond a generic 'we already do this' dismissal, and a substantially identical proposal received the same treatment in 2023. A vote AGAINST is appropriate based on the company's well-reasoned opposition and the SEC's concurrence.
Overall Assessment
Valero's 2026 annual meeting ballot presents three standard proposals: election of 10 directors, advisory approval of 2025 executive compensation, and ratification of KPMG as auditor, all of which receive FOR votes under this policy. A stockholder proposal requesting disclosure of off-balance sheet environmental cleanup obligations receives an AGAINST vote because the company and its auditors concluded the disclosures would conflict with accounting standards, and the SEC granted no-action relief excluding the proposal from the ballot.