DEF 14A

DEF 14A 1 d44138ddef14a.htm DEF 14A DEF 14A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No. )

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Freeport-McMoRan Inc.

(Name of Registrant as Specified In Its Charter)


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LOGO

LETTER TO STOCKHOLDERS

Dear Fellow Stockholders,

Our board of directors has remained steadfast in prioritizing the health and well-being of our workforce, supporting our communities, serving our customers, and positioning Freeport-McMoRan for long-term success in the midst of the global pandemic and economic uncertainty. Our global team responded to the challenges of this past year and delivered exceptional performance, outperforming all of our peers on a stockholder return basis and finishing the year as the eighth best-performing stock in the S&P 500.

Early in 2020, we proactively implemented protective health protocols throughout our global operations that followed international and local guidelines and continued to enhance those protocols throughout the year. We also took various steps to support our local host communities and indigenous neighbors to help them navigate the pandemic. Our board remains actively engaged with management in guiding these initiatives and is regularly updated on the company’s actions to address the ongoing impacts of the pandemic on our business and stakeholders.

Freeport-McMoRan also achieved significant environmental, social and governance (ESG) related milestones in 2020. We published new climate and water reports, established a 2030 greenhouse gas (GHG) emissions reduction target for the Americas and committed to aligning our climate strategy and related disclosures with the Task Force on Climate-related Financial Disclosures (TCFD). We also committed to the Copper Mark, a new comprehensive industry-specific assurance framework that promotes responsible production practices in alignment with the United Nations Sustainable Development Goals. We continue to focus on human capital management, with progress made on strengthening inclusion and diversity initiatives across our workforce. Finally, we have committed to reporting in line with the Sustainability Accounting Standards Board (SASB) framework. Our board understands that robust ESG practices, transparency, and reporting are integral components of producing sustainable long-term value for all of our stakeholders.

In February 2021, in connection with the retirement of our non-executive chairman, Gerald J. Ford, our board elected our chief executive officer, Richard C. Adkerson, as chairman, and me as lead independent director. We are immensely thankful to Mr. Ford for his leadership, legacy of service, and leading independent oversight by our board. Mr. Adkerson has decades of industry and operational experience, a vision for the company’s long-term strategy, connectivity to our global workforce, and strong relationships with our stakeholders. My fellow independent directors and I will continue to provide Mr. Adkerson and the rest of the management team with independent counsel and oversight to drive sustainable, long-term value creation.

As part of our ongoing review of our board’s composition, we remained committed to recruiting additional independent directors who would expand our board’s skillsets, perspectives and capabilities. Following a robust search process, we recently welcomed David P. Abney, retired Chairman and Chief Executive Officer of United Parcel Service, Inc., and Robert W. Dudley, retired Group Chief Executive of BP, p.l.c., to our board. Messrs. Abney and Dudley both bring exceptional track records of leadership and experience in a wide range of matters relevant to the company, including global business, corporate governance, and sustainability. The addition of these directors is consistent with our objectives of having a board with expansive and diverse experience, a deep understanding of the challenges and opportunities associated with our global business and a focus on value and sustainability for the benefit of all stakeholders. Our director recruitment efforts are ongoing and further additions to the board are anticipated.

I look forward to continuing to engage with our stockholders as part of the company’s ongoing engagement program. I have valued the opportunities to hear your feedback on topics important to you over the past few years. On behalf of the board, thank you for your continued trust and investment in our company.

Sincerely,

LOGO

DUSTAN E. MCCOY

Lead Independent Director

April 22, 2021

LOGO

NOTICE OF 2021 ANNUAL MEETING OF STOCKHOLDERS

Date:

Tuesday June 8, 2021

Time:

1:00 p.m. Eastern Time

Website:

www.meetingcenter.io/290222756

Purpose:

•

Elect seven directors;

•

Ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2021;

•

Approve, on an advisory basis, the compensation of our named executive officers; and

•

Transact such other business as may properly come before the annual meeting.

Record Date:

Only stockholders of record as of the close of business on April 12, 2021, are entitled to vote at the annual meeting and any adjournment or postponement of the meeting.

Joining the Virtual Annual Meeting:

As a result of the continuing public health impact of the COVID-19 pandemic and to prioritize the health and well-being of meeting participants, this year’s annual meeting will be conducted virtually via a live audio webcast, accessible at www.meetingcenter.io/290222756. Please see “Questions and Answers About the Proxy Materials, Annual Meeting and Voting” beginning on page 62 for information about how to join and participate in the virtual annual meeting (including to vote, view the list of stockholders of record and submit questions pertinent to the meeting).

Proxy Voting:

Your vote matters. Regardless of whether you plan to join the virtual annual meeting, please promptly submit your proxy and voting instructions via the internet or phone, or sign, date and return a proxy card (if received by mail). Stockholders are encouraged to submit proxies and voting instructions in advance of the meeting by internet or phone, or by signing, dating and returning a proxy card, as early as possible to avoid any possible delays. Your cooperation is appreciated.

By Order of the Board of Directors.

LOGO

MONIQUE A. CENAC

Assistant General Counsel and Corporate Secretary

April 22, 2021

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE

ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 8, 2021.

This proxy statement and the company’s 2020 annual report to stockholders are available at

edocumentview.com/FCX

TABLE OF CONTENTS


Proxy Summary			1
2021 Annual Meeting of Stockholders			1
Agenda and Voting Recommendations			1
2020 Performance Highlights			1
COVID-19 Response and Human Capital Management			2
Stakeholder Engagement Highlights			2
Board Refreshment Update			3
Director Nominee Highlights			3
Executive Compensation Highlights			4
Corporate Governance Highlights			5


Stakeholder Engagement			6


Sustainability			7
Board Oversight and Management of Sustainability			7
2020 Sustainability Highlights			8
Sustainability Program Aligns with International Best Practices			8
Climate Change			9
Inclusion and Diversity			9


Corporate Governance			10
Corporate Governance Guidelines; Principles of Business Conduct			10
Board Leadership Structure			10
Board Refreshment			11
Director Nominations and Qualifications			11
Succession Planning for Senior Executives			12
Board’s Role in Oversight of Strategy and Risk Management			12
Board Committees			14
2020 Board Meetings and Attendance			15
Board and Committee Independence; Audit Committee Financial Experts			15
Compensation Committee Procedures			16
Limitation on Additional Board and Committee Service			16
Board and Committee Evaluation Process			17
Director Candidates Submitted by Stockholders			17
Communications with the Board			18
Availability of Corporate Governance Documents			18


Stock Ownership			19
Director and Executive Officer Stock Ownership Guidelines			19
Stock Ownership of Directors and Executive Officers			19
Hedging and Pledging Policies			21
Stock Ownership of Certain Beneficial Owners			21


Proposal No. 1: Election of Directors			22
Information About Director Nominees			24

Freeport-McMoRan | 2021 Proxy Statement i


Executive Officer Compensation			28
Compensation Discussion and Analysis			28
Executive Summary			29
Executive Compensation Philosophy			32
Principal Components of Executive Compensation			33
Post-Termination Compensation			39
Compensation Processes and Policies			40
Compensation Committee Report			42
Executive Compensation Tables			43
Summary Compensation Table			43
2020 Grants of Plan-Based Awards			45
Outstanding Equity Awards at December 31, 2020			46
2020 Option Exercises and Stock Vested			47
Nonqualified Deferred Compensation			48
Pension Benefits			49
Potential Payments Upon Termination or Change in Control			53
CEO Pay Ratio			54


Audit Committee Report			55


Independent Registered Public Accounting Firm			56


Proposal No. 2: Ratification of the Appointment of Ernst & Young LLP as our Independent Registered Public Accounting Firm for 2021			57


Proposal No. 3: Advisory Vote on the Compensation of Our Named Executive Officers			58


Certain Transactions			59


Director Compensation			59
Director Compensation Philosophy			59
Process of Setting Director Compensation			59
Cash Compensation			60
Equity-Based Compensation			60
Frozen and Terminated Retirement Plan			60
Director Compensation Table			61


Questions and Answers About the Proxy Materials, Annual Meeting and Voting			62


2022 Stockholder Proposals			69


Annex A – Methodology Used to Calculate Certain AIP Metrics			A-1

Cautionary Statement Regarding Forward-Looking Statements

This proxy statement contains forward-looking statements, which are all statements other than statements of historical facts. We caution readers that forward-looking statements are not guarantees of future performance and actual results may differ materially from those anticipated, expected, projected or assumed in the forward-looking statements. Important factors that can cause our actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to, those described in more detail under the heading “Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2020 (2020 Form 10-K), filed with the U.S. Securities and Exchange Commission. We undertake no obligation to update any forward-looking statements. This proxy statement also contains certain financial measures that are not recognized under generally accepted accounting principles (GAAP) in the United States, including adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), net debt and consolidated unit net cash costs. Please refer to Annex A to this proxy statement for a reconciliation of adjusted EBITDA to net income, the most directly comparable GAAP financial measure, and other information regarding our calculations for net debt and consolidated unit net cash costs.

ii Freeport-McMoRan | 2021 Proxy Statement

PROXY SUMMARY

This summary highlights selected information contained elsewhere in this proxy statement. This summary does not contain all of the information that you should consider, and you should read the entire proxy statement carefully before submitting your proxy and voting instructions. For more complete information regarding our 2020 performance, please review our 2020 annual report to stockholders (2020 annual report), which is being made available to stockholders together with these proxy materials on or about April 22, 2021.

2021 Annual Meeting of Stockholders


Time and Date:		1:00 p.m. Eastern Time, Tuesday, June 8, 2021

Website:		www.meetingcenter.io/290222756

Record Date:		Monday, April 12, 2021

Agenda and Voting Recommendations



Item	Description	Board Vote Recommendation	Page

No. 1	Election of seven directors	FOR each nominee	22
No. 2	Ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2021	FOR	57
No. 3	Approval, on an advisory basis, of the compensation of our named executive officers	FOR	58

2020 Performance Highlights (page 29)

8^th

Best-performing stock in

S&P 500

3.2B lbs

Consolidated sales of copper

0.9M oz

Consolidated sales of gold

$599M

Net income attributable to common stock

$3.0B

Operating cash flows

$2.0B

Capital expenditures

$1.75B

Decrease in net debt⁽*⁾

$3.7B

Consolidated cash at year end 2020

Operational Highlights

• Team demonstrated resilience in managing uncertain business environment

• Safety statistics, measured by incident rates, met our targets

• Solid cost and capital management

• Achieved significant project execution milestones

^¡ Grasberg underground reached 68% of annual targeted metal run rate

^¡ Completed Lone Star project; ramp-up is on schedule

New Financial Policy

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Financial Highlights

• Strong cash flow generation

• Opportunistic debt refinancing to extend maturities

• Meaningful reduction in net debt⁽*⁾

• Established attractive foundation for future growth

• 2020 performance set stage for board in early 2021 to reinstate dividend on common stock and adopt a new performance-based financial policy

Stock Performance

• Total return of 99% for 2020

• Top performing stock compared to 8-member performance peer group

• 8^th best-performing stock in S&P 500

Delivered on ESG Commitments

• Published inaugural climate report and established 2030 GHG emissions reduction target for the Americas

• Joined United Nations Global Compact

• Active leadership role in development of Global Industry Standard on Tailings Management

• Committed to achieving the Copper Mark at all copper producing sites; to date, six sites have been awarded the Copper Mark (Cerro Verde, El Abra, Atlantic Copper, Miami, Morenci, and El Paso)

• Published water report

(*)Net debt equals consolidated debt less consolidated cash.

Freeport-McMoRan | 2021 Proxy Statement 1

COVID-19 Response and Human Capital Management

People are at the core of our business. We are deeply committed to supporting the health, safety and well-being of our people, which was further emphasized as the COVID-19 pandemic created unprecedented challenges for our workforce and their families, our host communities and indigenous neighbors, and for society at large. Throughout 2020, our board continued to exercise its active oversight role with a focus on the company’s COVID-19 response and human capital management. The board discussed these topics at each of its 11 meetings in 2020 and also received regular communications throughout the year from our chief executive officer (CEO) regarding actions being taken to support the health, safety and well-being of our workforce, support being provided to our host communities, supply chain resiliency and execution of our operating plans.

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Protecting our Workforce and their Families

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Supporting our Local Communities and Indigenous Neighbors

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Maintaining Resiliency and Value

• Adhering to global standards to manage health and hygiene

• Established flexible, remote working plans for all administrative employees starting in mid-March

• All non-essential travel cancelled

• Committed to maintaining health benefits during the pandemic and beyond

• Offering guidance resources to support mental and physical well-being

• Ongoing communication and engagement efforts

• Partnering with local governments, medical institutions, charities and non-governmental organizations (NGOs) to provide support

• Providing monetary and in-kind contributions of medical supplies and food including:

^¡ Ventilators and an ambulance in Calama, Chile

^¡ Portable oxygen plant and cylinders in Arequipa, Peru

^¡ Testing and food donations in Papua, Indonesia

^¡ Supplies to hospitals, health clinics and first responders in 27 locations in 4 states and 6 tribal nations across the U.S.

• Rapid response efforts initiated at corporate and operating sites

• Wide-ranging controls in place across all operations including temperature checks, rapid/PCR tests, social distancing, extensive cleaning and established isolation areas on-site in the event of positive tests

• Focused on supply chain resiliency

• Effectively managing costs and financial liquidity

• Maximizing cash flow while preserving large resources and asset values for the future

Stakeholder Engagement Highlights (page 6)

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2 Freeport-McMoRan | 2021 Proxy Statement

Board Refreshment Update (page 11)

Our board has remained focused on thoughtfully enhancing the composition and size of the board. In 2019, our governance committee initiated a robust director search process following certain unexpected decreases in our board size and in response to feedback obtained during our annual board evaluation process. To facilitate this process, the governance committee engaged an independent global search firm to assist with identifying, evaluating and recruiting a diverse pool of potential director candidates. This search process has resulted in the appointment of three new independent directors to the board since 2019: John J. Stephens in October 2019 and, most recently, David P. Abney and Robert W. Dudley in April 2021. Our two newest directors, Messrs. Abney and Dudley, are exceptional leaders with proven track records and experience in complex global business, including corporate governance, sustainability, extractives industry experience, supply chain resilience and logistics, and a wide range of other matters relevant to the company. These additions to our board are consistent with our objective to have a board with expansive and diverse experience, a deep understanding of the challenges and opportunities associated with our global business and a focus on value and sustainability for the benefit of all stakeholders. Our director recruitment efforts are ongoing with the assistance of the search firm and further additions to the board are anticipated. The committee continues to emphasize the importance of diversity and in accordance with our board diversity policy, has instructed the firm to include women and persons of ethnic and racial diversity in the pool of candidates.

Director Nominee Highlights (page 24)

Name and Principal

Occupation

Age

Director

Since

Independent

Committee Memberships⁽*⁾

Other
Public
Company
Boards⁽**⁾

Audit

Comp.

Governance

Corporate
Responsibility

David P. Abney

Retired Chairman of the Board and Chief Executive Officer

United Parcel Service, Inc.

2021

✓

Richard C. Adkerson

Chairman of the Board and Chief Executive Officer

Freeport-McMoRan Inc.

2006

Robert W. Dudley

Retired Group Chief Executive

BP, p.l.c.

2021

✓

Lydia H. Kennard

President and Chief Executive Officer

KDG Construction Consulting

2013

✓

Chair

✓

Dustan E. McCoy⁽***⁾

Retired Chairman and Chief Executive Officer

Brunswick Corporation

2007

✓

Chair

✓

John J. Stephens

Retired Senior Executive Vice President and Chief Financial Officer

AT&T Inc.

2019

✓

Chair

Frances Fragos Townsend

Executive Vice President of Corporate Affairs

Activision Blizzard

2013

✓

Chair

All information current as of the record date, April 12, 2021.

(*)

As previously disclosed, Mr. Ford will retire as a director effective as of the date of our 2021 annual meeting. Messrs. Abney and Dudley have not yet been assigned to any committees as our board is currently in the process of reviewing committee assignments.

(**)

As publicly disclosed, Mr. Abney has notified Macy’s, Inc. that he does not intend to stand for re-election to Macy’s board at the company’s annual meeting being held on May 21, 2021. Also, as publicly disclosed, Mr. Dudley is a nominee for election to the board of LyondellBasell Industries N.V. at the company’s annual meeting to be held on May 28, 2021.

(***)

Mr. McCoy serves as our lead independent director.

Freeport-McMoRan | 2021 Proxy Statement 3

Our director nominees represent a range of tenures and overall experience, which contributes to a variety of perspectives and facilitates transition of institutional knowledge from longer-serving members to newer members of our board. We believe this balanced composition is in the best interest of our company and our stockholders, as our industry and strategic initiatives often have prolonged lifecycles, and it is therefore helpful to have seasoned directors who are familiar with our company and can draw on past experience and expertise balanced with newer directors who bring fresh perspectives. Our governance committee remains committed to an ongoing review of the board’s composition to ensure that we continue to have the right mix of skills, background, diversity and tenure to position the company for long-term success.

LOGO

The above statistics are calculated as of the record date, April 12, 2021 with respect to our director nominees.


Diverse Experience, Qualifications, Attributes and Skills
✓	Senior Leadership Experience	✓	Natural Resources, Mining, Metals Industry Experience	✓	International Business/Global Affairs
✓	Sustainability	✓	Operational Management/Risk Management	✓	Accounting/Financial Expertise
✓	Government, Legal and/or Regulatory Compliance	✓	Public Company Board Experience	✓	Capital Markets/Banking

Executive Compensation Highlights (page 28)

• In response to the COVID-19 pandemic, our two most senior executives voluntarily agreed to reduce their 2020 base salaries by 25% and further agreed to take 90% of the reduced salaries in the form of restricted stock units (RSUs) instead of cash to help preserve liquidity.

• A majority of our executive officers’ target direct compensation is at risk and requires measurable performance and increases in stock price under our annual incentive (AIP) and long-term incentive (LTIP) programs.

o No adjustments to our AIP or LTIP performance targets or results; AIP awards for 2020 earned at 143.9% of target based on performance metrics, but management recommended and the compensation committee exercised negative discretion to reduce the payouts to 125% of target in part due to our COVID-19 related cost reductions.

LOGO

o Payout of 2018 performance share units (PSUs) in early 2021 at 116% of target based on achievement of long-term performance metrics.

• AIP uses financial, operational and ESG metrics to measure performance.

• 100% of our CEO’s 2020 LTIP award was performance-based: 67% PSUs (with payout based on achievement of return on investment (ROI) metrics with a total stockholder return (TSR) modifier) and 33% stock options (with ultimate value dependent on increases in stock price).

4 Freeport-McMoRan | 2021 Proxy Statement

Corporate Governance Highlights (page 10)

We are committed to effective corporate governance that is informed by and promotes the long-term interests and rights of our stockholders, strengthens board and management accountability, and engenders public trust in our company. Our commitment to good corporate governance is evidenced by the following practices:


Board Structure and Governance				✓ Active board oversight of risk ✓ Lead independent director of the board with defined and robust responsibilities ✓ Highly independent and diverse board and fully independent committees ✓ Demonstrated board refreshment and diversity ✓ Board diversity policy ✓ Limitations on additional public company board and committee service, including a limitation on audit committee service for members of our audit committee ✓ Annual board and committee performance evaluations via one-on-one interviews with lead independent director ✓ Regular executive sessions

Stockholder Rights and Engagement				✓ Stockholder proxy access ✓ Majority voting for directors ✓ Stockholder right to call special meetings (15%) ✓ Stockholder right to act by written consent ✓ Robust stockholder engagement program with history of responsiveness to stockholders

Sustainability				✓ Established climate strategy and 2030 GHG emissions reduction target for the Americas ✓ Long-standing commitment to sustainable and responsible production ✓ Formalized standalone Inclusion and Diversity Policy ✓ Committed to report ESG disclosures in alignment with SASB and TCFD frameworks ✓ Active leadership role in development of Global Industry Standard on Tailings Management

Stock Ownership				✓ Stock ownership guidelines of 6x base salary for our CEO ✓ Stock ownership guidelines of 5x annual fee (currently $125,000) for non-management directors ✓ Stock ownership guidelines of 3x base salary for our other executive officers

Freeport-McMoRan | 2021 Proxy Statement 5

STAKEHOLDER ENGAGEMENT

We maintain an ongoing, proactive and expansive stakeholder engagement program. Direct engagement with our stockholders is a critical pillar of this program. Our board and management have a history of engaging with stockholders and incorporating feedback into their decision-making processes. We also maintain dialogue and gather input from our broader group of stakeholders including governmental organizations and NGOs, customers and the communities in which we operate. The board’s corporate responsibility committee and management’s sustainability development leadership team provide oversight of our engagement efforts.

LOGO

We received positive feedback regarding our enhanced ESG disclosures and our commitment to report in alignment with SASB and TCFD frameworks.


Goals of Engagement
✓		Foster mutual understanding, trust and cooperation with our broad range of stakeholders
✓		Understand changing needs and expectations of stakeholders through ongoing, constructive and proactive engagement
✓		Strengthen our company by discussing topics that matter to stakeholders
✓		Incorporate feedback from engagements into boardroom and management decision-making
✓		Effectuate continuous evolution of our governance framework and compensation practices
✓		Share information about our strategy, practices and performance
✓		Reduce sustainability-related risks and continue to deliver positive contributions to society

Additional Stakeholder Engagements in 2020

• Proxy advisory firms

• Sustainability analyst/ratings firms

• NGOs

• Governmental institutions/agencies

• Financial institutions

• Industry groups

• Civil society organizations

• Local and regional community stakeholders

• Development institutions

• Downstream customers

Participants included our compensation committee chair who is also a member of our corporate responsibility committee, as well as senior management, including our CEO, president and chief financial officer (CFO), and members from our investor relations, corporate secretary, and ESG teams.

6 Freeport-McMoRan | 2021 Proxy Statement

SUSTAINABILITY

Freeport-McMoRan is a leading responsible copper producer. We are committed to meeting the highest standards of environmental stewardship across our operations, respecting human rights in all of our business practices and prioritizing the health, safety and well-being of our workforce and host communities where we operate. We recognize that the long-term success of the company and sustainable value creation are dependent on effective management, integration and governance of key ESG matters.

Our focus on responsible copper production is visible in everything we do, driven by our core values of safety, respect, integrity, excellence and commitment. Our values represent who we are and how we work – everyone, everywhere and every day.

By supplying responsibly produced copper, we are proud to be a positive contributor to the world well beyond our own operational boundaries.

Board Oversight and Management of Sustainability

The corporate responsibility committee (CRC), on behalf of the board, is responsible for providing advice, recommendations and oversight to the company’s management team on environmental and social matters. The CRC regularly reviews the effectiveness of management’s strategies, programs and policy implementation with respect to safety and health, responsible production frameworks, tailings management and stewardship, climate change, water stewardship, biodiversity, waste management, human capital management (including inclusion and diversity initiatives), human rights, stakeholder relations, social performance and Indigenous Peoples, responsible sourcing, and political activity and spending practices. During 2020, the CRC met three times and a member of the CRC participated directly in several stockholder engagement calls to solicit feedback on our sustainability programs and practices. Additionally, the audit committee and the governance committee conduct oversight of certain key ESG matters. The audit committee conducts oversight of global compliance, information technology security and cybersecurity. The governance committee conducts oversight of corporate governance practices and procedures.


Selected Topics Discussed during 2020 CRC Meetings
✓	COVID-19 response and human capital management	✓	Investor feedback on ESG, including expectations on climate change and SASB/TCFD reporting	✓	Indigenous Peoples and cultural heritage engagement programs
✓	Workforce safety and health (performance, incident review and corrective actions, and policy update)	✓	Human rights policy and program, including annual adoption of UK Modern Slavery Act Statement and adoption of a Responsible Sourcing of Minerals Policy	✓	Existing environmental programs and policies and potential opportunities for improvement; new 2019 climate and water reports
✓	Tailings management and the company’s leadership in the International Council on Mining & Metals’ (the ICMM) role as a co-convener of the Global Industry Standard on Tailings Management	✓	Progress on inclusion and diversity initiatives, including adoption of standalone Inclusion and Diversity Policy	✓	Social investment and charitable contributions; political spending


Our chairman and CEO has ultimate responsibility for the company’s sustainability performance. Executive officers are held accountable for the company’s sustainability performance through the company’s performance-based AIP. In 2020, ESG metrics collectively accounted for 25% of the AIP (15% safety and 10% sustainability). See “Executive Compensation – Compensation Discussion and Analysis – Principal Components of Executive Compensation” for more information.

Freeport-McMoRan | 2021 Proxy Statement 7

2020 Sustainability Highlights

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Sustainability Program Aligns with International Best Practices

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In 2020, we continued to focus on enhanced ESG transparency with the publication of an expanded sustainability report including more comprehensive five-year data and our inaugural climate report, a new water report and a new Organisation for Economic Co-operation and Development (OECD) Step 5 Report. We further enhanced our disclosures by preparing our 2020 Annual Report on Sustainability in accordance with the SASB standards for our industry, as well as the Global Reporting Initiative (GRI) Standards Core option and the G4 Mining and Metals Sector supplement. We also accelerated the timing of the publication of our 2020 Annual Report on Sustainability to align with the publication of this proxy statement to provide the latest available ESG disclosures. Our 2020 Annual Report on Sustainability, which we have published annually since 2001, is available on our website at fcx.com under “Sustainability – Reports and Documents” and is independently assured. Our 2019 Climate Report, 2019 Water Report and OECD Step 5 Reports are also available on our website at fcx.com under “Sustainability – Reports and Documents.”

In 2020, we also committed to the Copper Mark, a new, comprehensive assurance framework that promotes responsible production practices and demonstrates the industry’s contribution to the United Nations Sustainable Development Goals. It is the first and only framework developed specifically for the copper industry and enables each site to demonstrate to customers, investors, final manufacturers and other stakeholders their responsible production performance. To date, six of our sites have been validated by the Copper Mark including our Cerro Verde mine in Peru, El Abra mine in Chile, Atlantic Copper smelter and refinery in Spain, Morenci mine and Miami smelter in Arizona and El Paso refinery in Texas. We have plans to validate all of our copper producing sites against the Copper Mark requirements.

8 Freeport-McMoRan | 2021 Proxy Statement

Climate Change

In 2020, we published our inaugural climate report, established our first GHG emissions reduction target for the Americas and committed to aligning our climate strategy and related disclosures with the recommendations of the TCFD in the coming years. We formalized our climate change strategy, founded on three pillars:



PILLAR 1: REDUCTION	PILLAR 2: RESILIENCE	PILLAR 3: CONTRIBUTION
We strive to manage, mitigate and reduce our GHG emissions where possible. As a first step, we have established our first public target to reduce our GHG emissions by 15% per metric ton of copper cathode produced in the Americas by 2030, compared with our 2018 baseline.	We strive to enhance our resilience to the physical and transition risks associated with climate change for our operations, host communities and local stakeholders by working proactively to analyze and prepare for extreme weather events, water stress and other climate change impacts.	We strive to be a positive contributor beyond our operational boundaries by responsibly producing copper and molybdenum for the energy transition, including collaborating with partners in our value chain.

Later in 2021, we plan to publish an updated climate report that will include a summary of the results and recommendations from our global climate scenario analysis, which is currently underway and in line with recommendations from TCFD. We also plan to provide an update on the progress on our climate strategy. To learn more about our climate change efforts in 2020 and our plans moving forward, please refer to our 2020 Annual Report on Sustainability and our 2019 Climate Report available on our website at fcx.com under “Sustainability – Reports and Documents.”

Inclusion and Diversity

To support our workforce transformation, engagement and ongoing talent development, we strengthened our Human Resources department in 2020 and established two new positions: chief human resources officer and vice president – transformation and organizational development, which maintain specific responsibility for inclusion and diversity efforts.

We are committed to fostering a culture that is inclusive and representative of the communities where we operate. In 2020, as part of our broader organizational development efforts, we made several advancements aimed at refocusing and strengthening the governance, resourcing and strategic direction of our global inclusion and diversity program, including the following:

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Established a dedicated Human Resources team to focus solely on inclusion and diversity initiatives

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Formalized and published a new standalone Inclusion and Diversity Policy to specifically outline our expectations for behavior for promoting an inclusive culture and workforce, available in local languages on our website at fcx.com under “Sustainability – Our Approach – Policies and Practices”

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SEC Form DEF 14A filed by Freeport-McMoran, Inc.