Topic Highlights
Business success stems from strong corporate governance driven by the Board of Directors, which oversees the management of our business with a focus on policy, oversight, and strategic direction.
In 2023:
- Female directors comprised over half of our Board and served in key leadership roles, including serving as chair of our Board and all four of our standing Board Committees.
- 9% of our directors were racially/ethnically diverse.
- We included environmental and safety performance measures in our incentive compensation programs and aligned executive compensation opportunity with the successful achievement of our environmental and safety goals.
- We tracked nearly 400 ESG metrics within our digital work environment to position us for opportunities to enhance our performance.
our governance structureOur Governance Structure
Our Board of Directors (Board) is the highest governance body at EQT and oversees the management of our business with a focus on policy, oversight, and strategic direction. All directors on our Board annually stand for election to reinforce our Board’s accountability to our shareholders. We have only one class of voting stock. Additionally, our Board has adopted and maintains comprehensive Corporate Governance Guidelines, which require, among other things, that a majority of our directors be independent and that an independent director be annually appointed to serve as our Board Chair. The leadership responsibilities of our independent Board Chair are outlined in paragraph 5(g) of our Corporate Governance Guidelines.
The Board maintains four standing committees:
- Audit Committee
- Corporate Governance Committee
- Management Development and Compensation Committee (Compensation Committee)
- Public Policy and Corporate Responsibility Committee (PPCR Committee)
The responsibilities of each standing Board Committee are set forth in a written charter, a copy of which is available on our Governance Documents webpage. The Corporate Governance Committee and our full Board annually review Committee Charters. Additionally, our Board may form new committees, disband existing committees, and delegate responsibilities to a committee.
Consistent with our core values, our Board values diversity and believes it affords the opportunity for a variety of viewpoints, improving the quality of dialogue and contributing to a more effective decision-making process. Details regarding certain diversity characteristics of our Board are included in the chart below. As of December 31, 2023, female directors represented over half of our Board and served in key leadership roles, including serving as Chair of our Board and all four of our standing Board Committees. Our Board also recognizes the importance of, and benefits from, racial and ethnic diversity. As of December 31, 2023, 9% of our directors are racially/ethnically diverse and 55% of our directors are women. As our Board evolves, racial and ethnic diversity will continue to be an important factor in assessing the Board’s overall mix of skills, experience, background, and characteristics. More information about our Board of Directors can be found on our Board of Directors webpage.
EQT Board of Directors Composition and Diversity [1]
[1] Minority population includes American Indian/Alaska Native, Asian, Black/African American, Hispanic, or Latino or any employee disclosing two or more races.
ESG Oversight
Two Board-level Committees — the Corporate Governance Committee and the PPCR Committee — are responsible for evaluating and providing oversight, guidance, and perspective with respect to our ESG strategy. Each of these Committees meets at least quarterly and has explicit ESG oversight responsibilities embedded within their formal committee charters.
Our management-level ESG Committee helps guide the execution of our ESG strategy with oversight support from the Corporate Governance and PPCR Committees of the Board. Our ESG Committee is comprised of our Chief Executive Officer, General Counsel, and other senior leaders, and meets every other week. The ESG Committee reports and makes recommendations regularly to both the Corporate Governance and PPCR Committees on current ESG matters. Our full Board also discusses critical ESG topics such as safety, sustainability, climate change, and other environmental matters during the five regular Board meetings each year.
Compensation
Executives and other employees participate in our Short-Term Incentive Plan (STIP), our annual cash incentive compensation program. Executives also participate in our Long-Term Incentive Plan (LTIP), our long-term equity incentive compensation program, with awards granted under the LTIP being comprised of Incentive Performance Share Units issued under our Incentive Performance Share Unit Program (IPSUP) and Restricted Share Units. The incentive compensation opportunity available under the STIP is based on our successful achievement of specific financial, operational, and Environmental, Health, and Safety (EHS) performance goals, which are reviewed and established annually by the Compensation Committee of our Board. The incentive compensation opportunity available under the IPSUP is generally dependent on our company’s total shareholder return performance based on a matrix of absolute and relative total shareholder return performance. The Compensation Committee of our Board establishes the compensation performance metrics annually and reviews our performance against these metrics before they certify payout of compensation under the applicable year’s STIP and IPSUP.
Beginning in 2021 and through 2023, the Compensation Committee included a targeted year-over-year reduction of greenhouse gas (GHG) emissions intensity as a performance metric in our STIP. Reductions in our GHG emissions intensity is an important component of our ESG strategy, and the Compensation Committee views this environmental performance measure as a meaningful way to link annual incentive compensation opportunity with achievement of our GHG intensity reduction goals.
For 2023, 25% of our STIP funding was linked to ESG-focused measures — specifically, GHG emissions intensity reduction and safety performance.
The Compensation Committee prioritizes environmentally responsible operations and carbon offset generation to achieve our net-zero goal by attributing a portion of our executive and senior management compensation opportunity to our environmental performance — maintaining accountability for our emissions targets. In 2023, we continued to drive progress on our goal of net-zero GHG emissions from our current Production segment operations on a Scope 1 and Scope 2 basis by or before 2025. The Compensation Committee incorporated our 2025 net-zero goal into the 2022 IPSUP[1] by including a performance payout modifier that links a meaningful portion of participant payout opportunity to both (i) achieving our goal of net-zero GHG emissions by or before 2025 and (ii) how net-zero is achieved. This payout modifier will result in reduced incentive compensation opportunities if our net-zero goal is either not achieved or if it is achieved through the purchase of carbon credits in excess of the benchmark threshold established by the Compensation Committee. For more information on our STIP and IPSUP, and the related performance metrics, see our 2024 Proxy Statement.
ESG Strategy Development and Implementation
Our ESG Committee leverages external research and benchmarking, evaluates ESG data trends, and engages stakeholders to identify the issues most pertinent to us and to our stakeholders and to identify potential opportunities for improvement. Examples of our stakeholder engagement include external outreach to investors, credit providers, landowners, environmental certification organizations, nongovernmental organizations, and other groups to better understand how we can address key ESG issues. Every three years, we also conduct a robust strategic materiality assessment to confirm that our ESG disclosures, initiatives, and strategy align with our internal and external stakeholders’ expectations for us as a company. We most recently conducted a refreshed strategic materiality assessment in 2022. For more information on our strategic materiality assessment and our overall stakeholder engagement strategy, see Stakeholder Engagement and Materiality.
Our ESG Committee also assists our executive team and senior management to develop, implement, and monitor initiatives, processes, policies, and disclosures in accordance with our ESG strategy. In combination with our Board and Committee oversight, the ESG Committee provides input to the Board on strategic direction and works with senior management and specific business departments to coordinate company-wide implementation and execution of our ESG strategy.
ESG Reporting
Our ESG Committee oversees our ESG reporting process, including coordination with internal subject matter experts (SMEs) as needed. In addition, our Board and Chief Executive Officer have an opportunity to review and provide feedback on our annual ESG Report.
[1] Our IPSUP compensation plans are based on a 3-year performance period and potential payouts under each IPSUP are assessed at the end of the applicable performance period. For example, the 2022 IPSUP performance period extends from 2022 through 2024. Because our net-zero goal was established as a milestone to be achieved by 2025, meaning that performance against this objective will be measured as of year-end 2024, the Compensation Committee determined that it would not be appropriate to include a payout modifier for achievement of our net-zero goal beyond the 2022 IPSUP.
