Essential Utilities, Inc.
For the period ended May 1, 2024. Filed Mar 19, 2024.
View on SEC.govAbout this filing
What shareholders are asked to vote on at a company's meeting. It is where to find what directors and top executives are paid, and who owns the most shares.
May 1, 2024 · Filed Mar 19, 2024
Contents
Cover page
Show cover page
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. )
| ☒ | Filed by the Registrant | ☐ | 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 Rule 14a-12 |
ESSENTIAL UTILITIES, INC.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other than the Registrant)
| Payment of Filing Fee (Check the appropriate box): | |
|---|---|
| ☒ | No fee required. |
| ☐ | Fee paid previously with preliminary materials. |
| ☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11. |
To Our Shareholders
March 19, 2024
| To Our Shareholders, | |
|---|---|
| On behalf of your Board of Directors, I invite you to attend the 2024 Annual Meeting of the Shareholders of Essential Utilities, Inc. to be held virtually on May 1, 2024. 2023 was a pivotal year for progress and growth at Essential. Despite a challenging economic environment that impacted consumers and businesses globally, we leaned on our extensive history, operational expertise and financial strength to improve our nation’s infrastructure, serve our customers and communities, and continue to provide value to you, our shareholders. We have a proven track record of capital investment and operational excellence that has positioned us as one of the strongest utilities in the United States. In 2023, we invested more than $1 billion to improve water and natural gas infrastructure across our footprint. Our investment program is the primary driver of our growth – but it is also critical work, enabling us to provide safe and reliable water, wastewater, and natural gas services, address new and emerging contaminants, and reduce our environmental impact. As one of the most significant utility companies in the U.S., we are proud to play a leading role in addressing our nation’s infrastructure crisis. Essential employs an ambitious growth-through-acquisition strategy, and we continue to expand our water and wastewater footprint by serving as a solution to municipal utilities grappling with aging infrastructure and mounting debt. Last year alone, our regulated water business acquired seven systems, collectively adding over $44.5 million in rate base and more than 11,000 new customers or equivalent dwelling units to our footprint. We also have six signed purchase agreements for additional water and wastewater systems in two of our existing states that are pending closing. Together, these systems represent more than 215,000 retail customers or equivalent dwelling units. While we do not plan to add additional gas utilities to our business, the deep history and strong reputation of our Peoples Gas operation has enabled us to expand our water utility footprint in western Pennsylvania. Our gas segment remains focused on operating safely and efficiently, reducing emissions through pipeline replacement, and developing a regional energy hub that embraces high-potential alternate fuels. Our water segment continues to take a proactive approach in addressing water contaminants of emerging concern in the U.S. This includes investing in treatment for PFAS (also known as | “forever chemicals”) and making significant progress in our effort to replace lead or galvanized service lines. As an example of the work we’re doing, our Pennsylvania water utility is attempting to eliminate all known customer and company lead services by the end of 2024. In the fall of 2023, we published our latest sustainability report, which tracks key progress on our commitments to the environment, our employees, and the communities we serve. I am tremendously proud of the work we have accomplished in these areas, including making impressive progress toward our 2035 target of a 60% reduction in greenhouse gas emissions vs. our 2019 baseline. We are committed to continuing to advance our sustainability efforts – and to doing so transparently. We’re also a proud community partner, and our commitment to responsible corporate citizenship extends to all aspects of our business. In 2023, we donated more than $5.5 million to organizations that are improving lives in the communities we serve. Our culture of giving is instilled in our team members too, evidenced by our employees spending thousands of hours giving back to deserving community organizations. All these achievements take dedication at every level of our organization. I am extremely grateful for our team of employees whose dedication and expertise are paramount to our success. I look forward to sharing more about our progress, and what’s ahead for Essential, during our Annual Meeting in May. I hope you’ll join us then. On behalf of the senior leadership team, Board of Directors, and all Essential employees, thank you for your confidence, trust, loyalty and support. Sincerely, Christopher H. Franklin Chairman and Chief Executive Officer |
Essential Utilities, Inc. |3|2024 Proxy Statement
| Notice of Annual Meeting of Shareholders | Essential Utilities, Inc. 762 W. Lancaster Avenue Bryn Mawr, Pennsylvania 19010 |
|---|
| Purpose | |
|---|---|
| 1 | To elect nine nominees for directors; |
| 2 | To approve an advisory vote on the compensation paid to the Company’s named executive officers for 2023; |
| 3 | To ratify the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the Company for the 2024 fiscal year; |
| 4 | To ratify the Amendment to the Company’s Amended and Restated Bylaws’ nomination process to implement the universal proxy rules governing contested elections of directors; |
| 5 | To transact any other business as may properly come before the meeting or any adjournments or postponements thereof. |
Who can vote
Only shareholders of record at the close of business on March 4, 2024, will be entitled to notice of, and to vote at, the meeting.
Your vote is important
We urge each shareholder to promptly sign and return the enclosed proxy card, or to use telephone or internet voting.
See our Questions and Answers about the Annual Meeting and the voting section of the proxy statement for information about voting by telephone or internet, how to revoke a proxy and how to vote your shares at the virtual annual meeting.
How to vote
ONLINE BEFORE THE MEETING* www.proxyvote.com ONLINE AT THE MEETING Attend the Annual Meeting virtually at www.virtualshareholdermeeting.com/WTRG2024 and follow the instructions for voting
BY MAIL Return your signed proxy card in the postage-paid envelope provided
*If you hold shares directly, you have until 11:59 p.m. (ET) on April 30, 2024, to vote through the internet or by phone. If you are a plan participant, you have until 11:59 p.m. (ET) on April 28, 2024, to vote through the internet or by phone. If you vote by Internet or by phone, you do not need to mail back your proxy card.
By Order of the Board of Directors,
Kimberly A. Joyce
Secretary
March 19, 2024
VIRTUAL ANNUAL MEETING OF SHAREHOLDERS WEDNESDAY, MAY 1, 2024 8:00 AM ET Record Date March 4, 2024 This year’s Annual Meeting will be conducted virtually, entirely by live audio broadcast. To attend, go to: www.virtualshareholdermeeting.com/ WTRG2024 and log in using the control number on your Notice of Internet Availability, proxy card or voting instruction form. The list of shareholders will be available for inspection upon request by any shareholder for any purpose germane to the Annual Meeting for a period of 10 days prior to the Annual Meeting at our principal office located at 762 W. Lancaster Avenue, Bryn Mawr, PA 19010, by contacting us at www.essential.co/investor-relations Shareholders will have the same opportunities to participate as they would at an in-person meeting, with the opportunity to vote and ask questions on the matters discussed in this proxy statement.
Essential Utilities, Inc. | 4 | 2024 Proxy Statement
Contents
| Proxy Summary | 6 |
|---|---|
| Proposal 1 Election of Directors | 13 |
| Corporate Governance | 23 |
| Shareholder Outreach | 31 |
| Age and Term Limits | 31 |
| Environmental, Social, and Governance Program | 32 |
| Other Governance Policies and Practices | 37 |
| Communications with the Company or Independent Directors | 38 |
| Director Compensation | 39 |
| 2023 Director Compensation Program | 39 |
| Ownership of Common Stock as of March 4, 2024 | 41 |
| Proposal 2 Advisory Vote to Approve Named Executive Officers’ 2023 Compensation | 42 |
| Executive Compensation (see separate table of contents) | 43 |
| Proposal 3 Ratification of the Appointment of PricewaterhouseCoopers LLP as Independent Registered Public Accounting Firm for Fiscal 2024 | 85 |
| Audit Committee Report | 87 |
| Proposal 4 Ratification of an Amendment to the Bylaws to implement universal proxy rules governing contested elections of directors | 88 |
| Annual Meeting Information | 90 |
| Questions and Answers about the 2024 Annual Meeting | 90 |
| Nominating Candidates for Director | 93 |
| Additional Information | 94 |
| Other Matters | 94 |
| Appendix A Reconciliation of GAAP to Non-GAAP Financial Measures | A-1 |
| Appendix B Amendment to Amended and Restated Bylaws of Essential Utilities, Inc. | B-1 |
Forward-Looking Information
This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act) and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). Forward-looking statements are based on management’s beliefs and assumptions. Various factors may cause actual results to be materially different than the suggested outcomes within forward-looking statements. Accordingly, there is no assurance that such results will be realized. For details on the uncertainties that may cause the Company’s actual future results to be materially different than those expressed in our forward-looking statements, see our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission (SEC) and available on the SEC’s website at www.sec.gov. In light of these risks, uncertainties, and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than described. Forward-looking statements speak only as of the date they are made. Essential Utilities, Inc. expressly disclaims an obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
Essential Utilities, Inc. |5|2024 Proxy Statement
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.