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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Filed by a Party other than the Registrant ☐
Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material under §240.14a-12
UnitedHealth Group Incorporated
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Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

 
[MISSING IMAGE: lg_unitedhealth-pn541.jpg]
9900 Bren Road East
Minnetonka, Minnesota 55343
April 22, 2022
Dear Fellow Shareholders:
UnitedHealth Group is starting 2022 with strong momentum — well-positioned to deliver high-quality care to even more people and create greater long-term value for our shareholders and the communities we serve as we pursue our mission of helping people live healthier lives and helping the health system work better for everyone.
Combining Optum’s clinical expertise, technology and data capabilities with UnitedHealthcare’s leadership in health benefits, we are determined to help connect the fragmented pieces of the health system. Through innovations and realigning incentives, we are working in partnership with care providers, employers, and public sector leaders to help build a modern, high-performing health system and improve access, affordability, outcomes and experiences for everyone who depends on it.
Our Long-Term Growth Strategy
As an enterprise, we are prioritizing five distinct growth opportunities — which both build on our well-established, market-leading positions and further differentiate our capabilities and services to reach new markets. They are:

Care Delivery: Building a value-based system of care focused on better outcomes at lower costs; aligning patient, provider and payer incentives; and seamlessly integrating primary, specialty, urgent, post-acute and behavioral care across clinic, in-home and virtual settings.

Health Benefits: Growing our market-leading position in health benefits with a primary focus on affordable coverage, a simpler experience and high-quality, supported care.

Health Technology: Developing and deploying new technology to help modernize and simplify the health system.

Health Financial Services: Streamlining the health payments and banking experience to make it simpler, faster and more convenient for providers, payers, and consumers alike.

Pharmacy Services: Integrating our medical, pharmacy, and behavioral capabilities to provide whole-person care, support the discovery of new drugs and treatments, and offer new services.
Informed by our deep clinical expertise, these strategies present opportunities for innovation and collaboration at Optum and UnitedHealthcare — and they support our expected long term 13% to 16% earnings per share growth rate.
Ongoing Board Development
As part of its ongoing oversight, the Board reviewed committee charters and made several changes in 2021. This included assigning overall oversight for the company’s ESG agenda to the Governance Committee and having other committees oversee specific ESG elements within their purview. We also reconstituted our Public Policy Committee, now renamed the Health and Clinical Practice Policies Committee, to better reflect its expanded oversight of clinical care and practice matters and access to care, in addition to health policy matters.
In 2021, Michele Hooper became Lead Independent Director, John Noseworthy chair of the Governance Committee and Valerie Montgomery Rice chair of the Health and Clinical Practice Policies Committee. In November, Paul Garcia, retired chairman and CEO of Global Payments, joined the Board, bringing additional executive operating experience and technological, payments and financial expertise as well as advancing the diversity of the Board.
Two of our directors, Richard Burke and Gail Wilensky, are not standing for re-election this year and will retire as of the Annual Meeting following extraordinary and distinguished service to the company and shareholders. We are deeply grateful to Mr. Burke and Dr. Wilensky for their leadership. We benefited greatly from their insights, experience, and
 

 
guidance. The Board continues to assess its composition to ensure that it has the balance of skills and operating experience needed to oversee long-term strategy and provide effective oversight.
Advancing our Efforts in Sustainability & ESG
As a mission-driven company, we are committed to using our reach and resolve to help ensure everyone has access to high-quality, affordable care when and where it is needed. We see the intrinsic societal value of primary and preventive care and ensuring physicians have the resources, tools and support they need to keep their patients healthy — helping people live longer and more fulfilling lives while reducing cost in the system for everyone. To support our growing focus on sustainability, the company created the role of Chief Sustainability Officer, responsible for helping develop a comprehensive ESG strategy, including annual and long-term sustainability goals and a governance structure to achieve them.
Shareholder Meeting details
As a shareholder of UnitedHealth Group, your continued feedback is important to our company. We cordially invite you to participate in our 2022 Annual Meeting of Shareholders to be held on Monday, June 6, 2022, at 11:00 a.m. Eastern Time. We will once again hold our meeting virtually.
Attached you will find a notice of meeting and proxy statement containing information about the items upon which you will be asked to vote and the meeting itself, including different methods you can use to vote your proxy, including by internet, telephone and mail. Every shareholder vote is important, and we encourage you to vote as promptly as possible. Instructions on how to participate in the Annual Meeting are included in the proxy statement.
On behalf of UnitedHealth Group’s Board and management team, we appreciate your continued trust and support.
Sincerely,
[MISSING IMAGE: sg_andrewwitty-bw.jpg]
[MISSING IMAGE: sg_stephenhemsleynew-bw.jpg]
Andrew Witty
Chief Executive Officer
Stephen Hemsley
Chair of the Board
 

 
2022 Notice of Annual Meeting
Items of Business

Proposal 1: Elect the eight nominees set forth in the attached proxy statement to the Company’s Board of Directors.

Proposal 2: Conduct an advisory vote to approve the compensation paid to the Company’s named executive officers as disclosed in the attached proxy statement (a “Say on Pay”) vote.

Proposal 3: Ratify the appointment of Deloitte & Touche LLP as the independent registered public accounting firm for the Company for the year ending December 31, 2022.

Proposals 4 and 5: Consider the shareholder proposals set forth in the attached proxy statement, if properly presented at the Annual Meeting.
Items of business may also include transacting any other business that properly come before the Annual Meeting or any adjournments or postponements of the meeting. Proxy materials are first being mailed to our shareholders and made available at www.unitedhealthgroup.com/proxymaterials on or about April 22, 2022. Website addresses included throughout this proxy statement are for reference only. The information contained on our website is not incorporated by reference into this proxy statement.
Access to the Annual Meeting
The 2022 Annual Meeting will be held in virtual format only. If you plan to participate in the Annual Meeting, please see the “Questions and Answers About the Annual Meeting and Voting” section in the attached proxy statement. Shareholders will be able to participate in, vote, view the list of shareholders of record and submit questions from any location.
Proxy Voting
Important. Even if you plan to participate in the Annual Meeting, we still encourage you to submit your proxy by internet, telephone or mail prior to the meeting. If you later choose to revoke your proxy or change your vote, you may do so by following the procedures under Question 12 of the “Questions and Answers About the Annual Meeting and Voting” section in the attached proxy statement.
June 6, 2022
11:00 a.m. Eastern Time
Our Annual Meeting can
be accessed virtually at:
www.virtualshareholder
meeting.com/UNH2022
Record Date
April 8, 2022
Only shareholders of record of the Company’s common stock at the close of business on the record date are entitled to receive notice of, and to vote at, the Annual Meeting and any adjournments or postponements of the meeting.
IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD VIRTUALLY VIA THE INTERNET ON JUNE 6, 2022:
The Notice of Internet Availability of Proxy Materials, Notice of Annual Meeting of Shareholders, Proxy Statement and Annual Report are available at www.unitedhealthgroup.com/
proxymaterials.
 

 
Table of Contents
1
Board of Directors
4
4
8
12
13
13
16
16
17
17
20
Corporate Governance
22
24
24
25
26
Executive Compensation
29
32
47
48
48
51
53
54
55
56
57
59
61
Audit
62
64
64
64
65
Annual Meeting
66
69
72
79
79
Other Information
80
82
84
 

Proxy Summary
Business Results
We are a diversified health care company with a mission to help people live healthier lives and help make the health system work better for everyone. Our two distinct, yet complementary business platforms — Optum and UnitedHealthcare — are working to help build a modern, high-performing health system through improved access, affordability, outcomes and experiences for the individuals and organizations we are privileged to serve. The breadth and scope of our diversified company help to consistently improve health care quality, access and affordability. We again performed strongly in 2021.
Financial

Total shareholder return in 2021 was 45%, and 107% from 2019-2021, reflecting continued strong fundamental performance;

Revenues increased 12% to $287.6 billion in 2021 from $257.1 billion in 2020;

Net earnings increased 12% year-over-year to $17.3 billion; operating earnings increased 7% year-over-year to $24.0 billion; and cash flows from operations were $22.3 billion in 2021;

Fully diluted earnings per share increased 13% to $18.08 per share from $16.03 in 2020. Adjusted earnings per share1 increased 13% to $19.02 per share from $16.88 per share in 2020;

Return on equity at 25.2% in 2021 compared to 24.9% in 2020, reflecting the Company’s strong operating performance and efficient capital structure; and

The annual cash dividend rate increased to $5.80 per share, representing a 16% increase over the annual cash dividend rate of $5.00 per share since the second quarter of 2020.
Awards and Recognition

UnitedHealth Group was the top ranked company in the insurance and managed care sector on Fortune’s 2022 “World’s Most Admired Companies” list. This is the twelfth consecutive year UnitedHealth Group has ranked No. 1 overall in its sector. The Company ranked No. 1 on all nine key attributes of reputation — innovation, people management, use of corporate assets, social responsibility, quality of management, financial soundness, long-term investment value, quality of products and services and global competitiveness;

UnitedHealth Group has been named to both the Dow Jones Sustainability World and North America Indices every year since 1999;

UnitedHealth Group received a score of 100 on the Human Rights Campaign Foundation’s Corporate Equality Index 2022, earning the distinction of one of the “Best Places to Work for LGBTQ Equality”;

In 2021, and for the tenth consecutive year, The Civic 50, a Points of Light initiative that highlights companies that improve the quality of life in the communities where they do business, ranked UnitedHealth Group one of America’s 50 most community-minded companies. In addition, UnitedHealth Group was named the leader in the Healthcare Sector category for the fourth time overall;

UnitedHealth Group was named to Forbes’ list of 2021 World’s Best Employers;

Prospanica, an organization that has worked to empower Hispanic professionals for over 30 years, recognized UnitedHealth Group with the 2021 Brillante Award for Corporate Excellence;

The CDP (formerly Carbon Disclosure Project) named UnitedHealth Group to its Leadership Band in 2020 for efforts to reduce greenhouse gas emissions;

The Disability Equality Index® named UnitedHealth Group one of the best places to work for disability inclusion in 2021;

UnitedHealth Group has been ranked No. 4 in the nation on the 2022 Military Friendly® Employers list; and

UnitedHealth Group is recognized as a “Trendsetter” in the 2021 Center for Political Accountability-Zicklin Index of Political Accountability.
1
Adjusted earnings per share is a non-GAAP financial measure. Refer to Appendix A in this proxy statement for a reconciliation of adjusted earnings per share to the most directly comparable GAAP measure.
 
2022 Proxy Statement   |   Proxy Summary
1

Corporate Governance
UnitedHealth Group is committed to meeting high standards of ethical behavior, corporate governance and business conduct. Our company, our Board of Directors (the “Board”) and our people are committed to the shared cultural values of integrity, compassion, innovation, relationships and performance. This commitment has led us to implement many governance best practices.
Board Structure and Composition
Our directors are elected annually by a majority vote of our shareholders. Each nominee tenders an irrevocable offer to resign in case they do not receive a majority vote from shareholders at the annual meeting. Our current Board structure separates the positions of Chair of the Board and CEO. We have a Lead Independent Director, and six of our eight director nominees are independent.
Public Company Board Service Limits
Our directors may serve on no more than three other public company boards and our CEO may serve on no more than one other public company board.
One Share, One Vote
The Company does not have a dual-class share structure. Each share of Company common stock is entitled to one vote.
Proxy Access
A shareholder or group of shareholders who have owned at least 3% of our common stock for at least three years, and who comply with specified procedural and disclosure requirements, may include in our proxy materials shareholder-nominated director candidates representing up to 20% of the Board.
Board Succession Planning, Tenure and Diversity
Since January 2017, seven new directors have been appointed to our diverse and deeply experienced Board, including the addition of Paul Garcia in November 2021. Six of these new directors are standing for election this year, five of whom are independent, advancing both the skill and experience profile of the Board as well as its diversity. Two directors are not standing for re-election.
Chief Executive Officer Succession Planning
Our succession plan, which is reviewed annually by our Board, addresses both an unexpected loss of our CEO and longer-term succession.
ESG Oversight
Our Board provides robust oversight over ESG topics, as codified in our Board Committee charters.
Absence of Rights Plan
We do not have a shareholder rights plan, commonly referred to as a “poison pill.”
Shareholder Special Meeting and Written Consent Rights
Shareholders hold the right to call a special meeting and to act by written consent.
Prohibition on Short Sales, Hedging and Pledging Transactions in Company Securities
Our insider trading policy prohibits all directors, executive officers and employees from engaging in short sales and hedging transactions relating to our common stock. Additionally, our insider trading policy prohibits directors and executive officers from engaging in pledging transactions.
Stock Ownership Guidelines
All of our executive officers and directors were in compliance with our stock ownership guidelines as of April 8, 2022.
Stock Retention Policy
We require executive officers to hold, for at least one year, one-third of the net shares acquired upon vesting or exercise of any equity award. Our directors are required to hold all equity awards granted until completion of service on the Board, or until they have met our stock ownership requirements.
Clawback Policy
Our clawback policy entitles the Board to seek cash or equity reimbursement from our senior executives if they are directly involved in fraud or misconduct causing a material restatement, material detrimental conduct or violate non-compete, non-solicit or confidentiality provisions.
Political Contributions Disclosure
We publicly disclose our political contributions and public advocacy efforts and the contributions of our federal and state political action committees.
See the “Corporate Governance” portion of this proxy statement for further information on our governance practices.
 
2022 Proxy Statement   |   Proxy Summary
2

Executive Compensation
Our executive compensation program uses a mix of base salary, annual cash incentives, equity awards and broad-based benefits to attract and retain highly qualified executives and maintain a strong alignment between executive pay and Company performance. Information regarding compensation paid to each of our named executive officers in 2021 is described in the “Executive Compensation” section.
Addressing the 2021 Say on Pay Vote
Having received 72% support for our 2021 say on pay vote, we sought feedback from shareholders to better understand what motivated their votes and what actions we could take to address topics relating to our executive compensation program. The following summarizes key feedback received and responsive actions we have taken related to executive compensation:

We were pleased to hear shareholders indicate their strong support of the overall design of our executive compensation program as well as the Company’s overall pay-for-performance philosophy. Shareholders overwhelmingly did not indicate a desire for broad changes to our program design;

Our Compensation and Human Resources Committee has confirmed that it has no intention of paying severance in connection with the retirement of an executive officer going forward;

Broadened our clawback policy to include material detrimental conduct as a trigger;

Enhanced our disclosure on the non-financial metrics included in the annual incentive plan; and

Enhanced our disclosure of the rationale for executive compensation targets.
The Board appreciates feedback provided by shareholders. Additional information on the feedback provided and responsive actions taken may be found beginning on page 33 of this proxy statement.
COVID-19 Response
Throughout the COVID-19 pandemic, UnitedHealth Group has worked tirelessly to ensure the stability of the health system and the health and safety of every individual we serve — our patients, members and customers as well as our colleagues and their families. From providing billions of dollars in advance payments to providers and premium credits and cost-sharing waivers to customers and consumers; to providing COVID-19 testing services to several states; to providing more than $100 million in support to those affected by COVID-19, we were honored to bring the combined resources of UnitedHealth Group, UnitedHealthcare and Optum and the compassion and commitment of our 340,000 team members in the fight against COVID-19. As the pandemic enters a new stage and society begins to emerge from this crisis, UnitedHealth Group will continue working with our many partners across the health system to use the lessons learned over the past two years to guide our business as we seek to ensure equitable access to high-quality, affordable, and convenient care for everyone.
Voting Matters and Vote Recommendations
Items of Business
Board’s Recommendation
Details
1 Election of Eight Directors
FOR
Page 4
2 Advisory Approval of Executive Compensation
FOR
Page 61
3 Ratification of Independent Registered Public Accounting Firm
FOR
Page 65
4 Shareholder Proposal Seeking Shareholder Ratification of Termination Pay
AGAINST
Page 66
5 Shareholder Proposal Regarding Political Contributions Congruency Report
AGAINST
Page 69
 
2022 Proxy Statement   |   Proxy Summary
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1
Board of
Directors
2
Corporate
Governance
3
Executive
Compensation
4
Audit
5
Annual
Meeting
6
Other
Information
Board of Directors
PROPOSAL 1: Election of Directors
Our Board of Directors has nominated eight directors for election at the 2022 Annual Meeting to hold office until the next annual meeting and the election of their successors. All of the nominees are currently directors and have agreed to be named in this proxy statement and to serve if elected. After many years of exceptional service to the Board, Mr. Burke and Dr. Wilensky are not standing for election this year.
In accordance with our Principles of Governance, each nominee has also tendered an irrevocable offer to resign as a director, which will become effective if the director fails to receive a majority vote for election at the Annual Meeting and our Board accepts the director’s offer to resign. Please see the “Corporate Governance” section of this proxy statement for additional details on this policy. All of the nominees are expected to attend the 2022 Annual Meeting. All then-current directors attended the 2021 Annual Meeting. We ask for your voting support for each of the director nominees at our 2022 Annual Meeting.
2022 Director Nominees
The following is a brief biographical description of each director nominee. A matrix listing the skills and areas of expertise held by each director and which, in part, led the Board to conclude each respective director should continue to serve as a member of the Board, is included on page 9.
The Board of Directors recommends you vote FOR the election of each of the nominees. Executed proxies will be voted FOR the election of each nominee unless you specify otherwise.
Director
Age
Primary Occupation
Director
Since
Timothy P. Flynn
65
Former Chair, KPMG International
2017
Paul R. Garcia
69
Retired Chair and Chief Executive Officer, Global Payments
2021
Stephen J. Hemsley
69
Chair, UnitedHealth Group
2000
Michele J. Hooper
70
President and CEO, The Directors’ Council
2007
F. William McNabb III
65
Former Chairman and CEO, The Vanguard Group, Inc.
2018
Valerie C. Montgomery Rice, M.D.
60
President and Dean, Morehouse School of Medicine
2017
John H. Noseworthy, M.D.
70
Former CEO and President, Mayo Clinic
2019
Andrew Witty
57
CEO, UnitedHealth Group
2021
2022 Proxy Statement   |   Proposal 1: Election of Directors   |   2022 Director Nominees
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1
Board of
Directors
2
Corporate
Governance
3
Executive
Compensation
4
Audit
5
Annual
Meeting
6
Other
Information
Timothy P. Flynn
Mr. Flynn was Chairman of KPMG International (“KPMG”), a global professional services organization that provides audit, tax and advisory services, from 2007 until his retirement in October 2011. From 2005 until 2010, he served as Chairman and from 2005 to 2008 as CEO of KPMG LLP in the U.S., the largest individual member firm of KPMG. Prior to serving as Chairman and CEO of KPMG LLP, Mr. Flynn was Vice Chairman, Audit and Risk Advisory Services, with operating responsibility for Audit, Risk Advisory and Financial Advisory Services practices at KPMG LLP. He previously served as a trustee of the Financial Accounting Standards Board, a member of the World Economic Forum’s International Business Council, and as a director of Alcoa and the International Integrated Reporting Council.
Director since: 2017
Age: 65
Committees:
Compensation and Human
Resources (Chair)
Governance
Current Outside Public
Directorships:
JPMorgan Chase & Co.
Walmart Inc.
Paul R. Garcia
Mr. Garcia is the retired Chairman and Chief Executive Officer of Global Payments Inc., a publicly traded, leading provider of electronic payment processing services, and served in that capacity from 1999 to 2014. Prior to his role at Global Payments, Mr. Garcia served as President & CEO of NaBanco, an electronic credit card processor, from 1982 to 1995. Mr. Garcia currently serves as a director of Deluxe Corporation and Repay Holdings Corporation. He has also served on the board of directors of Global Payments Inc. and MasterCard International and, in the past five years, served as a director of The Dun & Bradstreet Corporation, West Corporation, Truist Financial Corporation and Payment Alliance International, Inc.
Director since: 2021
Age: 69
Committees:
Audit and Finance
Current Outside Public
Directorships:
Deluxe Corporation
Repay Holdings Corporation
Stephen J. Hemsley
Mr. Hemsley is non-executive Chair of the Board of UnitedHealth Group and has served in this capacity since November 2019. Mr. Hemsley previously served as Executive Chair of the Board from September 2017 to November 2019, Chief Executive Officer from November 2006 to August 2017, President from May 1999 to November 2014, and Chief Operating Officer from November 1998 to November 2006. He joined the Company in 1997 and has been a member of the Board of Directors since 2000. Mr. Hemsley currently serves as a director of Cargill, Inc.
Director since: 2000
Age: 69
Committees:
Health and Clinical Practice
Policies
Current Outside Public
Directorships:
None
2022 Proxy Statement   |   2022 Director Nominees
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Board of
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Executive
Compensation
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Audit
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Annual
Meeting
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Other
Information
Michele J. Hooper
Ms. Hooper is Lead Independent Director of the Board of Directors of UnitedHealth Group and has served in this capacity since October 2021. Ms. Hooper is also President and CEO of The Directors’ Council, a private company she co-founded in 2003 that works with corporate boards to increase their independence, effectiveness and diversity. She was President and CEO of Voyager Expanded Learning, a developer and provider of learning programs and teacher training for public schools, from 1999 until 2000. She previously served as President and CEO of Stadtlander Drug Company, Inc., a provider of disease-specific pharmaceutical care, from 1998 until Stadtlander was acquired in 1999. Ms. Hooper is a nationally recognized corporate governance expert. In the past five years, Ms. Hooper also served as a director of PPG Industries, Inc.
Director since: 2007
Age: 70
Committees:
Audit and Finance
Current Outside Public Directorships:
United Airlines Holdings, Inc.
F. William McNabb III
Mr. McNabb served as Chairman of The Vanguard Group, Inc. from 2010 until his retirement in 2018 and served as CEO from 2008 to 2017. He joined Vanguard in 1986. In 2010, he became Chairman of the Board of Directors and the Board of Trustees of the Vanguard group of investment companies. Earlier in his career, Mr. McNabb led each of Vanguard’s client facing business divisions. Mr. McNabb is active in the investment management industry and served as the Chairman of the Investment Company Institute’s Board of Governors from 2013 to 2016. Mr. McNabb is Chairman of the Board of the Zoological Society of Philadelphia and serves on the Wharton Leadership Advisory Board, the Dartmouth Athletic Advisory Board and the Columbia Law School’s Millstein Center Advisory Board. Mr. McNabb is a board member of CECP: The CEO Force for Good.
Director since: 2018
Age: 65
Committees:
Audit and Finance (Chair)
Governance
Current Outside Public
Directorships:
International Business
Machines Corporation
2022 Proxy Statement   |   2022 Director Nominees
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1
Board of
Directors
2
Corporate
Governance
3
Executive
Compensation
4
Audit
5
Annual
Meeting
6
Other
Information
Valerie C. Montgomery Rice, M.D.
Dr. Montgomery Rice is President and Chief Executive Officer of the Morehouse School of Medicine, a medical school in Atlanta, Georgia. She has served as President since 2014 and as Chief Executive Officer since 2021. She also served as Dean of the Morehouse School of Medicine from 2011 to 2021 and as Executive Vice President from 2011 to 2014. Morehouse School of Medicine is among the nation’s leading educators of primary care physicians and was recently recognized as the top institution among U.S. medical schools for its social mission. Prior to joining Morehouse School of Medicine, she served as Dean of the School of Medicine and Senior Vice President of Health Affairs at Meharry Medical College from March 2006 to June 2009, and as director of the Center for Women’s Health Research, one of the nation’s first research centers devoted to studying diseases that disproportionately impact women of color, from 2005 to 2011. Dr. Montgomery Rice also served previously as a Council Member of the National Institute of Health and National Center for Advancing Translational Science, and previously on the National Institute of Health’s Minority Health and Health Disparities and Office of Research on Women’s Health advisory councils, and the Association of American Medical Colleges Council of Deans administrative board. Dr. Montgomery Rice is a member of the National Academy of Medicine and a renowned infertility specialist and women’s health researcher.
Director since: 2017
Age: 60
Committees:
Health and Clinical Practice
Policies (Chair)
Compensation and Human
Resources
Current Outside Public
Directorships:
23andMe Holding Co.
John H. Noseworthy, M.D.
Dr. Noseworthy is the former Chief Executive Officer and President of Mayo Clinic, a world renowned health care organization. He retired at the end of 2018 after a 28 year career at Mayo Clinic, recognized by U.S. News and World Report as best in its honor roll of America’s top providers of care for patients with serious and complex problems. Mayo Clinic cares for patients in every U.S. state and 143 countries worldwide. Dr. Noseworthy joined Mayo Clinic in 1990 and served in various capacities, including as Chairman of Mayo Clinic’s internal Board of Governors, member of the Board of Trustees, Professor of Neurology at Mayo Clinic College of Medicine & Science, Chair of Mayo’s Department of Neurology, medical director of the Department of Development and Vice Chair of the Mayo Clinic Rochester Executive Board. Dr. Noseworthy also served as editor-in-chief of Neurology, the official journal of the American Academy of Neurology, from 2007 to 2009. Dr. Noseworthy was a Health Governor of the World Economic Forum from 2012 to 2018 and, in the past five years, also served as a director of Merck & Co.
Director since: 2019
Age: 70
Committees:
Compensation and Human
Resources Health and Clinical Practice Policies Governance (Chair)
Current Outside Public
Directorships:
None
2022 Proxy Statement   |   2022 Director Nominees
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Compensation
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Annual
Meeting
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Other
Information
Andrew Witty
Mr. Witty is Chief Executive Officer of UnitedHealth Group and has served in that capacity since February 2021. He was President of UnitedHealth Group from November 2019 to February 2021, Chief Executive Officer of Optum from July 2018 to April 2021, and a UnitedHealth Group director from August 2017 to March 2018. Prior to joining UnitedHealth Group, he was Chief Executive Officer and a board member of GlaxoSmithKline, a global pharmaceutical company, from 2008 to April 2017.
Director since: 2021
Age: 57
Committees:
None
Current Outside Public
Directorships:
None
Director Nomination Process
Criteria for Nomination to the Board
Our Board’s Governance Committee assesses the optimal skills, experiences, and attributes our Board should represent to align its individual and group strengths with our Company’s long-term strategic plan and the interests of our shareholders and stakeholders.
The skills matrix has two sections — a list of core criteria every member of the Board should meet and a list of skills and attributes to be represented collectively by the Board. The core director criteria are:

Independence under the Company’s Standards for Director Independence and New York Stock Exchange (“NYSE”) listing requirements, subject to waiver by the Governance Committee;

Service on no more than three other public company boards; except our Chief Executive Officer may serve on no more than one other public company board;

High integrity and ethical standards;

Standing and reputation in the individual’s field;

Ability to oversee risks within the individual director’s particular skill set;

Understanding of and experience with complex public companies or like organizations; and

Ability to work collegially and collaboratively with other directors and management.
Each of our independent director nominees has satisfied all the core director criteria set forth in the skills matrix.
All of the director nominees were elected by our shareholders at the 2021 Annual Meeting except Mr. Garcia, who was appointed unanimously by the Board in November 2021. With respect to that appointment, the Governance Committee considered a number of potential candidates and Mr. Garcia emerged as the finalist due to his overall skill set and experience. Mr. Garcia was initially recommended as a potential director candidate by an external consulting firm.
2022 Proxy Statement   |   Director Nomination Process
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Executive
Compensation
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Audit
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Annual
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Other
Information
Optimal Mix of Skills and Expertise of Director Nominees
The skills matrix provides a number of substantive areas of expertise the Board as a whole should represent. The following table includes a list of these areas and the director nominees with expertise in each area.
Director
Corporate
Governance
Finance
Health
Care
Industry
Direct
Consumer
Markets
Social
Media/
Marketing
Diversity
Experience
with
Large
Complex
Organizations
Technology/
Business
Processes
Clinical
Practice
Political/
Health
Care
Policy/
Regulatory
Capital
Markets
Timothy P. Flynn
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Paul R. Garcia
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Stephen J. Hemsley
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Michele J. Hooper
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F. William McNabb III
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Valerie C. Montgomery Rice, M.D.
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John H. Noseworthy, M.D.
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Andrew Witty
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Tenure of Director Nominees
Our Governance Committee strives to maintain a balance of tenure on the Board. Long-serving directors bring valuable experience with our Company and familiarity with the successes and challenges the enterprise has faced over the years, while newer directors contribute fresh perspectives. Upon the election of the director nominees presented in this proxy statement, the average tenure of our Board will be 6.6 years following the 2022 annual meeting.
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2022 Proxy Statement   |   Director Nomination Process
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Board of
Directors
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Corporate
Governance
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Executive
Compensation
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Audit
5
Annual
Meeting
6
Other
Information
Board Diversity
UnitedHealth Group embraces and encourages a culture of inclusion and diversity. Valuing diversity makes good business sense and helps to ensure our future success, because the customers, clients, and consumers we serve are as diverse as the thousands of communities where we live and work across all 50 states in the U.S. and 150 other countries. While our Board does not establish specific goals with respect to diversity, the Board’s diversity is a consideration in the director nomination process and is assessed annually when the Board evaluates its overall effectiveness. We are committed to actively seeking women and racially/ethnically diverse director candidates. The Governance Committee maintains an active recruiting pipeline of potential director candidates based upon skills identified in our skills matrix and includes diverse candidates.
Recent Changes in Board Membership
Additions
Departures
2021
2019
2018
2017
2022
2021
2020
2018
2017
Andrew
Witty(1)
Paul R.
Garcia
John H.
Noseworthy, M.D.
F. William
McNabb III
Timothy P.
Flynn
Valerie C.
Montgomery
Rice, M.D.
Andrew
Witty(1)
David S.
Wichmann
Richard T.
Burke
Gail R.
Wilensky, Ph.D.
Mr. Burke and
Dr. Wilensky
are not Standing for
Re-Election at
the Annual
Meeting
David S.
Wichmann
Glenn M.
Renwick
William C.
Ballard, Jr.
Andrew
Witty(1)
Kenneth I.
Shine, M.D.
Rodger A.
Lawson
Robert J.
Darretta
(1)
Andrew Witty first joined the Board as an independent director in August 2017, stepped down in March 2018 to serve as CEO of Optum and rejoined the Board in connection with his appointment as the Company’s CEO in February 2021.
Our current slate of director candidates reflects the retirement of two highly-successful and longstanding directors and the addition of a new diverse director in 2021. In October 2021, Michele Hooper was appointed Lead Independent Director. These changes to our Board composition have reduced our average and individual director tenure, and reflect the Board’s ongoing succession planning.
For this year’s election, the Board has nominated eight individuals. All are incumbent directors who collectively bring tremendous diversity to the Board in terms of professional experience, skills and background, as well as diversity of nationality, race and gender. Each nominee is a strategic thinker and has varying, specialized experience in the areas relevant to the Company and its businesses. Moreover, their collective experience covers a wide range of industries, including health care and clinical practice, insurance, consumer products, technology, capital markets and financial services, and roles in academia, corporate governance, government and intergovernmental organizations. The eight director nominees range in age from 57 to 70; two of the eight director nominees are women; two are African American; one is Hispanic; one is a citizen of Canada and one is a citizen of the United Kingdom.
2022 Proxy Statement   |   Director Nomination Process
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Corporate
Governance
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Executive
Compensation
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Annual
Meeting
6
Other
Information
Search Process for New Directors
The Governance Committee screens and recommends candidates for nomination by the full Board. We have for several years maintained an active “evergreen” director candidate pipeline which reflects our continuing commitment to diversity in life, cultural and business experience among director nominees. The Governance Committee will also consider recommendations submitted by shareholders for director candidates. Recommendations should be directed to the Secretary to the Board of Directors. None of the Company’s shareholders recommended candidates for the Board of Directors in connection with the 2022 Annual Meeting.
Prior to the appointment of each of the new independent directors beginning in 2017, the Governance Committee considered a wide slate of potential candidates, including qualified women and racially/ethnically diverse candidates. Each eventual nominee was selected due to his or her overall skills and experience.
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Nominating Advisory Committee
The Board of Directors formed the Nominating Advisory Committee in 2006 to provide the Governance Committee with additional input from shareholders and others regarding desirable characteristics of director candidates and the composition of the Board of Directors. The key features of the skills matrix are also discussed with members of our Nominating Advisory Committee and their feedback is considered by the Governance Committee when it updates the skills matrix. The Governance Committee considers, but is not bound by, input provided by the Nominating Advisory Committee. The Nominating Advisory Committee includes four individuals affiliated with long-term shareholders of the Company and one individual who is a member of the medical community. Members of the Nominating Advisory Committee do not receive any compensation from the Company for serving on the Nominating Advisory Committee. The Nominating Advisory Committee met once in 2021. A description of the Nominating Advisory Committee, including a description of how the members of the Nominating Advisory Committee are nominated and selected, can be found on our website at www.unitedhealthgroup.com/who-we-are/corporate-governance.
Shareholder Director Candidates for Inclusion in our Proxy Statement (Proxy Access)
Our Bylaws provide a shareholder or group of shareholders (of up to 20) who have owned at least 3% of our common stock for at least three years the ability to include in our proxy statement shareholder-nominated director candidates for up to 20% of the Board. To be eligible to use this right, the shareholder(s) and the candidate(s) must satisfy the requirements specified in our Bylaws. Our Bylaws are available at www.unitedhealthgroup.com/who-we-are/corporate-governance. For the 2023 Annual Meeting, director nominations submitted under these Bylaw provisions must be received at our principal executive offices, directed to the Secretary to the Board of Directors, no earlier than November 23, 2022 and no later than December 23, 2022.
2022 Proxy Statement   |   Director Nomination Process
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Board of
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Corporate
Governance
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Executive
Compensation
4
Audit
5
Annual
Meeting
6
Other
Information
Shareholder Nominations of Director Candidates at an Annual Meeting
Our shareholders may also nominate candidates for election to the Board at our Annual Meeting of Shareholders, instead of including the director candidate in our proxy statement, by submitting timely written notice to the Secretary to the Board in accordance with our Bylaws. The notice must include the information required by our Bylaws, which are available at www.unitedhealthgroup.com/who-we-are/corporate-governance. For the 2023 Annual Meeting, this notice must be received at our principal executive offices, directed to the Secretary to the Board of Directors, no earlier than
February 6, 2023 and no later than March 8, 2023.
Board Leadership Structure
Our Board of Directors believes having independent Board leadership is an important component of our governance structure. As such, our Bylaws require the Company to have either an independent Chair of the Board or a Lead Independent Director. In October 2021, Michele Hooper was appointed Lead Independent Director, succeeding Richard Burke.
Our Board’s leadership structure also separates the positions of CEO and Chair of the Board. The Board believes this separation is appropriate for the Company at this time because it allows for a division of responsibilities and a sharing of ideas between individuals having different perspectives. The Board will continue to evaluate the Board structure on an ongoing basis.
Our Principles of Governance outline the specific duties of the Lead Independent Director, including:

serving as the principal liaison between the independent directors and the Chair of the Board;

presiding at all meetings of the Board at which the Chair of the Board is not present and at executive sessions of the Board’s independent directors;

calling meetings of the independent directors as appropriate and, in coordination with the Chair of the Board, all members of the Board;

facilitating discussion and open dialogue among the independent directors during Board meetings, executive sessions and outside of Board meetings;

serving as an ex officio member of each Board committee of which the Lead Independent Director is not a member and working with the Board committee chairs on the performance of their designated roles and responsibilities;

working with the Chair of the Board to approve the agendas and meeting schedules for Board meetings;

working with the Chair of the Board on the appropriateness (including quality and quantity) and timeliness of information provided to the Board;

meeting individually with the Chair of the Board after each regularly scheduled Board meeting;

coordinating the preparation of agendas and materials for executive sessions of the Board’s Independent Directors, if any;

assisting the Chair of the Governance Committee in reviewing and reporting on the results of the Board and committee performance self-evaluations;

communicating to the Chair of the Board any decisions reached, suggestions, views or concerns expressed by Independent Directors in executive sessions or outside of Board meetings;

meeting periodically with individual independent directors to discuss Board and committee performance, effectiveness and composition;
2022 Proxy Statement   |   Board Leadership Structure
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Compensation
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Information

where appropriate, supporting the Company in interactions with shareholders and regulators in consultation with the Chief Executive Officer and Chair of the Board; and

interviewing, along with the Chair of the Governance Committee, all Board candidates and making director
candidate recommendations to the Governance Committee.
Director Independence
Our Board of Directors has adopted the Company’s Standards for Director Independence, which are available at www.unitedhealthgroup.com/who-we-are/corporate-governance. The Standards for Director Independence requirements exceed the independence standards set by the NYSE.
Our Board of Directors has determined director nominees Timothy P. Flynn, Paul R. Garcia, Michele J. Hooper, F. William McNabb III, Valerie C. Montgomery Rice, M.D., and John H. Noseworthy, M.D., are each “independent” under the NYSE rules and the Company’s Standards for Director Independence, and have no material relationships with the Company that would prevent the directors from being considered independent.
In accordance with the Company’s Standards for Director Independence, the Board of Directors considered, among other factors, the business relationships between the Company and our directors and nominees, their immediate family members (as defined by the NYSE) and their affiliated companies. The Board of Directors considered whether any director or any nominee was a director, partner, significant shareholder or executive officer of an organization that has a relationship with the Company, and also considered charitable contributions the Company or its affiliates made to organizations with which such directors or nominees are or have been associated. In particular, the Board of Directors evaluated the following relationships and determined such relationships were in the normal course of business and did not impair the directors’ ability to exercise independent judgment:

Dr. Montgomery Rice is President and Chief Executive Officer of Morehouse School of Medicine. In 2021, Morehouse School of Medicine paid the Company approximately $212,700 for claims software, equipment, maintenance licenses and subscriptions. The Company paid Morehouse School of Medicine approximately $642,900 for services as a network care provider and approximately $595,000 for health care related studies. Total amounts paid by the Company to Morehouse School of Medicine during 2021 were substantially less than 1% of Morehouse School of Medicine’s total revenues for 2021. Dr. Montgomery Rice was not directly involved in these relationships.

Mr. Flynn’s brother is President and Chief Executive Officer of Sightpath Medical. Sightpath Medical paid the Company approximately $1.5 million for premium payments in 2021. Total amounts paid by Sightpath Medical to the Company during 2021 were less than 2% of Sightpath Medical’s total revenues for 2021. Mr. Flynn was
not directly involved in this relationship.
Board Committees
The Board of Directors has established four standing committees as listed in the table below. These committees help the Board fulfill its responsibilities and assist the Board in making informed decisions. Each committee operates under a written charter, and evaluates its charter and conducts a committee performance evaluation annually.
2022 Proxy Statement   |   Director Independence   |   Board Committees
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Board of
Directors
2
Corporate
Governance
3
Executive
Compensation
4
Audit
5
Annual
Meeting
6
Other
Information
The following table identifies the members of each committee as of April 8, 2022:
Director
Audit and
Finance
Compensation
and Human
Resources
Governance
Health and
Clinical Practice
Policies
Timothy P. Flynn
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Paul R. Garcia
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Stephen J. Hemsley
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Michele J. Hooper
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F. William McNabb III
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Valerie C. Montgomery Rice, M.D.
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John H. Noseworthy, M.D.
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Andrew Witty
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Chair
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Member
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Financial Expert
*
Ms. Hooper is our Lead Independent Director and an ex-officio member of the Compensation and Human Resources Committee, Governance Committee and Health and Clinical Practice Policies Committee. As an ex-officio member, Ms. Hooper has a standing invitation to attend each committee meeting, but does not count for quorum purposes or vote on committee matters.
Audit and Finance Committee
Meetings Held in 2021: 10
Committee Members:
F. William McNabb III (Chair), Michele J. Hooper and Paul R. Garcia
Primary Responsibilities:
The Audit and Finance Committee has responsibility for the selection and retention of the independent registered public accounting firm and oversees financial reporting, internal controls and public disclosure. The Audit and Finance Committee reviews and assesses the effectiveness of the Company’s policies, procedures and resource commitments in the areas of compliance, ethics, privacy and cyber security. The Audit and Finance Committee also oversees management’s processes to identify and quantify material risks facing the Company, management’s investing and financing policies and practices, ESG investment criteria, and assurance of ESG disclosures. The Audit and Finance Committee establishes procedures concerning the receipt, retention and treatment of complaints regarding accounting, internal accounting controls and auditing matters. The Audit and Finance Committee operates as a direct line of communication between the Board of Directors and our independent registered public accounting firm, as well as our internal audit, compliance and legal personnel.
Independence:
Each of the Audit and Finance Committee members is an independent director under the NYSE listing standards and the SEC rules. The Board of Directors has determined Mr. McNabb, Ms. Hooper and Mr. Garcia are “audit committee financial experts” as defined by the SEC rules.
2022 Proxy Statement   |   Board Committees
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Corporate
Governance
3
Executive
Compensation
4
Audit
5
Annual
Meeting
6
Other
Information
Compensation and Human Resources Committee
Meetings Held in 2021: 6
Committee Members:
Timothy P. Flynn (Chair), Valerie C. Montgomery Rice, M.D. and John H. Noseworthy, M.D.
Primary Responsibilities:
The Compensation and Human Resources Committee is responsible for overseeing (i) our policies and practices related to total compensation for executive officers, (ii) the administration of our incentive and equity based plans, (iii) the risk associated with our compensation practices and plans, and (iv) human capital management, including diversity, equity and inclusion initiatives. The Compensation and Human Resources Committee establishes employment arrangements with our CEO and other executive officers, conducts an annual performance review of the CEO, and reviews and monitors director compensation programs and the Company’s stock ownership guidelines.
Independence:
Each of the Compensation and Human Resources Committee members is an independent director under the NYSE listing standards and the SEC rules, and a non employee director under the SEC rules.
Governance Committee
Meetings Held in 2021: 6
Committee Members:
John H. Noseworthy, M.D. (Chair), Timothy P. Flynn and F. William McNabb III
Primary Responsibilities:
The Governance Committee’s duties include (i) identifying and nominating individuals to be proposed as nominees for election as directors at each annual meeting of shareholders or to fill Board vacancies, (ii) conducting the Board evaluation process, (iii) evaluating the categorical standards which the Board of Directors uses to determine director independence, (iv) providing oversight over ESG policies and practices, including identifying key ESG topics, (v) monitoring and evaluating corporate governance practices, and (vi) reviewing and recommending changes to the Company’s Political Contributions Policy, reviewing political contributions at least semi-annually, and monitoring the Company’s advocacy lobbying processes and activities, including key trade associations and coalition memberships. The Governance Committee also oversees Board processes and corporate governance related risk.
Independence:
Each of the Governance Committee members is an independent director under the NYSE listing standards.
2022 Proxy Statement   |   Board Committees
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Board of
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Governance
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Executive
Compensation
4
Audit
5
Annual
Meeting
6
Other
Information
Health and Clinical Practice Policies Committee
Meetings Held in 2021: 4
Committee Members:
Valerie C. Montgomery Rice, M.D. (Chair), John H. Noseworthy, M.D., and Stephen J. Hemsley
Primary Responsibilities:
The Health and Clinical Practice Policies Committee is responsible for assisting the Board of Directors in fulfilling its responsibilities relating to (i) oversight of management’s initiatives to improve health care affordability, clinical care and safety, enhance health care experience, achieve better outcomes, advance health equity and reduce disparities, and (ii) the Company’s public policy, including the identification, evaluation and monitoring of legislative, regulatory and policy issues, both domestic and international, that affect or could affect the Company’s business reputation, business activities and performance.
Independence:
Drs. Montgomery Rice and Noseworthy are each independent directors under the NYSE listing standards.
Board Meetings and Annual Meeting Attendance
Directors are required to attend at least 75% of Board meetings, meetings of committees on which they serve and the Annual Meeting of Shareholders. All of the nominees are expected to attend the 2022 Annual Meeting. During the year ended December 31, 2021, the Board of Directors held 16 meetings. All current directors attended at least 75% of the meetings of the Board and any Board committees of which they were members in 2021.
Board and Committee Evaluations
The Governance Committee oversees the Board and Committee evaluation process. In addition, the Chair of the Board and the Lead Independent Director meet regularly with individual directors to discuss Board and Committee performance, effectiveness and composition.
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2022 Proxy Statement   |   Board Meetings and Annual Meeting Attendance    |   Board and Committee Evaluations
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Other
Information
As part of director feedback received through the annual evaluation process, the Board continues to place a focus on Board and executive leadership succession and development, engaging with management on achievement of the Company’s long-term strategies and direction, and Board and executive leadership and succession and sustainability, diversity, equity and inclusion topics.
Communication with the Board of Directors
The Board of Directors values the input and insights of our shareholders and other interested parties and believes effective communication strengthens the Board’s role as an active, informed and engaged fiduciary. The Board has adopted a Board of Directors Communication Policy to facilitate communication between shareholders and other interested parties and the Board. Under this policy, the Board has designated the Company’s Secretary to the Board of Directors as its agent to receive and review communications. The Secretary to the Board will not forward to the directors communications received which are of a personal nature or not related to the duties and responsibilities of the Board, including, without limitation, mass mailings, business solicitations, routine customer service complaints, new product or service suggestions and opinion surveys.
Appropriate matters to raise in communications to the Board include Board composition; Board and CEO succession planning process; executive compensation; uses of capital; and general Board oversight, including sustainability, human capital management, corporate governance, accounting, internal controls, auditing and other related matters.
The policy, including information on how to contact the Board of Directors, may be found in the corporate governance
section of our website, www.unitedhealthgroup.com/who-we-are/corporate-governance.
Director Compensation
We compensate our non-employee directors fairly for work required for a company of our size, complexity and scope and to align their interests with the long-term interests of our shareholders. Director compensation reflects our desire to attract, retain and benefit from the expertise of highly qualified people with backgrounds and experience relevant to our business and those we serve. The Compensation and Human Resources Committee annually reviews the compensation of our non-employee directors and makes recommendations to the Board of Directors. In August 2021, the Compensation and Human Resources Committee, with the advice of its independent compensation consultant, undertook a review of the structure, philosophy and overall mix of the director compensation program as compared to the Company’s compensation peer group and also the four large publicly traded managed care and health care and services companies included in the peer group. Following this review, the Compensation and Human Resources Committee recommended no changes to director compensation.
2022 Proxy Statement   |   Communication with the Board of Directors    |   Director Compensation
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Annual
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Other
Information
The following table highlights the material elements of our director compensation program:
Compensation Element
Compensation Value
($)
Annual Cash Retainer
125,000
Annual Chair of the Board Cash Retainer
220,000
Annual Audit and Finance Committee Chair Cash Retainer
25,000
Annual Compensation and Human Resources Committee Chair Cash Retainer
20,000
Annual Governance Committee Chair Cash Retainer
20,000
Annual Health and Clinical Practice Policies Committee Chair Cash Retainer
20,000
Annual Lead Independent Director Cash Retainer
75,000
Annual Equity Award
205,000 aggregate fair value in deferred stock units
Equity Conversion Program
At the director’s election, cash compensation may be
converted into DSUs, or if the director has met the
stock ownership guidelines, into common stock
Cash Compensation
Cash retainers are payable on a quarterly basis in arrears on the first business day following the end of each fiscal quarter and are subject to pro rata adjustment if the director did not serve the entire quarter. Directors may elect to receive deferred stock units (“DSUs”) or common stock (if the director has met the stock ownership guidelines) in lieu of their cash compensation or may defer receipt of their cash compensation to a later date pursuant to the Directors’ Compensation Deferral Plan (“Director Deferral Plan”). The cash retainers are in consideration of general service and responsibilities and required meeting preparation.
Equity-Based Compensation
Non-employee directors receive annual grants of DSUs under the 2020 Stock Incentive Plan having an aggregate fair value of $205,000. The grants are issued quarterly in arrears on the first business day following the end of each fiscal quarter and prorated if the director did not serve the entire quarter. The number of DSUs granted is determined by dividing $51,250 (the quarterly value of the annual equity award) by the closing price of our common stock on the grant date, rounded up to the nearest share. The grants are in consideration of general service and responsibilities and required meeting preparation and serve to align the interests of our directors with those of our shareholders.
The DSUs immediately vest upon grant and must be retained until completion of the director’s service on the Board. Upon completion of service, the DSUs convert into an equal number of shares of the Company’s common stock. A director may defer receipt of the shares for up to ten years after completion of service pursuant to the Director Deferral Plan. Non-employee directors who have met their stock ownership requirement may elect to receive common stock in lieu of DSUs and/or in-service distributions on pre-selected dates.
If a director elects to convert his or her cash compensation into common stock or DSUs, such conversion grants are made on the day the eligible cash compensation becomes payable to the director. The director receives the number of shares of common stock or DSUs, as applicable, equal to the cash compensation foregone, divided by the closing price of our common stock on the date of grant, rounded up to the nearest share. The DSUs immediately vest upon grant. A director may only elect to receive common stock if he or she has met the stock ownership guidelines.
2022 Proxy Statement   |   Director Compensation
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Other
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The Company pays dividend equivalents in the form of additional DSUs on all outstanding DSUs. Dividend equivalents are paid at the same rate and at the same time that dividends are paid to Company shareholders and are subject to the same vesting conditions as the underlying grant.
Stock Ownership and Retention Guidelines
Under our stock ownership guidelines, we require non-employee directors to achieve ownership of shares of the Company’s common stock (excluding stock options, but including vested DSUs and vested restricted stock units) having a fair market value equal to five times the directors’ annual base cash retainer. Non-employee directors must comply with the stock ownership guidelines within five years of their appointment to the Board of Directors. All of our non-employee directors have met the stock ownership requirement or have served as a director for less than five years. Our directors are required to hold all equity awards granted until completion of service on the Board or until they have met our stock ownership requirements.
Director Deferral Plan
Under the Director Deferral Plan, subject to compliance with applicable laws, non-employee directors may elect annually to defer receipt of all or a percentage of their compensation. Amounts deferred are credited to a bookkeeping account maintained for each director participant that uses a predetermined collection of unaffiliated mutual funds as measuring investments. The Director Deferral Plan does not provide for matching contributions by the Company.
Other Compensation
We reimburse directors for any reasonable out-of-pocket expenses incurred in connection with service as a director. We also provide health care coverage to directors if the director is not eligible for subsidized coverage under another group health care benefit program. Health care coverage is provided on the same terms and conditions as current employees. Upon retirement from the Board of Directors, directors may continue to obtain health care coverage under benefit continuation coverage, and after the lapse of such coverage, under the Company’s post-employment medical plan for up to a total of 96 months if they are otherwise eligible.
The Company maintains a program through which it will match up to $15,000 of charitable donations made by each director for each calendar year. The directors do not receive any financial benefit from this program because the charitable income tax deductions accrue solely to the Company. Donations under the program may not be made to family trusts, partnerships or similar organizations.
Our corporate aircraft use policy generally prohibits personal use of corporate aircraft by any independent director.
2022 Proxy Statement   |   Director Compensation
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The following table provides information for the year ended December 31, 2021, relating to compensation paid to or
accrued by us on behalf of our non-employee directors who served in this capacity during 2021.
2021 Director Compensation Table
Name(1)
Fees Earned or
Paid In Cash
($)(2)
Stock
Awards
($)(3)
All Other
Compensation
($)(4)
Total
($)
Richard T. Burke 200,000 205,573 28,254 433,827
Timothy P. Flynn 351,182 23,168 374,350
Paul R. Garcia 15,000 15,000
Stephen J. Hemsley 550,700 23,928 574,628
Michele J. Hooper 145,000 205,573 15,521 366,094
F. William McNabb III 338,682 8,987 347,669
Valerie C. Montgomery Rice, M.D. 39,061 291,813 33,100 363,973
John H. Noseworthy, M.D. 330,787 10,000 340,787
Glenn M. Renwick 244,006 4,494 248,500
Gail R. Wilensky, Ph.D. 145,000 205,978 15,000 365,978
(1)
Mr. Renwick did not stand for re-election at the 2021 Annual Meeting of Shareholders and ceased serving as a member of the Board of Directors on June 7, 2021. Because director compensation is paid quarterly in arrears and Mr. Garcia joined the Board on November 2, 2021, he did not receive any cash or equity compensation in 2021, although the Company matched $15,000 in charitable contributions he made in 2021.
(2)
Directors converted some or all of cash compensation payable to such director into DSUs as follows:
Name
Amount of
Cash
($)
Deferred Stock
Units
(#)
Timothy P. Flynn 145,608 386
Stephen J. Hemsley 345,532 916
F. William McNabb III 133,881 354
Valerie C. Montgomery Rice, M.D. 86,239 227
John H. Noseworthy, M.D. 125,985 334
Glenn M. Renwick 37,746 108
(3)
The amounts reported reflect the aggregate grant date fair value of the stock awards granted in 2021 computed in accordance with FASB ASC Topic 718, based on the closing price of our common stock on the grant date. For a description of the assumptions used in computing the aggregate grant date fair value, see Note 11 to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. For 2021, Dr. Wilensky elected for a portion of her annual DSU awards be granted in shares of common stock.
2022 Proxy Statement   |   2021 Director Compensation Table
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The aggregate grant date fair values of the stock awards granted in 2021, computed in accordance with FASB ASC Topic 718 based on the closing price of our common stock on the grant date, are as follows:
Name
January 4, 2021
($)
April 1, 2021
($)
July 1, 2021
($)
October 1, 2021
($)
Richard T. Burke 51,377 51,390 51,421 51,386
Timothy P. Flynn* 87,725 87,730 87,861 87,866
Stephen J. Hemsley* 137,703 137,651 137,663 137,683
Michele J. Hooper 51,377 51,390 51,421 51,386
F. William McNabb III* 82,832 82,591 84,217 89,043
Valerie C. Montgomery Rice, M.D.* 67,104 74,882 74,905 74,922
John H. Noseworthy, M.D.* 82,832 82,591 82,598 82,767
Glenn M. Renwick* 88,773 88,831 66,402
Gail R. Wilensky, Ph.D. 51,377 51,390 51,826 51,386
*
Includes the value of DSUs issued upon conversion of annual cash retainers as described in footnote 2 above of $145,608 for Mr. Flynn, $345,532 for Mr. Hemsley, $133,881 for Mr. McNabb, $86,239 for Dr. Montgomery Rice, $125,985 for Dr. Noseworthy, and $37,746 for Mr. Renwick.
As of December 31, 2021, our non-employee directors held outstanding DSU awards as follows:
Name
Deferred
Stock Units
Richard T. Burke 26,512
Timothy P. Flynn 6,232
Paul R. Garcia
Stephen J. Hemsley 3,427
Michele J. Hooper 33,500
F. William McNabb III 4,375
Valerie C. Montgomery Rice, M.D. 3,539
John H. Noseworthy, M.D. 3,026
Glenn M. Renwick 5,889
Gail R. Wilensky, Ph.D. 23,577
(4)
In 2021, the Company matched charitable contributions made by the following directors to charitable organizations selected by the directors pursuant to the Company’s Board Matching Program: $15,000 for Messrs. Burke, Flynn, Garcia and Hemsley, Ms. Hooper and Drs. Montgomery Rice and Wilensky; and $10,000 for Dr. Noseworthy. In 2021, the Company also paid $13,254, $8,168, $8,928, $4,494, $8,987 and $521 in health care premiums on behalf of Messrs. Burke, Flynn, Hemsley, Renwick and McNabb and Ms. Hooper, respectively. This amount also includes $18,100 for use of corporate aircraft by Dr. Montgomery Rice pursuant to an exception to our corporate aircraft policy.
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Corporate Governance
Overview
UnitedHealth Group is committed to high standards of corporate governance and ethical business conduct. Important documents reflecting this commitment are listed below.
Corporate Governance Documents

Certificate of Incorporation

Code of Conduct: Our Principles of Ethics & Integrity

Bylaws

Related-Person Transactions Approval Policy

Principles of Governance

Board of Directors Communication Policy

Board of Directors Committee Charters

Political Contributions Policy

Standards for Director Independence

Corporate Environmental Policy

Director Conflict of Interest Policy
You can access these documents at www.unitedhealthgroup.com/who-we-are/corporate-governance to learn more about our corporate governance practices. We will also provide copies of these documents without charge upon written request to the Company’s Secretary to the Board of Directors.
Commitment to Effective Corporate Governance
Board Accountability to Shareholders
Annual Election
All directors stand for election by majority vote annually
Proxy Access
Proxy access with market terms
Majority Voting Standard/Irrevocable Offer to Resign
Majority voting in uncontested director elections; directors tender an irrevocable offer to resign if they do not receive majority vote and the Board will accept such offer to resign absent a compelling reason
Special Meeting / Written Consent Rights
Shareholders have the rights to call a special meeting and act by written consent
No Poison Pill
No shareholder rights plan (commonly referred to as a “poison pill”)
Shareholder Voting Rights in Proportion to Economic Interests
One Share, One Vote
No dual class structure; each share of common stock is entitled to one vote
No Supermajority Requirements
No supermajority shareholder approval requirements
Board Responsiveness to Shareholders / Proactive Understanding of Shareholder Perspectives
Shareholder Engagement Process
Management and Board members met with key shareholders in 2021
Shareholder engagement topics included Board composition, leadership and refreshment, executive compensation program, diversity and inclusion, sustainability, climate change, cyber security, human capital and social topics
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Strong Independent, Board Leadership Structure
Board Leadership
Separate CEO and Chair of the Board
Lead Independent Director
Lead Independent Director with clearly defined and robust duties
Annual Review
Board considers appropriateness of its leadership structure at least annually
Committee Membership
Independent Committee chairs with clear charters and oversight mandates
Disclosure
Proxy discloses why Board believes current leadership structure is appropriate
Adopt Structures and Practices Enhancing Board Effectiveness
Independence
75% of our Board members are independent
Diversity
3/8 of our director nominees are ethnically diverse, 1/4 are women and 1/4 are African American
Board and Committee Evaluations
Annual Board and Committee evaluation conducted by independent consultant and led by the Chair of Governance Committee
Board Succession Planning
Active Board succession plan; seven Board members added since 2017, six of whom are standing for election
Attendance
Directors attended 99% of combined total Board and applicable committee meetings in 2021 and all then-current directors attended the 2021 Annual Meeting
Board Service Limits
Independent directors may serve on no more than three other public company boards; and our CEO may serve on no more than one other public company board
Executive Sessions
Frequent executive sessions of independent directors held
Conflicts of Interest
To avoid potential conflicts of interest, a director is required to seek approval of the Governance Committee if the director or his/her immediately family member proposes to engage in a transaction or activity in the health care field
Disclosure
Full disclosure of corporate governance policies and practices
ESG Oversight
Board oversight over ESG strategy as codified in Board Committee charters; Company appointed Chief Sustainability Officer
Align Management Incentive Structures with Long-Term Strategy
Say on Pay Results
Executive Compensation program received more than 95% shareholder support from 2011 through 2020; responsive actions taken to address topics identified by shareholders in connection with 2021 say on pay result of 72% support
Annual Review of Compensation Program
Compensation and Human Resources Committee annually reviews and approves incentive program design, goals and objectives for alignment with compensation and business strategies
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Align Management Incentive Structures with Long-Term Strategy
Incentive Programs Linked to Strategy
Annual and long-term incentive programs are designed to reward financial and operational performance that furthers short- and long-term strategic objectives
Non-Financial Performance Goals
A portion of our annual incentive award is dependent upon the achievement of goals of customer, provider and employee satisfaction, which are viewed to be important to achieving long-term success for the Company
Clawback Policy
Clawback policy entitles the Board to seek cash or equity reimbursement from our senior executives if they are directly involved in fraud or misconduct causing a material restatement, material detrimental conduct or violate non-compete, non-solicit or confidentiality provisions.
Strong and effective governance practices are critical to UnitedHealth Group’s long-term value creation. The Board has enhanced governance policies over time to align with best practices, drive sustained shareholder value and serve the interests of shareholders. Our corporate governance practices align with the corporate governance principles developed by the Investor Stewardship Group (ISG), which includes some of the largest institutional investors and global asset
managers and advocates for best practices in corporate governance.
Code of Conduct: Our Principles of Ethics & Integrity
Our Board adopts and oversees enforcement of the Company’s Global Code of Conduct (Code). Foundational to the Company’s compliance and ethics program and subject to periodic ethical risk assessments, our Code defines responsibilities, accountabilities and reporting lines related to business conduct, conflicts of interest, public disclosure practices, legal compliance obligations, and other areas. The Code also describes misconduct reporting and whistleblower legal protections, reporting confidentiality and helpline contact information, violation actions (including termination and possible legal action), non-retaliation principles, fair dealing, and the protection and proper use of personal information and Company assets. The Code is available on the Company’s website.
Any waiver of the Code for the Company’s executive officers, senior financial officers or directors may be made only by the Board or a committee of the Board. We will publish any amendments to the Code and waivers of the Code for an executive officer or director on our website. Our entire global workforce, including independent contractors and part-time employees, receives periodic training on our Code and other ethical standards.
Compliance and Ethics
We strongly and broadly encourage employees to raise ethics and compliance concerns, including concerns about accounting, internal controls or auditing matters. We offer several channels for employees and third parties to report ethics and compliance concerns or incidents, including by telephone or online, and individuals may choose to remain anonymous in jurisdictions where anonymous reporting is permissible. We prohibit retaliatory action against any individual who in good faith raises concerns or questions regarding ethics and compliance matters or reports suspected violations. We train all employees annually and periodically advise them regarding the means by which they may report possible ethics or compliance issues and their affirmative responsibility to report any possible issues.
2022 Proxy Statement   |   Code of Conduct   |   Compliance and Ethics
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Enterprise-Wide Risk Oversight
Our Board of Directors oversees management’s enterprise-wide risk management activities. Risk management activities include assessing and taking actions necessary to manage risk incurred in connection with the long-term strategic direction and operation of our business. Each director on our Board is required to have risk oversight ability for each skill and attribute the director possesses reflected in the collective skills section of our director skills matrix described in “Proposal 1 — Election of Directors — Director Nomination Process — Criteria for Nomination to the Board” above. Collectively, our Board of Directors uses its committees to assist in its risk oversight function as follows:

The Audit and Finance Committee oversees management’s internal controls and compliance activities. The Audit and Finance Committee also oversees management’s processes to identify and quantify material risks facing the Company, including risks disclosed in the Company’s Annual Report on Form 10-K. The enterprise risk management function assists the Company in identifying and assessing the Company’s material risks. The Company’s General Auditor, who reports to the Audit and Finance Committee, assists the Company in evaluating risk management controls and methodologies. The Audit and Finance Committee receives periodic reports on the enterprise risk management function and the Company’s cyber security efforts and meets periodically with management to review the Company’s significant risks and the steps management has taken to monitor, control or mitigate such risks. In connection with its risk oversight role, the Audit and Finance Committee regularly meets privately with representatives from the Company’s independent registered public accounting firm and the Company’s Chief Financial Officer, General Auditor and Chief Legal Officer;

The Compensation and Human Resources Committee oversees risks associated with our compensation policies, practices and plans and human capital management practices;

The Governance Committee oversees Board processes and corporate governance-related risk, community and charitable activities and overall strategy on ESG policies and practices; and

The Health and Clinical Practice Policies Committee oversees (i) management’s initiatives to improve health care affordability, clinical care and safety, enhance the health care experience, achieve better health outcomes, advance health equity and reduce disparities, and (ii) risk associated with the public policy arena, including health care reform and modernization activities, government relations, and risk related to health and clinical practices.
Our Board of Directors maintains overall responsibility for oversight of the work of its various committees by receiving regular reports from the committee chairs regarding their work. In addition, discussions about the Company’s culture, strategic plan, consolidated and segment business results, capital structure, merger and acquisition-related activities and other business discussed with the Board of Directors include a discussion of the risks associated with the particular item under consideration. Our Board of Directors and Board committees also have authority to retain independent advisers. Our Board of Directors’ and committee’s respective processes for managing cyber security risk oversight and incentive compensation risk are set forth below.
Cyber Security Risk Oversight
We believe health care data and related information should be used solely for the purposes of improving individual health, advancing health system performance and to aid in new health care discoveries. We operate in a sector where the use of health care information is highly regulated. Federal, state, and international laws and contractual commitments regulate our collection, use and disclosure of confidential information such as protected health information and personally identifiable information. Our success depends on maintaining a high level of trust among consumers, clients, providers, regulators and our associates. Protecting this information is critical and is reflected in our Code of Conduct, security standards, and privacy policies.
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The Audit and Finance Committee has oversight of our cyber security program and receives regular updates from our Chief Information Security Officer. We devote significant resources to protecting and evolving the security of our computer systems, software, networks and other technology assets in response to a continually changing threat landscape. The operating maturity of our cyber security program is benchmarked against a continuously updated set of control requirements based upon the HITRUST framework and is subject to an annual external certification process by the HITRUST Alliance. An incidence response preparedness assessment was conducted in 2020 by a leading external cyber security company.
We provide annual security-awareness and privacy training to all of our employees, including part-time and temporary, and contractors, which covers timely and relevant topics, including social engineering, phishing, password protection, confidential data protection, asset use and mobile security. Our comprehensive privacy-incident response and prevention program educates associates on the importance of reporting all incidents immediately. Each incident is reviewed and action is taken to address issues identified, mitigate any potential impact and assess our obligations to notify consumers, clients, regulators, the media and others. Information regarding how we manage data privacy and cyber security is available at https://www.unitedhealthgroup.com/content/sustainability/en/responsible-business/data-privacy.html.
Incentive Compensation Risk Assessment
Our Compensation and Human Resources Committee requested management to conduct an annual risk assessment of the Company’s enterprise-wide compensation programs. The risk assessment reviewed both cash incentive compensation plans and individual cash incentive awards paid in 2021 for the presence of potential design elements that could motivate employees to incur excessive risk. The review included the ratio and level of incentive to fixed compensation, the amount of manager discretion, the level of compensation expense relative to the business units’ revenues, and the presence of other design features which serve to mitigate excessive risk-taking, such as the Company’s clawback policy, stock ownership and retention guidelines, multiple performance measures and similar features.
After considering the results of the risk assessment, management concluded the level of risk associated with the Company’s enterprise-wide compensation programs is not reasonably likely to have a material adverse effect on the Company. The results of the risk assessment were reviewed with the Compensation and Human Resources Committee at its February 2022 meeting. Please see “Compensation Discussion and Analysis” for a discussion of compensation design elements intended to mitigate excessive risk-taking by our executive officers.
The Compensation and Human Resources Committee also receives an annual report on the Company’s compliance
with its equity award program controls.
Alignment of Environment, Social and Governance (ESG) with Our Long-Term Strategy
What Sustainability Means to Us
Sustainability is an extension of our business strategy, culture and mission as we work to help ensure the health care system works better for everyone. At UnitedHealth Group, we are committed to providing distinct value for those we are privileged to serve, including our shareholders and society broadly.
We are dedicated to earning the opportunity to serve more people and drive shareholder and societal value by focusing on the following key topics determined through broad stakeholder engagement and approval from our senior leaders and Board of Directors.
2022 Proxy Statement   |   Alignment of Environment, Social and Governance (ESG) with Our Long-Term Strategy
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Environmental Health

Maintaining sound governance and oversight of our environmental management efforts.

Minimizing our impact on the environment by reducing our carbon footprint, using water and energy efficiently, implementing comprehensive waste management programs and employee engagements. We target to achieve operational net zero emissions by 2035 (Scope 1 and Scope 2) and will be outlining our plan to achieve these goals in our 2021 Sustainability Report.

Engaging our stakeholders — including team members and partner organizations — to promote and practice environmental responsibility.

Creating systemic change by co-chairing the National Academy of Medicine’s Climate Collaborative to meaningfully reduce the carbon footprint of the U.S. health system.
Helping to Create a Modern, High-Performing Health System

Expanding access to care through a long-standing commitment to achieve universal coverage by harnessing digital tools and virtual platforms and investing in primary care.

Improving health care affordability through advancing value-based care, optimizing where patients receive care and lowering the cost of prescription drugs.

Enhancing the health care experience by improving patient and clinician satisfaction and providing personalized, dedicated member support and culturally competent care.

Achieving better health outcomes by managing chronic disease, applying a holistic approach to mental health care and improving health literacy.

Advancing health equity with personalized care tailored to an individual’s needs, helping to build a diverse health workforce, improving the health of underserved communities and leveraging data to reduce disparities in care.

Building healthier communities through our social responsibility efforts, including philanthropic grants, in-kind contributions and supporting our employees who volunteer their time and resources in the communities where they work and live.
Our People and Culture

Fostering an inclusive, equitable and diverse environment where all team members are appreciated, valued and able to reach their full potential.

Sustaining high performance and resilience by supporting employee well-being and rewarding and recognizing outstanding performance.

Developing and growing our talent with robust virtual onboarding and digital self-assessment tools.
2022 Proxy Statement   |   Alignment of Environment, Social and Governance (ESG) with Our Long-Term Strategy
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Responsible Business Practices

Maintaining strong and effective corporate governance to drive sustained shareholder value and respond to the interests of our shareholders.

Adhering to our values through ethics and compliance that guide our behavior and help us remain a trusted partner.

Maintaining data privacy and cyber security, recognizing our obligation to build and maintain the trust and confidence of our stakeholders and customers, ensuring we can protect the information for all those we serve.

Partnering with suppliers to maximize value in our supply chain to ensure we buy the right goods and services, from the right suppliers, for the right price, in a timely manner.

Committing to supplier diversity by developing a supplier base that reflects the communities and customers we are privileged to serve.
Our 2020 Sustainability Report, available at https://sustainability.uhg.com/content/dam/UHG/PDF/sustainability/final/2020_SustainabilityReport.pdf, summarizes the steps the Company is taking to build a health system that works better for everyone through the organization’s environmental, social and governance efforts. We also attached our EEO-1 report as an exhibit to the Sustainability Report. We have committed to map our disclosures to the Sustainability Accounting Standards Board (“SASB”) in our 2021 Sustainability Report.
Sustainability Governance
In close partnership with business leaders from across our enterprise, the Chief Sustainability Officer is responsible for developing and implementing a comprehensive ESG strategy, establishing annual and long-term sustainability goals, performance metrics, a governance structure to achieve them, and helping to shape our environmental, social and governance agendas.
The Governance Committee is responsible for providing oversight over ESG policies and practices, including identifying key ESG topics, ensuring appropriate Board or Board committee oversight of these topics, overseeing the Company’s environmental and climate change initiatives, corporate citizenship activities and reviewing the Company’s ESG sustainability reports. The Audit and Finance Committee oversees management’s processes to identify ESG investment criteria and provide assurance of ESG disclosures. The Compensation and Human Resources Committee reviews the Company’s strategies, programs and outcomes related to each of human capital management as well as diversity, equity and inclusion. The Health and Clinical Practice Policies Committee oversees management’s efforts and initiatives to expand access to health care, improve health care affordability, clinical care and safety, enhance the health care experience, achieve better health outcomes, advance health equity, and reduce health disparities.
2022 Proxy Statement   |   Alignment of Environment, Social and Governance (ESG) with Our Long-Term Strategy
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Executive Compensation
Executive Summary
Overview
UnitedHealth Group’s compensation program is designed to attract and retain highly qualified executives and to maintain a strong link between pay and the achievement of enterprise-wide goals. We emphasize and reward teamwork and collaboration among executive officers, which we believe fosters Company growth and performance, optimizes the use of enterprise-wide capabilities, drives efficiencies and integrates products and services for the benefit of our customers and other stakeholders.
In determining 2021 executive compensation, the Compensation and Human Resources Committee considered the Company’s strong growth, operating performance and financial results, all of which were achieved in an uncertain environment, as well as individual executive performance. Some of our key business results for 2021 were:
Financial

Total shareholder return in 2021 was 45%, and 107% from 2019-2021, reflecting continued strong fundamental performance;

Revenues increased 12% to $287.6 billion in 2021 from $257.1 billion in 2020;

Net earnings increased 12% year-over-year to $17.3 billion; operating earnings increased 7% year-over-year to $24.0 billion; and cash flows from operations were $22.3 billion in 2021;

Fully diluted earnings per share increased 13% to $18.08 per share from $16.03 in 2020. Adjusted earnings per share1 increased 13% to $19.02 per share from $16.88 per share in 2020;

Return on equity at 25.2% in 2021 compared to 24.9% in 2020, reflecting the Company’s strong operating performance and efficient capital structure; and

The annual cash dividend rate increased to $5.80 per share, representing a 16% increase over the annual cash dividend rate of $5.00 per share since the second quarter of 2020.
Awards and Recognition

United Health Group was the top ranked company in the insurance and managed care sector on Fortune’s 2022 “World’s Most Admired Companies” list. This is the twelfth consecutive year UnitedHealth Group has ranked No. 1 overall in its sector. The Company ranked No. 1 on all nine key attributes of reputation —  innovation, people management, use of corporate assets, social responsibility, quality of management, financial soundness, long-term investment value, quality of products and services and global competitiveness;

UnitedHealth Group has been named to both the Dow Jones Sustainability World and North America Indices every year since 1999;

UnitedHealth Group received a score of 100 on the Human Rights Campaign Foundation’s Corporate Equality Index 2022, earning the distinction of one of the “Best Places to Work for LGBTQ Equality”;

In 2021, and for the tenth consecutive year, The Civic 50, a Points of Light initiative that highlights companies that improve the quality of life in the communities where they do business, ranked UnitedHealth Group one of America’s 50 most community-minded companies. In addition, UnitedHealth Group was named the leader in the Healthcare Sector category for the fourth time overall;

UnitedHealth Group was named to Forbes’ list of 2021 World’s Best Employers;

Prospanica, an organization that has worked to empower Hispanic professionals for over 30 years, recognized UnitedHealth Group with the 2021 Brillante Award for Corporate Excellence;
1.
Adjusted earnings per share is a non-GAAP financial measure. Refer to Appendix A in this proxy statement for a reconciliation of adjusted earnings per share to the most directly comparable GAAP measure.
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The CDP (formerly Carbon Disclosure Project) named UnitedHealth Group to its Leadership Band in 2020 for efforts to reduce greenhouse gas emissions;

The Disability Equality Index® named UnitedHealth Group one of the best places to work for disability inclusion in 2021;

UnitedHealth Group has been ranked No. 4 in the nation on the 2022 Military Friendly® Employers list; and

UnitedHealth Group is recognized as a “Trendsetter” in the 2021 Center for Political Accountability-Zicklin Index of Political Accountability.
The Compensation and Human Resources Committee believes total compensation for the executive officers listed in the 2021 Summary Compensation Table (the “named executive officers” or “NEOs”) should be heavily weighted toward long-term performance-based compensation. In 2021, long-term compensation represented approximately 75% of the total compensation granted to our NEOs. The elements of compensation for our NEOs were unchanged from 2020. We endeavor to maintain strong governance standards in the oversight of our executive compensation programs, including the following policies and practices in effect during 2021:
Strong Oversight and Pay Practices

Compensation and Human Resources Committee consisting entirely of independent Board members.

Performance-based compensation arrangements, including performance-based equity awards that use a balanced set of performance measures (including human capital measures), with different metrics used for annual and long-term incentive plans.

Double-trigger accelerated vesting of equity awards, requiring both a change in control and a qualifying employment termination, which is our only change in control consideration.

All long-term incentive awards are denominated and settled in equity.

A compensation clawback policy that entitles the Board of Directors to seek cash or equity reimbursement from our senior executives if they are directly involved in fraud or misconduct causing a material restatement, material detrimental conduct and a senior executive’s violation of non-compete, non-solicit or confidentiality provisions.

A stock retention policy that requires executive officers to hold, for at least one year, one-third of the net shares acquired upon vesting or exercise of any equity award.

Each of our executive officers and directors was in compliance with our stock ownership guidelines as of April 8, 2022.

Annual advisory shareholder vote to approve the Company’s executive compensation.

The direct retention by the Compensation and Human Resources Committee of its independent compensation consultant, Pay Governance LLC, who performs no other consulting or other services for the Company.
What We Don’t Do

No excise tax gross-ups. Generally no executive-only perquisites.

No repricing of stock options and stock appreciation rights or cash buyouts without shareholder approval.

No discounted stock options or stock appreciation right awards.

No reload of stock options.

No hedging and pledging transactions by directors and executive officers.
Former CEO David S. Wichmann
As previously disclosed in the Company’s 2021 proxy statement, the terms of Mr. Wichmann’s employment agreement provide for payments approximating his most recent base salary and non-equity incentive compensation award for a two-year period.
Pursuant to applicable SEC rules, the entire amount payable to Mr. Wichmann over the two-year period is included in this year’s Summary Compensation Table. The amount set forth for Mr. Wichmann in this proxy statement is consistent with the disclosures made in the Company’s 2021 proxy statement. Mr. Wichmann has not been provided with any additional compensation since his departure from the Company in February 2021.
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Performance Graph
The following performance graph compares the cumulative one-year, three-year and five-year return to shareholders on our common stock relative to the cumulative total returns of the S&P Health Care Index, the Dow Jones US Industrial Average Index and the S&P 500 index for the period ended December 31, 2021. The comparisons assume the investment of $100 on December 31, 2016 in our common stock and in each index, and dividends were reinvested when paid.
[MISSING IMAGE: tm223410d1-lc_comparbwlr.jpg]
12/2016
($)
12/2017
($)
12/2018
($)
12/2019
($)
12/2020
($)
12/2021
($)
UnitedHealth Group 100.00 139.82 160.13 192.13 232.87 338.16
S&P Health Care Index 100.00 122.08 129.97 157.04 178.15 224.70
Dow Jones US Industrial Average 100.00 128.11 123.65 154.99 170.06 205.68
S&P 500 Index 100.00 121.83 116.49 153.17 181.35 233.41
The stock price performance included in this graphic is not necessarily indicative of future stock price performance.
UnitedHealth Group’s market capitalization has grown 42%, 98% and 210% over the one year, three year and five year periods, respectively, for the period ended December 31, 2021.
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Compensation Discussion and Analysis
The following table sets forth the Company’s compensation program and philosophy, core principles that reinforce our philosophy and process for determining compensation.
Program Philosophy and
Objectives
Compensation Program Principles
Determination of Compensation

Align the economic interests of our executive officers with those of our shareholders.

Reward performance that advances our mission of helping people live healthier lives and helping make the health system work better for everyone.

Reward performance that emphasizes teamwork and close collaboration among executive officers while also recognizing individual performance.

Reward performance that supports the Company’s values.

Foster an entrepreneurial spirit with innovative thinking and action that leverages the ingenuity of our employees.

Attract and retain highly qualified executives.

Pay-for-performance. A large majority of our executive officers’ total compensation is at risk and only earned based on achievement of enterprise-wide goals.

Enhance the long-term value of the business. Our pay system is weighted toward long-term compensation to promote long-term shareholder value creation and avoid excessive risk-taking.

Reward long-term growth and focus management on sustained success and shareholder value creation. Compensation of our executive officers is heavily weighted toward equity, and we require significant stock ownership and share retention by our management team. This encourages sustained performance and positive shareholder returns.

Provide standard benefits. We provide standard employee benefits and generally do not have “executive-only” benefits or perquisites.

The Compensation and Human Resources Committee oversees the Company’s risks, policies, and philosophy related to total compensation for executive officers.

The Compensation and Human Resources Committee reviews and approves the compensation for the named executive officers based on its own evaluation, input from the Chair of the Board, our CEO (for all executive officers except himself), internal pay equity considerations, the tenure, role, and performance of each named executive officer, input from its independent consultant and market data.
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Our 2021 Say On Pay Vote; Shareholder Engagement
Addressing the 2021 Say on Pay Vote
Our annual say on pay vote is one of our opportunities to receive feedback from shareholders regarding our executive compensation program. The say on pay proposal at the 2021 Annual Meeting received 72% as compared to an average of over 95% support from 2011 through 2020. We sought feedback from shareholders to better understand what motivated their votes and what actions we could take to address their concerns.
Shareholder Engagement and Our Response
We contacted shareholders representing approximately 53.5% of our outstanding shares and met with holders of 40.2% of our outstanding shares.
Shareholder Engagement Efforts — Key Statistics
Scope of
Engagement:

Contacted: 46 shareholders representing 53.5% of our outstanding shares

Met with: 27 shareholders representing 40.2% of our outstanding shares
Engagement Team:

Chair of the Compensation and Human Resources Committee met with 15.1% of outstanding shares

Chief People Officer

Corporate Secretary
The following is a summary of feedback raised by a majority of shareholders when voting on our 2021 say on pay resolution and how the Board/Compensation and Human Resources Committee has responded to those topics.
Topic Raised
Company Comments / Board Response
Overall design and philosophy of the executive compensation program
In our meetings with shareholders, we were pleased to hear strong shareholder support of the overall design of our executive compensation program as well as the Company’s overall pay-for-performance alignment
Shareholders overwhelmingly did not indicate a desire for broad changes to our program design
Payment of severance in connection with former CEO’s retirement disclosed in the 2021 proxy statement and reflected in the Summary Compensation Table on page 48 of this proxy statement. The Compensation and Human Resources Committee confirmed that going forward it has no intention of paying severance in connection with the retirement of an executive officer
Clawback policy only applies if a financial restatement occurs The Compensation and Human Resources Committee broadened the clawback policy to include material detrimental conduct as a trigger
Improve disclosure of annual incentive plan metrics The CD&A includes enhanced disclosure on the non-financial metrics included in the annual incentive plan
Target executive compensation should be set at the median for peer group companies The CD&A includes enhanced disclosure of the rationale for executive compensation targets
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Additional issues raised in the course of engagement with shareholders included Board tenure, actions focused on carbon emissions and ESG disclosure. As we have disclosed in this proxy statement, the average tenure of our director nominees is 6.6 years and we will map our disclosures to the SASB reporting framework in our 2021 Sustainability Report. We have also previously announced our commitment to achieving operational net zero carbon emissions by 2035.
The Board and the Compensation and Human Resources Committee considered our shareholders’ feedback carefully and continue to strongly believe that our compensation program’s strong design contributes meaningfully to the Company’s success and is strongly aligned with shareholder interests. It remains critical that the Company continues to have an executive compensation program that appropriately attracts, retains and incentivizes management while aligning pay with performance, driving long-term value creation and reflecting the views of shareholders. We will continue to consider shareholder feedback on an ongoing basis with respect to potential changes to the program while preserving the program’s general design and value to UnitedHealth Group and all of our shareholders.
Respective Roles of Management and the Compensation and Human Resources Committee
The Compensation and Human Resources Committee oversees the Company’s risks, policies and philosophy related to total compensation for executive officers. Management recommends appropriate enterprise-wide financial and non-financial performance goals for use in incentive compensation. The Compensation and Human Resources Committee reviews and approves the compensation for the named executive officers based on its own evaluation, input from the Chair of the Board, our CEO (for all executive officers except himself), internal pay equity considerations, the tenure, role and performance of each named executive officer, input from its independent consultant and market data.
The Compensation and Human Resources Committee’s Use of an Independent Compensation Consultant
The Compensation and Human Resources Committee retains an independent compensation consultant, Jon Weinstein of Pay Governance LLC, to advise the Compensation and Human Resources Committee on executive and director compensation matters, assess total compensation program levels and program elements for executive officers and evaluate competitive compensation trends. Pay Governance does not provide any other services to the Company and does not perform any work for management. The Compensation and Human Resources Committee has assessed the independence of Mr. Weinstein and of Pay Governance, specifically considering, in accordance with SEC rules, whether Mr. Weinstein and Pay Governance had any relationships with the Company, our officers or our Board members that would impair their independence. Based on this evaluation, the Compensation and Human Resources Committee concluded Mr. Weinstein and Pay Governance are independent and their work for the Compensation and Human Resources Committee does not raise any conflict of interest.
Competitive Positioning
The Compensation and Human Resources Committee believes total compensation for the named executive officers should be heavily weighted toward long-term performance-based compensation, but it does not target a specific mix of annual and long-term compensation or cash and equity compensation and does not formulaically set compensation targets.
In general, the Compensation and Human Resources Committee’s goal is to achieve total compensation for the named executive officers as a group that falls within a range of the 50th to 75th percentiles of the market data for our peer group (as discussed below), if paid at target. The Compensation and Human Resources Committee believes this range is an appropriate reflection of the Company’s relative size in comparison to our peer group and the broader market, complexity and consistently strong performance over the past several years, with the Company positioned above the 75th percentile of our peer group on key measures such as revenue, market capitalization, and employees, as shown below. The following briefly summarizes the processes followed by the Compensation and Human Resources Committee to select competitive compensation benchmark data and how the Compensation and Human Resources Committee uses these data.
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Peer Group
Peer Group
Alphabet Inc. Centene Corporation Johnson & Johnson
Amazon.com, Inc. Cigna Corporation JPMorgan Chase & Co.
AmerisourceBergen Corporation Citigroup Inc. McKesson Corporation
Anthem, Inc. CVS Health Corporation Microsoft Corporation
Apple Inc. Humana Inc. Walgreens Boots Alliance, Inc.
Bank of America Corporation International Business Machines Wells Fargo & Company
Cardinal Health, Inc.
This screening process resulted in the 19 companies set forth above. We are significantly larger than most of our peers as reflected below (data as of December 31, 2021):
Minimum
50th Percentile
UnitedHealth
Group
Maximum
Annual Revenue
$57B
$139B
$288B
(88th percentile)
$470B
Market Cap
$14B
$120B
$473B
(78th percentile)
$2,913B
Employees
40,000
156,500
350,000
(94th percentile)
1,608,000
At the request of the Compensation and Human Resources Committee, Pay Governance conducts an annual review of the Company’s compensation peer group. This review ensures the peer group companies remain appropriate from a business and talent perspective. This occurs at the second quarter Compensation and Human Resources Committee meeting, because recent financial and compensation data are available at this time.
The Compensation and Human Resources Committee uses the following screening methodology, which formulates a peer group focused on the characteristics and industries most relevant to the Company:

The 40 largest U.S. companies by revenue and market capitalization.

Apply an industry screen to limit peer companies to those industries from which the Company recruits senior leaders:

Managed Care

Pharma/Life Sciences

Technology

Health Care and Services

Financial Services

Include the Company’s 4 largest managed care competitors, even if they do not all meet the screening criteria.
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Once the process is concluded and peer group companies are selected, the Compensation and Human Resources Committee generally uses the market data as follows:

At the fourth quarter Compensation and Human Resources Committee meeting, Pay Governance presents an annual review of the market competitiveness of the Company’s executive compensation levels for the Company’s executive officers. The review compares the compensation opportunities provided to the Company’s executive officers to peer group companies on a position-by-position basis and on an aggregate basis.

At the first quarter Compensation and Human Resources Committee meeting, the Compensation and Human Resources Committee determines pay opportunities for each officer using the market competitiveness assessment from the previous fourth quarter as a reference point. In addition, the Compensation and Human Resources Committee takes into consideration the individual officer’s tenure in such position, Company’s performance against previously established performance goals, each officer’s individual performance, internal equity, the CEO’s recommendations and other relevant business performance that may not be adequately captured by the Company and individual officer goals.
Target total compensation of our named executive officers as a group in 2021, consisting of base salary, target annual cash incentive award, and the grant date fair value of equity awards (including performance shares at target) was between the 50th and the 75th percentiles of the market data for our peer group. Our CEO’s total compensation is below the median of our peer group.
The Compensation and Human Resources Committee believes this positioning is appropriate because the Company is above the median of peer group companies on all scope metrics and the Company’s exceptional long-term performance further supports the effectiveness of this positioning.
Use of Tally Sheets and Wealth Accumulation Analysis
When approving compensation decisions, the Compensation and Human Resources Committee reviews tally sheet information for each of our executive officers. These tally sheets are prepared by management and quantify the elements of each executive officer’s total compensation. The tally sheets include a summary of all equity awards previously granted to each executive officer, the gain realized from past vesting or exercise of equity awards, and the projected value of accumulated equity awards based upon then current stock price scenarios. The tally sheets help the Compensation and Human Resources Committee members analyze the compensation each executive officer has accumulated to date and to fully understand the amount the executive officer could potentially accumulate in the future.
Elements of our Compensation Program
The compensation program for our named executive officers consists of the following elements:
Compensation Element
Purpose
Base salary
Annual compensation,
not variable
To provide a base level of cash compensation for executive officers tied to role, scope of responsibilities and experience.
Annual cash incentive awards
Annual performance compensation, variable
To encourage and reward executive officers for achieving annual corporate performance, human capital and customer-oriented goals and individual performance results.
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Compensation Element
Purpose
Equity awards
Long-term performance compensation, variable
To motivate and retain executive officers and align their long-term interests with shareholders through the use of:

Performance shares to encourage sustained performance and growth and potentially assist executives in building ownership in the Company

RSUs to retain executive officers and build stock ownership positions

Non-qualified stock options to encourage sustained stock price appreciation
Employee benefits
Annual indirect compensation, not variable
To promote the health, well-being and financial security of employees, including executive officers; constitutes the smallest part of total remuneration.
As reflected in the charts below, the mix of total target compensation granted in 2021 to our named executive officers, excluding Mr. Wichmann, was heavily weighted towards performance-based and long-term incentive compensation, with long-term incentive awards making up approximately 75% of total target compensation for our named executive officers in aggregate.
[MISSING IMAGE: tm223410d1-pc_compenpn.jpg]
Annual Compensation
Base Salary
The Compensation and Human Resources Committee generally determines base salary levels for our named executive officers early in the fiscal year. The Compensation and Human Resources Committee increased Mr. Witty’s salary to $1,500,000 effective February 3, 2021 upon his promotion to Chief Executive Officer. Messrs. McMahon’s and Rex’s salaries were increased by the Committee effective February 28, 2021 to reflect Mr. McMahon’s promotion to President and Mr. Rex’s expanded duties. Effective February 28, 2021, Mr. Thompson’s salary was increased to $1,000,000 effective April 7, 2021 upon his promotion to Chief Executive Officer, UnitedHealthcare. Ms. Short’s salary increase was effective April 7, 2021 when she resumed her role as Chief Legal Officer. These changes are reflected in the chart below.
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Name
2020 Base Salary
2021 Base Salary
Andrew Witty 1,100,000 1,500,000
John F. Rex 1,000,000 1,200,000
Dirk C. McMahon 1,000,000 1,200,000
Brian R. Thompson 800,000 1,000,000
Marianne D. Short 850,000 900,000
Annual Cash Incentive Awards
2021 Annual Incentive Plan Performance Goals
Annual cash incentive awards may be paid if our Company meets or exceeds annual performance goals established for the year as determined by the Compensation and Human Resources Committee. In establishing the performance measures for the 2021 annual cash incentive awards, the Compensation and Human Resources Committee sought to align broadly the compensation of our executive officers with key elements of the Company’s 2021 business plan. Development of the Company’s 2021 business plan was a robust process that involved input from all of the Company’s business units and was reviewed with the Company’s Board of Directors on multiple occasions. These performance goals are based on enterprise-wide metrics because the Compensation and Human Resources Committee believes the named executive officers share responsibility to support the goals and performance of the Company as key members of the Company’s leadership team.
We assess our progress toward enhancing customer experiences using the Net Promoter System (NPS), which holistically measures the experiences we deliver to the Company’s customers, including how likely a person is to recommend our Company to their friends or family. Similarly, listening to our team members is one of the key ways we help build and reinforce a culture of inclusion and encourage employee engagement. We recognize that improved employee sentiment leads to increased talent and improved productivity, and for well over a decade, we have measured employee sentiment annually. We use our human capital management metric — the Employee Experience Index (EXI) — to measure an employee’s sense of commitment and belonging to the Company, establishing a direct link between our executive compensation program and our commitment to human capital management. We believe both metrics — NPS as well as EXI — demonstrate meaningful measures of executive performance.
The following table sets forth the performance measures and goals established for 2021, as well as 2021 performance results:
2021 Performance
Measure
Weight
Threshold
Performance
Target
Performance
Maximum
Performance
2021
Performance
Revenue* 30% $266.0 billion $280.0 billion $294.0 billion $284.0 billion
Operating Income* 30% $19.9 billion $23.4 billion $26.9 billion $23.3 billion
Cash Flows from Operations* 15% $17.4 billion $20.5 billion $23.6 billion $19.7 billion
Stewardship:

Net Promoter System (NPS)

Employee Experience Index (EXI)
25% 1.2 points above
2020 results for
NPS; 4.2 points
below 2020
results for EXI
2.5 points above
2020 results for
NPS; at 2020
results for EXI
3.8 points above
2020 results for
NPS; 4.2 points
above 2020
results for EXI
1.7 points below
2020 results for
NPS (below threshold);
2.4 points below
target for EXI
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*
The Company’s annual incentive plan allows for adjustments to the Company’s reported results for the impact of changes in accounting principles, extraordinary items and unusual or non-recurring gains or losses, including significant differences from the assumptions contained in the financial plan upon which the incentive targets were established. Adjustments to reported results are intended to better reflect executives’ line of sight, align award payments with growth of the Company’s business, avoid artificial inflation or deflation of awards due to unusual or non-recurring items in the applicable period and emphasize the Company’s preference for long-term and sustainable growth. The Compensation and Human Resources Committee adjusted 2021 revenue, operating income and cash flows from operations to exclude impacts resulting from the COVID-19 pandemic, unrealized investment gains, and other non-recurring items. These adjustments remove benefits to management from items over which they had no control which were not contemplated in the 2021 plan and had the net effect of decreasing the financial results and negatively affecting executive compensation.
Context for the 2021 Annual Cash Incentive Plan Performance Goals
The 2021 financial performance measures at target level represented, respectively, year-over-year growth in revenues of $22.9 billion, or 9%; year-over-year growth in operating income of $1.0 billion, or 4%; and year-over-year decrease in operating cash flows of $1.7 billion or 8%, and all of these measures were impacted by the COVID-19 pandemic. 2021 targeted cash flows declined from 2020 actual results as 2020 cash flows were impacted by the COVID-19 pandemic, primarily due to timing factors.
The 2021 non-financial performance measures were based on survey results and, at target levels, represented levels at or above 2020 performance. These measures were viewed to be important to longer-term financial success, customer satisfaction and employee welfare that might not be immediately reflected in annual financial results. The Compensation and Human Resources Committee believes that the breadth of financial and non-financial performance measures for the 2021 annual cash incentive award would motivate executive officers to achieve results that contribute to value creation for our shareholders on a long-term basis, reward performance advancing the Company’s mission and values, and avoid excessive risks.
At the beginning of 2021, the Compensation and Human Resources Committee believed achievement of the annual incentive goals required substantial performance on a broad range of initiatives contained in the 2021 business plan. These initiatives included the following:

Execute on Optum’s growth initiatives, with major focus areas including further expansion of patients served in value-based care arrangements and the continued build-out of care delivery capabilities, technology-enabled services, and advancing the scope of pharmacy care services offerings;

Grow people served in UnitedHealthcare;

Continue to enhance the quality and operations of our government benefit businesses;

Continue to innovate in commercial benefit products, services, and distribution;

Deliver ever more effective and comprehensive clinical management, and continue expanding value-based elements in our network;

Further enhance customer service and increase the Company’s NPS across all business platforms; and

Further improve our consolidated operating cost ratio after considering the impact of changes in business mix, repeal of the health insurance tax, and effects from COVID-19.
With respect to these initiatives, Optum achieved double digit percentage revenue and operating earnings growth, and added new patients in accountable, value-based arrangements. The Company significantly exceeded its targets for people served by UnitedHealthcare, and improved net promoter scores in many, but not all, of its businesses. UnitedHealthcare
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demonstrated excellence in its Medicare plans by further improving its Medicare Star ratings. The Company achieved or made substantial progress on all other initiatives listed above.
Revenues for 2021 grew 12% from the prior year, while operating income grew 7% and cash flows from operations increased 1%. 2021 revenues, operating income and cash flows from operations were each impacted by the COVID-19 pandemic.
Non-financial performance measures were above threshold for EXI, and below threshold for NPS. Diluted earnings per share and adjusted earnings per share increased 13%1 in 2021.
While the Company uses defined performance measures and weightings to determine an overall funding level for the Company’s bonus pool, individual annual cash incentive awards are not purely formulaic. In determining the amount of the actual annual incentive award to be paid to each officer, the Compensation and Human Resources Committee considers the CEO’s recommendations for executive officers, the business performance underlying each of the performance measures, macroeconomic factors impacting business performance, individual executive performance, market positioning, and related matters. The Compensation and Human Resources Committee retains discretion to pay an annual incentive award higher or lower than the performance level achieved based on these considerations if threshold performance is achieved on any performance measure. However, the overall pool cannot be exceeded.
Determination of 2021 Annual Cash Incentive Award Opportunities
At the beginning of each year, the Compensation and Human Resources Committee approves an annual cash incentive target opportunity for each executive officer as a percentage of the executive officer’s base salary.
The target opportunities established for the named executive officers are intended to increase collaboration, teamwork and accountability across the enterprise, to recognize the skills and versatility of each executive officer and to reflect relative contributions to the success of the overall enterprise. At the end of the fiscal year, the Compensation and Human Resources Committee reviews the Company’s performance against the goals set at the beginning of the year and determines annual cash incentive awards. The Compensation and Human Resources Committee has the discretion to increase or decrease the awards made in view of actual performance, individual contributions and overall business and market conditions.
The Compensation and Human Resources Committee evaluated the Company’s 2021 performance against the performance goals, overall business results, economic conditions and individual performance objectives. The Committee noted the strong 2021 business results discussed above while also noting that performance was below threshold for NPS and below target for EXI. Accordingly, the Committee determined that the 2021 annual cash incentive for officers should be awarded at 85% of the targets set.
The target percentages for annual cash incentive awards to our named executive officers and the actual 2021 annual cash incentive awards paid are set forth in the table below. Mr. Wichmann did not receive an annual cash incentive award in 2021. An explanation of how the individual amounts were determined follows the table.
1.
Adjusted earnings per share is a non-GAAP financial measure. Refer to Appendix A in this proxy statement for a reconciliation of adjusted earnings per share to the most directly comparable GAAP measure.
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2021 Annual Cash Incentive Awards
Name
Target Percentage
(% of Salary)
Target Award Value
($)
Actual Award Paid
($)
Paid Award
(% of Target)
Andrew Witty 200 3,000,000 2,550,000 85%
John F. Rex 200 2,400,000 2,050,000 85%
Dirk C. McMahon 200 2,400,000 2,050,000 85%
Brian R. Thompson 200 2,000,000 1,700,000 85%
Marianne D. Short 135 1,215,000 1,030,000 85%
In determining the 2021 annual cash incentive award amounts for the named executive officers, the Compensation and Human Resources Committee took into account the Company’s performance against the 2021 annual performance goals set forth in the table above and business results described under “Context for the 2021 Annual Cash Incentive Plan Performance Goals,” including each executive officer’s role in achieving those results.
The Compensation and Human Resources Committee did not make specific assessments of, quantify or otherwise assign relative weightings to the factors listed above as it reached its decisions with respect to any of the named executive officers. See the 2021 Summary Compensation Table and other related compensation tables below for details regarding 2021 total compensation for the named executive officers.
Long-Term Incentive Compensation
Long-term incentive compensation, consisting solely of equity awards in 2021, represents the largest portion of executive officer compensation. The combination of long-term incentives we employ provides a compelling performance-based compensation opportunity, aids in aligning and retaining the senior management team and accelerates the advancement of business unit capabilities across the enterprise.
The Compensation and Human Resources Committee determined that long-term equity-based compensation for 2021 should include grants of performance shares, RSUs, and non-qualified stock options to achieve balance and effectiveness in our equity-based compensation and to align the interests of our executive officers and our shareholders. The mix of equity-based compensation granted in 2021 was as follows, based on the grant date fair value of the total award: 50% performance shares, 25% RSUs, and 25% non-qualified stock options.
Performance share grants were selected to ensure a strong pay-for-performance alignment of the Company’s compensation program with drivers of shareholder value, specifically weighted equally between cumulative earnings per share and average return on equity for the three-year performance period. Participants can earn between 0% and 200% of the target performance share award based upon actual results. The performance share payouts are determined formulaically, subject to the authority of the Compensation and Human Resources Committee to make appropriate adjustments to account for events not contemplated when the performance targets were set. RSU grants were selected because they are full value shares with time vesting (typically, ratably over four years) and, as such, provide added retention value. Non-qualified stock options were selected because they have value only if the Company’s stock price increases and, as such, provide incentives for sustained long-term stock price appreciation. Non-qualified stock options typically vest ratably over four years. Our equity award types, vesting terms, and termination provisions are summarized in the chart below.
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Award Type and Vesting Terms
Termination Provisions
Performance Share Award (3-year performance period with cliff vesting)

Unvested performance share awards will vest if, within two years of a change in control, an executive terminates employment for Good Reason or is terminated without Cause (i.e., “double trigger” vesting), as these terms are defined in the award agreement. The number of performance awards that vest will be dependent upon the performance vesting criteria that have been satisfied.

If the executive officer is retirement-eligible, upon retirement, the number of performance shares earned at the end of the performance period based on actual performance, if any, will vest as if the executive officer had been continuously employed throughout the entire performance period, provided the executive officer served for at least one year of the performance period.

Upon termination of employment for Good Reason or without Cause (as these terms are defined in the award agreement), the executive officer will receive at the end of the applicable performance period, a pro rata number of performance shares that are earned, if any, based on the number of full months employed plus the number of months for any severance period.

Upon death or disability, the executive officer will receive at the end of the applicable performance period, the number of performance shares that are earned, if any.
RSU Award
(4-year ratable vesting*)
And
Stock Option Award
(4-year ratable vesting)

Unvested award will vest in full if, within two years of a change in control, an executive terminates employment for Good Reason or is terminated without Cause (i.e., “double trigger” vesting), as these terms are defined in the award agreement.

Unless the executive officer is retirement-eligible, award is subject to earlier termination upon certain events related to termination of employment.

Unvested award will vest in full upon death or disability.
*
Except as provided in footnote 4 to the Outstanding Equity Awards at 2021 Fiscal Year-End table.
Long-Term Awards
2019-2021 Long-Term Goals and Context
The long-term performance share program creates financial incentives for achieving or exceeding three-year financial goals for the enterprise as follows. The table below shows the goals for the 2019-2021 plan, as well as the Company’s actual performance against plan:
2019-2021
Performance Measure
Weight
Threshold
Performance
Target
Performance
Maximum
Performance
2019-2021
Performance
Cumulative Adjusted Earnings Per Share
50%
$45.33
$47.95
$51.60
$49.31
Return on Equity 50% 22.2% 24.2% 26.2% 24.8%
The performance measures and goals for the 2019-2021 performance period were established during the first quarter of 2019 based on the Company’s long-term business plan. The first year of the long-term business plan was based on the Company’s 2019 business plan. Subsequent years were based on assumptions and growth initiatives developed by the Company’s business units and reviewed by the Board of Directors.
Key assumptions and elements of the 2019-2021 long-term business plan were:

Continued expansion of the Optum Care Delivery platform and capabilities;

Medicaid, Medicare Advantage, Medicare Supplement and Global growth in people served over the three-year period;

Commercial risk-based and fee-based health insurance growth in people served in all years, leveraging enhanced products, services, and distribution including a continued focus on diversification into ancillary businesses;

An expectation that medical cost trends would be consistent with historical levels;
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Modest US economic growth with a gradual increase in interest rates, and a more rapidly growing economy in Brazil, with a stable Brazilian Real — U.S. Dollar exchange rate;

Delivery of more effective and comprehensive clinical management;

Continued growth and enhancement of the quality and operations of our government businesses;

Continued growth in technology-enabled services and specialty networks products and services, driving distinctive revenue, margin, and earnings performance;

Ongoing improvements to our consolidated operating cost ratio on a comparable business mix basis; and

Effective cross-enterprise collaboration among various business units for the benefit of customers and our overall reputation and performance.
To achieve maximum performance for the performance share plan, the Company would have had to achieve cumulative three-year adjusted earnings per share (“AEPS”) performance of $51.60 and an average return on equity (“ROE”) of 26.2%. These maximum performance levels corresponded to a compound annual growth rate in AEPS of 15% over the three-year period. For long-term compensation purposes (see adjustments described below), the Company generated cumulative AEPS of $49.31, which was between target and maximum performance levels, and accompanying ROE of 24.8%, which was between target and maximum performance levels. This represented a compound annual AEPS growth rate of 14% over the three-year performance period, consistent with the Company’s projected long-term growth rate of 13% to 16%.
Factors which positively or negatively influenced our results subsequent to the approval of the long-term business plan in early 2019 included:

Onset of the COVID-19 pandemic beginning in early 2020;

Significant acquisition activities over the three-year period;

Difficult Brazilian economy and significant devaluation of the Brazilian Real against the U.S. Dollar;

Growth in investment and other income from the Company’s continued collaborative growth and innovation efforts with Optum Ventures; and

The permanent repeal of the Health Insurance Tax.
Similar to the annual incentive plan, the Company’s long-term incentive plan allows for adjustments to the Company’s reported results in determining long-term incentive plan awards, namely adjustments that account for the impact of changes in accounting principles, extraordinary items, and unusual or non-recurring gains or losses. Two adjustments were made in measuring 2019-2021 performance, which resulted in lowering the payouts to the named executive officers:

Excluded from 2020 and 2021 results were the impacts from unusual events not contemplated when the performance targets were set; and

Excluded from 2019, 2020 and 2021 results were impacts from capital allocation actions not contemplated when the performance targets were set, primarily from merger and acquisition activity and share repurchase activity.
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