Valero Board

Topics: Valero Energy Corporation, William R. Klesse, Texas Pages: 5 (710 words) Published: September 16, 2013
Introduction
​In a brief paragraph tell me what your firm does and what its primary products are.
1. Executive Compensation and Control
​From the firm’s Proxy Statements, compare the composition of the Board of Directors in 2011 (2012 Proxy) with 2006. What portion is “inside” versus “outside” directors? Now compare the compensation of the top executive and the top 5 between these two periods. How do they compensate their executives (i.e. regular salary, bonus, stock options, restricted stock, etc.) How does this compare with the firms share price performance and reported profits comparing the most recent year versus five years earlier? Does your firm appear to maximize shareholder value?

2. Financial Statements Analysis
Determine the portion of your firm’s value that is “market value added.” Select and calculate 2 “key” financial ratios for your firm using the methods developed in class or other ratios that you might feel better explain their position. How have these ratios changed over time considering the most recent 3 years? Compare your firm’s values with those of its major competitor. What can be concluded about your firm’s financial position?

Valero Energy Corporation is an independent petroleum refiner and marketer of other oil and ethanol products. Valero supplies the United States and other parts of the world with high value clean fuels and alternative energy sources. They are currently ranked in the top twenty of Fortune 500 companies and are based out of San Antonio, Texas. Valero Energy Corp operates sixteen refineries in the United States and ten ethanol plants. Through different merges and acquisitions, Valero has a network of over 6,800 retail and wholesale gas stations in the U.S., Canada, United Kingdom and the Caribbean which include the Valero, Diamond Shamrock and Texaco brands. Valero Energy Corp has recently relinquished its refinery ownership on the east coast of the United States but has acquired both plants and refineries in Europe.

1. (a). In 2011 the Board of Directors for Valero consisted on twelve individuals. This was made up of one female and twelve males. Of these twelve members, only one member was "inside" which was William Klesse the CEO. When comparing the composition of the board in 2011 with that of 2006 there have only been slight changes. In 2006, William Klesse was still the CEO and the board still consisted of only one female and one inside member. The main differences are that in 2006 the total board was made up of only ten members, eight of which still remain on the board in 2011. The two members that have been replaced were replaced by 4 additional members.

(b) Executive Compensation for 2011

Principal Year Salary Stock ​ Option Non-Equity Change in All Totals Position ​ Awards Awards Incentive Pension Value Other ​ Plan Comp & nonqualified Comp ​ Deferred

​ Compensation William R. Klesse
(CEO, President, & C.O.B)
2011
$1,500,000
$3,327,924
$1,277,472
$3,733,425
$987,033
$201,213
$11,027,067
Michael Ciskowski
(EVP & CFO)
2011
$750,000
$1,104,705
$424,057
$1,368,000
$1,962,944
$63,287
$5,672,993
Kimberly Bowers
(EVP)
2011
$535,000
$526,050
$201,932
$710,000
$492,536
$40,063
$2,505,581
S. Eugene Edwards
(EVP)
2011
$535,000
$526,050
$201,932
$710,000
$969,792
$47,096
$2,989,870
Joseph Gorder
(EVP)
2011
$535,000
$657,563
$252,415
$710,000
$437,050
$59,307
$2,651,335

(b) Executive Compensation for 2006

Principal Year Salary Stock ​ Option Bonuses Change in All Totals Position ​...
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