UNH UnitedHealth Group Inc

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 §240.14a-12

​

UnitedHealth Group Incorporated

(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 all boxes that apply):

☒

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.

​

 

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.

 

 

 

Table of Contents

​	Proxy Summary	​	​	​	​	1	​	​
​	Board of Directors	​	​	​	​	​	​	​
​	PROPOSAL 1: Election of Directors	​	​	​	​	4	​	​
​	2022 Director Nominees	​	​	​	​	4	​	​
​	Director Nomination Process	​	​	​	​	8	​	​
​	Board Leadership Structure	​	​	​	​	12	​	​
​	Director Independence	​	​	​	​	13	​	​
​	Board Committees	​	​	​	​	13	​	​
​	Board Meetings and Annual Meeting Attendance	​	​	​	​	16	​	​
​	Board and Committee Evaluations	​	​	​	​	16	​	​
​	Communication with the Board of Directors	​	​	​	​	17	​	​
​	Director Compensation	​	​	​	​	17	​	​
​	2021 Director Compensation Table	​	​	​	​	20	​	​
​	Corporate Governance	​	​	​	​	​	​	​
​	Overview	​	​	​	​	22	​	​
​	Code of Conduct: Our Principles of Ethics & Integrity	​	​	​	​	24	​	​
​	Compliance and Ethics	​	​	​	​	24	​	​
​	Risk Oversight	​	​	​	​	25	​	​
​	Alignment of Environment, Social and Governance (ESG) with Our Long-Term Strategy	​	​	​	​	26	​	​
​	Executive Compensation	​	​	​	​	​	​	​
​	Executive Summary	​	​	​	​	29	​	​
​	Compensation Discussion and Analysis	​	​	​	​	32	​	​
​	Compensation and Human Resources Committee Report	​	​	​	​	47	​	​
​	Compensation and Human Resources Committee Interlocks and Insider Participation	​	​	​	​	48	​	​
​	2021 Summary Compensation Table	​	​	​	​	48	​	​
​	2021 Grants of Plan-Based Awards	​	​	​	​	51	​	​
​	Outstanding Equity Awards at 2021 Fiscal Year-End	​	​	​	​	53	​	​

​	2021 Option Exercises and Stock Vested	​	​	​	​	54	​	​
​	2021 Non-Qualified Deferred Compensation	​	​	​	​	55	​	​
​	Executive Employment Agreements	​	​	​	​	56	​	​
​	Potential Payments Upon Termination or Change in Control	​	​	​	​	57	​	​
​	CEO Pay Ratio	​	​	​	​	59	​	​
​	PROPOSAL 2: Advisory Approval of the Company’s Executive Compensation	​	​	​	​	61	​	​
​	Audit	​	​	​	​	​	​	​
​	Audit and Finance Committee Report	​	​	​	​	62	​	​
​	Disclosure of Fees Paid to Independent Registered Public Accounting Firm	​	​	​	​	64	​	​
​	Audit and Finance Committee’s Consideration of Independence of Independent Registered Public Accounting Firm	​	​	​	​	64	​	​
​	Audit and Non-Audit Services Approval Policy	​	​	​	​	64	​	​
​	PROPOSAL 3: Ratification of Independent Registered Public Accounting Firm	​	​	​	​	65	​	​
​	Annual Meeting	​	​	​	​	​	​	​
​	PROPOSAL 4: Shareholder Proposal Seeking Shareholder Ratification of Termination Pay	​	​	​	​	66	​	​
​	PROPOSAL 5: Shareholder Proposal Regarding Political Contributions Congruency Report	​	​	​	​	69	​	​
​	Questions and Answers About the Annual Meeting and Voting	​	​	​	​	72	​	​
​	Householding Notice	​	​	​	​	79	​	​
​	Other Matters at Meeting	​	​	​	​	79	​	​
​	Other Information	​	​	​	​	​	​	​
​	Security Ownership of Certain Beneficial Owners and Management	​	​	​	​	80	​	​
​	Certain Relationships and Transactions	​	​	​	​	82	​	​
​	Appendix A — Reconciliation of Non-GAAP Financial Measure	​	​	​	​	84	​	​

 

​

​

​

 

Board 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.

 

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.

 

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.

 

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.

(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.

 

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.

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.

 

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;

​

 

•

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.

 

The following table identifies the members of each committee as of April 8, 2022:

​

*

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.

​

 

 

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.

 

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.

 

The following table highlights the material elements of our director compensation program:

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.

 

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.

 

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.

(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:

​

(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.

​

 

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:

*

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:

(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.

​

 

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.

 

 

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.

 

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.