2022 Human Capital Management Report

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Our competitive internship program is one way we're building our workforce and attracting the best talent.

2022 summer interns HOUSTON, TX

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We evaluate and enhance our Total Rewards benefits program each year to support our employees' physical, social, financial and emotional well-being in all stages of life.

A Lake Charles Manufacturing Complex employee WESTLAKE, LA

Phillips 66 offers people a place to thrive as part of a high-performing workforce that is changing the future of energy.

To Our Employees, Communities and Shareholders

The world of energy has been evolving since long before I entered the industry in 1989. Change is our industry’s constant, and while it seems we’re once again in a period of accelerated change, we’re confident the people of Phillips 66 are ready. World events of 2022 underscored the importance of affordable, reliable energy in our day-to-day lives. It’s our job to deliver the energy products that are fundamental to human progress, and we’re bringing everything from oil and gas and renewable fuels to hydrogen and batteries.

In 2022, we began a companywide Business Transformation program to strengthen our financial position and help our people do their best work as we enhance our operations and invest in growth, including lower-carbon opportunities. We welcomed a refreshed Executive Leadership Team and identified our next generation of leaders across the company. We restructured our organization to be better positioned to capture opportunities in high-growth chemical markets, execute our natural gas liquids wellhead-to-market strategy, improve refining performance, promote general-interest decision making and further develop our Emerging Energy organization. We’re also enhancing capabilities in our staff functions, including a new enterprisewide approach to learning and development to help our people learn faster and build leadership capabilities earlier in their careers.

We’re making good on our vision of providing energy and improving lives by boldly trying new things and inviting new perspectives to develop innovative solutions. This approach helped us achieve success last year.

Mark Lashier

We reported strong earnings in 2022, ran our refineries well to keep up with post-pandemic demand, and bolstered our NGL business by expanding our fractionation capacity and increasing our interest in DCP Midstream. On the renewables side, we finalized a joint venture in Europe to create a network of hydrogen refueling stations, made our first delivery of sustainable aviation fuel to British Airways, and progressed the conversion of our San Francisco Refinery in Rodeo, California, into one of the world’s largest renewable fuels facilities. Our people are seeing decades of hard work pay off as we find new ways to execute, move faster and compete in evolving energy markets. Above all, we must honor our commitments to operating safely, enhancing our culture and advancing inclusion and diversity. These things are the heart of our organization, and we can never lose sight of them.

Early in my career, I learned so much at the Phillips 66 Research Center in Bartlesville, Oklahoma, not just about science but about camaraderie and the collective power of minds permanently geared toward discovery. In my first year as President and CEO of Phillips 66, it has become clear that our people share this sentiment and know that the answers for a better tomorrow come from us all.

We are creating the future of Phillips 66, and I can’t wait to see what our organization accomplishes during my tenure and beyond. Please enjoy this 2022 report as a reflection of our people's dedication to providing energy and improving lives.

Sincerely,

Mark Lashier President and CEO

A CONVERSATION WITH SONYA REED

Senior Vice President, Chief Human Resources Officer

How is Phillips 66 focused on building resiliency as it prepares to compete in the next decade?

We’re focused on building strong, trustworthy leaders and fostering an inclusive culture where people feel like they belong. We have embarked upon a significant transformation, which requires us to effectively manage change while simultaneously eliciting innovative ideas from our people. Managers play a pivotal role in this process, and we empower them to lead. We also continue to prioritize shaping our culture to allow people from all backgrounds to be their authentic selves. Strong leadership paired with a differentiated culture is a powerful combination that will be our competitive advantage for years to come.

How have the people of Phillips 66 contributed to Business Transformation?

For transformation to work, the ideas must come from within, and our employees submitted more than 3,000 ideas on how to improve ways of working and capture value. There’s a sense of empowerment throughout the company that enables everyone to question the status quo. That freedom to bring new ideas to the table, share diverse perspectives and work for the greater good is an outcome of our strong culture and a testament to our belief in the power of inclusion and diversity. We have the right people and the right capabilities to solve the energy challenges ahead, and we’re excited about the future.

How is Phillips 66 enhancing its centralized model for core services to create a more consistent employee experience?

We operate in a complex industry with locations and people across many countries, and our Business Transformation work in 2022 helped us uncover opportunities to streamline our processes. We are rethinking how we work and creating a more agile and collaborative organization. We are standing up our Centers of Excellence for our core services like Finance, Human Resources, Procurement, IT, Brand and Communications, which allows for standardized processes and builds enterprisewide knowledge. It also establishes a “Phillips 66 way,” so there is consistency in expectations and alignment on how we measure and evaluate performance.

Sonya Reed

Our Approach to Human Capital Management

Our 13-member board of directors actively engages with Phillips 66 executive leadership on human capital management strategies and oversight.

Senior leaders regularly collaborate with the board to ensure we’re delivering on our strategic pillar of being a high-performing organization.

Board members stay connected to our corporate culture by visiting our facilities and talking with employees to better understand their experience, as well as our day-to-day operations.

Our board oversees human capital management with rigor and discipline.

It is woven into the responsibilities of each of our standing board committees, which are:

• The Public Policy and Sustainability Committee.

• The Human Resources and Compensation Committee.

• The Nominating and Governance Committee.

• The Audit and Finance Committee.

• The Executive Committee.

Each committee’s charter is posted on the Corporate Governance page in the Investors section of Phillips66.com.

It’s our job as a board to help guide and assess the company’s strategy as it transforms to compete in an evolving world, but it’s the people of Phillips 66 who lead the transformation. Having the right people, with the right motivations, capabilities and resources, is paramount to the company’s success.”

GLENN F. TILTON

Lead Independent Director, Phillips 66 Board of Directors and Chair of the Nominating and Governance Committee

HUMAN CAPITAL MANAGEMENT KEY PRINCIPLES

• Our people are bonded by our vision of providing energy and improving lives and our core values of safety, honor and commitment.

• Our company strategy depends on our highperforming organization, which is defined by our culture, capability and performance.

• Our commitment to safety and operating excellence makes us an industry leader in safety performance.

• Our inclusive environment attracts and retains exceptional and diverse talent.

• Our investments in development and career growth span from the moment an employee joins Phillips 66 to when they retire.

• Our incentives and benefits are competitive and respond to the needs of our evolving workforce.

• Our Energy In Action (OEIA) sets behavioral expectations that preserve what makes Phillips 66 great and challenges us to evolve in ways that make us better.

• Our employees, shareholders and communities are critical stakeholders with whom we proactively engage.

• Our ability to innovate, transform and compete in evolving energy markets depends on our ability to collaborate, empower our people and boldly try new things.

EXPANDING OUR BOARD IN 2022

The Phillips 66 board of directors grew from 11 to 13 members in 2022, with the addition of Mark Lashier and Gregory J. Hayes. Lashier’s appointment came after he assumed the role of President and CEO on July 1, and he serves on the board’s Executive Committee. Hayes, who is Chairman and CEO of Raytheon Technologies Corporation, joined the board as an independent director and serves on the Public Policy and Sustainability, Human Resources and Compensation and Nominating and Governance committees. Greg C. Garland, who stepped down as CEO in 2022 after 10 years of leading the company, remains as the board’s Executive Chairman.

38% women

85% independent

SKILLS AND QUALIFICATIONS TENURE

4 members

members

members

Left to Right: Julie L. Bushman, John E. Lowe, Charles M. Holley, Denise R. Singleton, Marna C. Whittington, Gregory J. Hayes, Mark Lashier, Greg C. Garland, Glenn F. Tilton, Lisa A. Davis, Douglas T. Terreson, Denise L. Ramos, Gary K. Adams

Our Commitment to Human Capital Management

Our success begins and ends with our people. Their talents, ideas, commitment and excitement for the future give us a competitive advantage.

Our Executive Leadership Team (ELT) is responsible for enabling our high-performing organization, which is critical to our long-term success. The ELT and other senior leaders collaborate with the board of directors on human capital topics to ensure Phillips 66 has exceptional people to lead us into the future.

We invest in our employees professionally and personally and give them a leading role in our success. We help them develop skills to adapt to new technologies and ways of working, build leadership capabilities to reflect our culture, and maximize performance by nurturing potential. Our people do meaningful work that gives them purpose and advances our vision in an environment where everyone feels empowered to create, innovate and thrive.

Leadership Team

33% women TENURE

33% underrepresented groups

5 members

years

years

members

years 3 members

years

Strategic Priorities in Action

The people working across our diverse value chain are aligned, focused and energized about the future. Our teams are poised to deliver on the strategic priorities outlined at our 2022 Investor Day.

Deliver Shareholder Returns of $10 billion to $12 billion through dividends and share repurchases from July 2022 through year-end 2024.

Improve Refining Performance by increasing market capture and crude capacity availability, as well as reducing operating costs by $0.75/barrel annually.

Capture Value From Wellhead to Market as the DCP Midstream* transactions add an incremental $1.3 billion adjusted EBITDA, including commercial and operating synergies.

Execute Our Business Transformation targeting sustainable savings of $1 billion annually, including $800 million in cost reductions and $200 million in lower sustaining capital.

Maintain Financial Strength and Flexibility delivering expected midcycle adjusted EBITDA growth of $3 billion by 2025, prioritizing our strong investment-grade credit ratings and targeting a 25-30% net debt-to-capital ratio.

Drive Disciplined Growth and Returns through disciplined capital allocation. Our ability to deliver secure, competitive, and growing shareholder distributions in the future will be enabled by pursuing selective, return-focused growth today.

Investor Day 2022 Closing Bell Ceremony at NYSE NEW YORK, NY

*DCP Midstream adjusted EBITDA assumes the acquisition of all outstanding public common units of DCP Midstream, LP, plus our increased economic interest in DCP Midstream as a result of the merger of DCP Midstream, LLC and Gray Oak Holdings, LLC, excluding the impact from decreased ownership in Gray Oak Pipeline.

Executive Leadership Team

As Phillips 66 transforms for the future, our ELT is also evolving. Of our 12-member ELT, six members took on new or restructured roles in 2022, and two members joined us as external hires.

• Mark Lashier succeeded Greg Garland as CEO in July 2022, moving out of his previous role as President and Chief Operating Officer.

• Todd Denton was promoted to the ELT as Senior Vice President, Health, Safety and Environment and Field Operations Support, after serving as Vice President, Midstream Operations.

• David Erfert transitioned to the role of Senior Vice President and Chief Transformation Officer, after previously serving as Senior Vice President, Health, Safety and Environment and Projects.

• Zhanna Golodryga transitioned from Senior Vice President, Chief Digital and Administrative Officer to Executive Vice President, Emerging Energy and Sustainability, a role created to elevate the exploration of new energy markets and the development of new energy technologies.

TODD DENTON Senior Vice President, Health, Safety and Environment and Field Operations Support

MARK LASHIER President and CEO

JEFF DIETERT Vice President, Investor Relations

DAVID ERFERT Senior Vice President, Chief Transformation Officer

ZHANNA GOLODRYGA Executive Vice President, Emerging Energy and Sustainability

RICH HARBISON Executive Vice President, Refining

• Rich Harbison was promoted to the ELT and now serves as Executive Vice President, Refining, after serving in various Refining roles across our portfolio, most recently leading the Rodeo Renewed effort as Vice President of the San Francisco Refinery.

• Tandra Perkins joined Phillips 66 as Senior Vice President and Chief Digital and Administrative Officer.

• Tim Roberts, Executive Vice President, Midstream, expanded his organization to include Chemicals, an area we will grow and develop over time to capture new opportunities. He is now Executive Vice President, Midstream and Chemicals.

• Vanessa Sutherland joined Phillips 66 in early 2022 and now serves as Executive Vice President, Government Affairs, General Counsel and Corporate Secretary.

Our refreshed ELT shares a commitment to executing our strategy, which will position us to succeed as energy markets evolve. The ELT is dedicated to equipping, engaging and empowering all employees to build fulfilling careers, innovate and work in new ways that safely deliver industry-leading performance.

TIM ROBERTS Executive Vice President, Midstream and Chemicals

VANESSA A. SUTHERLAND Executive Vice President, Government Affairs, General Counsel and Corporate Secretary

BRIAN MANDELL Executive Vice President, Marketing and Commercial

TANDRA PERKINS Senior Vice President, Chief Digital and Administrative Officer

KEVIN J. MITCHELL Executive Vice President, Chief Financial Officer

SONYA REED Senior Vice President, Chief Human Resources Officer

Our Culture

Bayway Refinery LINDEN, NJ

Our Culture Is a Proven Differentiator

Our operating principles, commitment to safety and behavioral expectations guide us and create an environment that leverages our most incredible resource — our people.

SAFETY IS AT THE FOREFRONT OF EVERYTHING

It is our goal to work safely and send everyone home safely every day. Operating excellence — including personal and process safety, environmental stewardship and asset reliability — is critical to our corporate strategy. As one of the energy industry’s safest and most reliable companies, we are committed to continuous learning and improvement because we believe we can always do better.

In 2022, our employees delivered exceptional personal and process safety. Our combined Total Recordable Rate (TRR) of 0.11 was tied for our bestever safety performance. It was 30 times lower than the overall 2021 U.S. manufacturing average and lower than the 2021 average in the refining industry and other industries. Our combined Tier 1 and Tier 2 Process Safety was 0.13, matching our best-ever performance.

“Our unrelenting focus on safety comes from the people we employ — they are people of integrity with the capability and energy to consistently deliver outstanding performance.”

Senior Vice President, Health, Safety and Environment and

We are committed to continuous learning and improvement because we believe we can always do better.

Todd Denton

TODD DENTON

Field Operations Support

COLLEGE STATION, TX

Immersive Training Builds Safety Skills and Awareness

Many of our field facilities have unique safety training, including our Sweeny Refinery, which hosts an annual weeks-long Safety Days event, representing a critical point on our journey to zero incidents and injuries.

Safety Days provides an immersive safety training experience for the refinery’s operations and maintenance personnel. In addition to reviewing the company’s guidelines and procedures, instructors take time to figure out where misunderstandings might occur and provide refresher training in an interactive environment instead of behind a computer screen.

Participants use props to climb structures, turn valves, hang from harnesses and experience firefighting. There’s even an opportunity for maintenance and operations personnel to switch roles in an interactive Lock Out Tag Out module, which allows them to experience different perspectives and give each other a better view of the bigger picture.

SAFETY TOOLS, PROCESSES AND PROCEDURES

Our Health, Safety and Environment (HSE) Management System sets our standards and expectations for maintaining and improving safety, reliability and environmental impact. In addition to safety training, all employees are empowered to ask for help and stop any activity that seems unsafe, and they annually commit to the company’s 10 Life Saving Rules.

Our work in energy is complex, and we take significant steps to protect our people. Each manufacturing site is supported by an industrial hygiene or occupational health professional who understands the potential sources of exposure, the process for evaluating exposure and the methods to protect employees and contractors. We also have on-site security teams and control centers that monitor our offices and facilities at all times. In weather, operational or other emergencies, our Everbridge crisis communications platform keeps U.S. employees updated and aware of the actions they need to take through real-time email, voice and text message notifications.

Learn more about our commitment to safety in our 2022 Sustainability Report.

HELPING EMPLOYEES ‘SEE THEMSELVES IN CYBER’

Our Digital Security team led a global educational campaign during Cybersecurity Awareness Month in October with the theme “See Yourself in Cyber.” The campaign aimed to help employees understand emerging cyber threats and how to protect themselves and Phillips 66 against attacks.

“We spend much of our day digitally connected, and it’s everyone’s job to stay informed, alert and aware, especially as cybercriminals become more sophisticated,” said Michael Morgan, Chief Information Security Officer.

The campaign’s speaker series featured prominent subject-matter experts, including a U.S. Homeland Security advisor and the executive director of the National Cybersecurity Alliance.

A toolkit helped communicators and people leaders share messages with their teams. It included tips on how to recognize phishing schemes and best practices for passwords, multifactor authentication and software updates.

TEEX Brayton Fire Training Field

TRANSFORMATION

Improving Lives Through Our Social Impact Strategy

Our social impact strategy focuses on creating partnerships that inspire action to improve lives and identify solutions to societal challenges. Our philanthropic and volunteer efforts strengthen economic, social and environmental resilience in the communities where our employees live and work. In January 2023, we launched an evolution of our social impact strategy that expands our existing focus areas for corporate giving.

EDUCATION EQUITY

Literacy and workforce preparedness are the foundation of individual achievement and our economic future. To build a more diversified and equitable workforce in the science, technology, engineering and math (STEM) disciplines, we seek and support academic training and education opportunities for young women and girls and underrepresented minorities.

SAFETY AND WELL-BEING

We are committed to protecting people from the effects of natural disasters and believe preparedness is crucial for safety and security. We recognize that the social, emotional, physical and financial well-being of our neighbors is vital to a thriving community, so we support organizations that provide the services and care needed to ensure their basic needs are met.

SOCIAL ADVANCEMENT

Working in collaboration to solve our communities’ most pressing needs requires sharing knowledge, expertise and human capital. We understand a thriving society requires civic and business engagement with a shared commitment to creating an inclusive environment and elevating diverse populations to build a sustainable future for all.

ENVIRONMENT

We invest in nature conservation and biodiversity because we respect and value their influence in our daily lives. We believe communities deserve equal access and proximity to nature’s beauty so they can enjoy the physical and emotional benefits of recreational spaces and places. Early education and immersion in nature are particularly valuable for underprivileged children as they develop a sense of place and belonging.

I am always inspired by how our employees show up in our communities. Being a good neighbor is truly a part of who we are.”

COURTNEY MEADOWS Senior Advisor, Social Impact

Family Literacy Night at the Houston Children's Museum HOUSTON, TX

Social Impact

Phillips 66 invested $27 million in our communities in 2022.

$9.6 million in Education Equity

$3.9 million in Safety and Well-Being $5.2 million in matching gifts to 2,048 organizations

PROVIDING GOOD ENERGY IN OUR COMMUNITIES

We believe in building stronger, safer, more resilient communities. Our Good Energy employee volunteer program empowers employees to give back in ways most important to them. In 2022, more than 3,000 employees contributed to 88,000 volunteer hours. Eligible employees can take two days of paid leave for community service each year.

In 2022, we completed our second annual Good Energy Month, a campaign to encourage employees

$3 million in Social Advancement

$3.1 million in Environment

$2.2 million in volunteer grants to 877 organizations

to embark on projects of all scopes and sizes to improve their communities. Across the globe, our employees logged 8,000 volunteer hours during the month, a 60% increase over the first Good Energy Month in 2021.

WEB-EXCLUSIVE

Phillips 66 employees step up with Good Energy

66 Trees and 66 Volunteers

Our Bayway Refinery in Linden, New Jersey, celebrated Good Energy Month and Earth Day by organizing 66 volunteers to plant 66 trees at Rizzuto Park in nearby Elizabeth, New Jersey.

Phillips 66 has supported Rizzuto Park for several years, including sponsorship of the park’s Environmental Pavilion. We have also teamed up with a local organization, Groundwork Elizabeth, to work on supply and storage needs, establishing the butterfly garden, walking path upkeep, educational signage and ongoing cleanup days. A Phillips 66 philanthropic grant helped the park create a rain garden and implement a significant streambank restoration project in 2022.

Good Energy volunteer event at Rizzuto Park ELIZABETH, NJ

CULTURE EMPLOYEE EXPERIENCE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Shaping Our Culture to Be the Best We Can Be

As the world, our workforce and our businesses evolve, so does our culture, and we’re refining it to bring out the best in ourselves so we can continue to deliver on our vision of providing energy and improving lives.

COMMITMENT TO OUR ENERGY IN ACTION

Our Energy In Action (OEIA) is a set of behavioral expectations for all employees that preserves what makes Phillips 66 great and challenges us to become better. Together with our values of safety, honor and commitment, the principles of OEIA govern how we work, influence how we make decisions and help us seek different perspectives. We model and measure against these principles by integrating them into our people practices, including succession management, performance reviews, Total Rewards benefits and recruiting.

Our Energy In Action

Work for the greater good.

We embrace our values as a common bond.

Be a good neighbor and use resources wisely.

Prioritize the big picture interests of the company.

Work across teams, business units and functions.

Hold ourselves accountable for our words, work and actions.

Don’t let self-interest come first.

Living our values earns us the confidence of our business partners, communities and co-workers.

Create an environment of trust.

We depend on each other to do our jobs

Build relationships by understanding the experience of others.

Provide and welcome real-time feedback. Treat everyone as a contributing team member. Resolve differences quickly and move forward.

Don’t say one thing and do another.

Trusting each other makes us more productive and agile.

Seek different perspectives.

We create space for possibilities.

Examine the risks and challenge the status quo. Be open to new ways of thinking. Speak up and share our unique expertise. Listen and make sure everyone is heard.

Don’t simply accept the “way we have always done things.”

Championing inclusion enables us to innovate and thrive.

Achieve excellence.

We challenge ourselves and never settle.

Acknowledge and rebound from our mistakes.

Embrace change and adapt quickly. Be curious and pursue lifelong learning. Leave things better for the next person.

Don’t avoid difficult decisions.

Continuing to improve ensures we deliver extraordinary performance.

Advancing Inclusion and Diversity

A diverse workforce powered by an environment of inclusion unleashes the creativity to solve energy challenges and drives our high-performing organization to deliver exceptional results. Living the behaviors in OEIA helps us build environments where all employees feel valued, respected and supported to inspire innovation, growth and profitability.

We define diversity as the differences that shape who we are as individuals — from gender, race, ethnicity, age, national origin and disability to sexual orientation, education and religion. Seeking different perspectives advances our thinking and enables us to reach our full potential.

Our Executive Inclusion & Diversity Council sets and monitors the execution of our company’s inclusion and diversity strategy. The council is led by our President and CEO and is comprised of ELT members and leaders from business units and functions. Council members also serve as executive champions and global sponsors of our Employee Resource Groups (ERGs) to actively engage with and understand our employees’ experiences.

WEB-EXCLUSIVE

Read about our CEO's commitment to an inclusive workplace

WORKING TOGETHER FOR SHARED UNDERSTANDING

Our 10 ERGs focus on engaging and developing our people and building internal networks that serve the communities where we live and work. They are forums for sharing different perspectives and raising awareness around identity and belonging.

The Diverse Abilities Network became our 10th ERG in 2022. It was created to “throw stigma out the window,” according to one of its founders, Adriana Herrera, Senior Global Compliance Analyst. The group aims to create a welcoming and accommodating environment and focuses on four areas:

• Supporting employees with physical disabilities.

• Supporting employees with invisible disabilities, such as learning disabilities.

• Advocating for mental health.

• Providing caregiver support.

Diverse Abilities Network Sensory Santa event HOUSTON, TX

EMPLOYEE EXPERIENCE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Employee Resource Groups

10 ERGs

69 chapters

34% employee participation

ERGS UNITE FOR THE GREATER GOOD

WEB-EXCLUSIVE ERGs:

You can't spell energy without them

In 2022, we rebranded all our ERGs to allow each one to emphasize its uniqueness while still being part of a harmonized group. Each ERG is led by an ELT sponsor and supported by local and global executive leadership. Having our leaders rotate their ERG sponsorships helps them gain a better understanding of the employee experience and reinforces the value of seeking different perspectives. Six ERGs welcomed new sponsors in 2022.

Our annual Inclusion & Diversity Week presents an opportunity for our ERGs to unite to promote a culture of understanding and learning through the experience of others. The 2022 programming included events around the globe, and many featured external speakers on topics, such as navigating change, evolving inclusively and overcoming fear in pursuit of learning.

Our leaders rotate their ERG sponsorships to gain a better understanding of the employee experience.

ELT Members Foster Connection Through Fireside Chats

Shortly after taking the CEO reins, Mark Lashier engaged with ERG leaders and employees in an open and candid conversation.

Lashier described ERG leaders as “key advisors, partners and keepers of the flame” in efforts to promote diversity through mentoring and professional development. “ERGs create a strong fabric that makes Phillips 66 a better company and a better place to work,” Lashier said.

To commemorate Hispanic Heritage Month, Zhanna Golodryga, Executive Vice President, Emerging Energy and Sustainability and executive champion of the New Hire Network, joined a discussion with Vanessa Sutherland, Executive Vice President, Government Affairs, General Counsel and Corporate Secretary and executive champion of the Hispanic Network.

Both executives offered thoughts on pursuing technical knowledge while developing leadership skills, operating in a complex organization and building career paths that test conventional notions.

“You have to be intentional about hiring,” Sutherland said. “If you have a slate and everybody on that slate came from the same school, try again. If you have a slate and everybody kind of looks like you and makes you feel comfortable, try again.”

Golodryga told attendees that the energy transition presents people working in the industry with a once-in-a-lifetime opportunity because “no one understands molecules and electrons better than us.”

“We power the economy of not just our country but the world,” Golodryga said. “No matter what role you're in — support function or Refining or Midstream or any other business — you're part of something very, very special.”

INCLUSION AND DIVERSITY ORGANIZATIONAL ASSESSMENT

In 2022, we finished the deployment of a tailored, data-driven inclusion and diversity organizational assessment for our business units and functions.

The assessment used location-specific qualitative and quantitative data to provide insight into leadership alignment, engagement and work environment. The data also helped us validate our talent practices to enable us to hire, develop and retain the best people.

This process provided a consistent framework to meet business units and locations where they are while acknowledging their unique challenges and implementing initiatives that can make the biggest impact for them. Leaders then determined priorities and created focused plans to drive value and accountability for results. In 2023, our goal is to continue developing the framework to support leadership alignment and engagement and build leaders’ capabilities in pursuit of a leader-driven inclusive culture.

New Hire Network and Hispanic Network fireside chat HOUSTON, TX

ENHANCING OUR HIGH-PERFORMING ORGANIZATION

Our efforts to increase diversity and encourage inclusiveness are reflected in our metrics. In 2022, 36% of our global hires in professional roles were women, and 42% of our U.S. hires were from underrepresented groups.

Additionally, we recognize the importance of greater diversity, and we’re measuring our progress over time using a diversity dashboard that allows us to monitor hiring, promotion and attrition metrics.

Moreover, our leaders focus on acquisition, development and retention to enhance representation across the organization. The data trends below demonstrate our commitment to progress.

27% increase in underrepresented groups in the U.S. since 2013

10% increase in women in professional roles globally since 2013

Our efforts to increase diversity and encourage inclusiveness are reflected in our metrics.

Bayway Refinery LINDEN, NJ

EMPLOYEE EXPERIENCE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

More Than Just a Job

Vice President and General Tax Officer Heather Crowder said she experiences the Phillips 66 culture by embracing diverse perspectives and making the most of opportunities outside her day-to-day role.

How has the company’s focus on inclusion and diversity influenced your leadership approach?

My involvement with our Pride Network has reinforced that people differ beyond recognized diversity in ways that impact them at work. I’ve become more focused on understanding what drives people internally and how that influences their best work environment. I’m extroverted and learn in a collaborative manner, but I appreciate that everyone is different. For some, more quiet time reduces anxiety and puts them in the best mental space to be productive. I’m happy we’ve increased workplace flexibility to allow people the balance of stepping away from office dynamics if that’s what they need to be their best selves.

Also, as the global sponsor of the Pride Network, I love hearing the perspectives of our network leaders. They are often early in their career, and I learn a great deal from them. They give me the gift of being a more informed leader.

You are actively involved in projects outside your job scope at Phillips 66. Why is it important to have diverse experiences?

I love doing things outside of my “day job.” One of the most impactful experiences I’ve had was being part of the design team for Our Energy In Action during the first year in my tax leadership role. That assignment meant a great deal to me, especially at that time, because it gave people outside the Finance organization a chance to get to know me. They learned that I genuinely care about people and organizational health and that I am a true believer in the resilience of a high-functioning team. As a tax leader, I’m a steward of a particular function for the company, but I also have a responsibility to make Phillips 66 a great place to work. I can do that in simple ways, by interacting with my team and on a broader scale by contributing to companywide initiatives.

Heather Crowder HOUSTON, TX

Fostering a sense of belonging

OUR CULTURE EMPLOYEE EXPERIENCE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Phillips 66 Is a Place to Build a Career

We welcome anyone who is motivated to work hard, find creative solutions and collaborate up and down our unique value chain. Phillips 66 empowers our people to think boldly, discover new solutions and grow in their careers.

Types of Work

12,900 employees

17% people leaders

34% represented by a labor union

Locations

90% United States • 73% Field

7% United Kingdom 2% Germany/Austria 1% Canada/China/Singapore

• 27% Houston, Texas, and Bartlesville, Oklahoma Generational representation

11% Boomer 6% Gen Z

39% Gen X 44% Millennial

From attracting diverse talent to developing and promoting our people, Phillips 66 invests in our employees’ career life cycles to create a workforce ready for the future.

Recruiting Promotion

20% workforce promoted

23% women promoted 21% underrepresented groups promoted

BUILDING NEXT-GENERATION LEADERS

Our succession planning includes developing leaders to help maximize their potential and giving them skills and experiences to be ready when new opportunities emerge.

Retention and Development

100% succession bench utilization for all senior leader moves and retirements

45 hours invested in training per employee, per year on average

The board of directors oversees our succession plans for senior executive roles as we prepare for long-term business sustainability. Board members build relationships with our executive leaders to get to know potential successors.

OUR CULTURE EMPLOYEE EXPERIENCE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

RECRUITING THE BEST PEOPLE

As a high-performing organization, we seek to hire great people. Our digital recruiting tools enhance our ability to reach an expanded network of experienced, university and trade school candidates and ensure a consistent and efficient hiring process focused on a positive experience for recruits. To encourage diverse candidate pools and provide inclusive candidate experiences, we’ve expanded the use of blind resumes, diverse interview panels and gender-neutral job descriptions.

Our University Recruiting team cultivates on-campus relationships with administrators, faculty and students. We’re also expanding our network and relationships with technical schools to strengthen our pipeline of critical craft talent. In addition, our recruiting efforts span the STEM organizations we support, such as the Society of Women Engineers, the National Action Council for Minorities in Engineering, the National Society of Black Engineers and the National Association of Black Accountants.

We have 19 schools in our U.S. university portfolio. We monitor criteria for our portfolio schools, including program rankings, diversity of the student population, geographic locations in relation to our assets and the success of people hired over time. Our recruiting reach extends beyond our university portfolio through digital networking tools and the open application process on our website.

19 schools in our U.S. university portfolio

57 schools represented by our 2022 U.S. new hires and interns

WEB-EXCLUSIVE Diversity conferences deliver networking and growth opportunities

INDUSTRY-LEADING INTERNSHIP PROGRAM IS A PIPELINE FOR THE FUTURE

Our internship program is a competitive differentiator and an essential part of building a high-performing organization. We provide paid internships at every major location, offering students meaningful hands-on opportunities to learn and contribute to our success. Each intern is assigned a supervisor and mentor and has formal and informal networking opportunities with leaders and peers. Our office-based interns also get to see our field operations firsthand by traveling to nearby operating assets, which helps them better understand the full scope of the business.

176 interns in the 2022 class

46% office-based

54% field-based

Balancing Work and School to Achieve Excellence

One way we support career growth is by encouraging people to achieve their educational goals.

Connor Watson is a Mechanical Engineer at our Humber Refinery in the United Kingdom. In 2022, he was among the top five nominees for the Engineering Equipment and Materials Users Association Early Years Industry Award. His career journey is a prime example of how our employees can work to their full potential and achieve success.

Watson started at Phillips 66 as a Mechanical Apprentice in 2015 while he was completing a vocational certificate and diploma. Four years later, he transitioned into the role of Rotating Equipment Technician.

But he had his sights set on more.

Phillips 66 supported Watson as he completed a two-year program to earn his bachelor’s degree in mechanical engineering, and in 2022, Watson joined the Hydroskimming Business team as a Mechanical Contact Engineer.

“I feel very lucky, as Phillips 66 has supported me at every step of my journey right from being an apprentice to now as an engineer,” Watson said.

CONNOR WATSON Mechanical Engineer

I am excited to carry on my journey as I continue to develop my skills and learn about the refinery.”

EMPLOYEE EXPERIENCE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

From Intern to New Hire

The percentage of interns who join us full-time or return for another internship is one of the program’s biggest measures of success. Maddie Mills interned twice before joining Phillips 66 full-time as a Process Engineer at our Lake Charles Manufacturing Complex in Louisiana in 2022.

Like many college students, Mills wasn’t exactly sure what she wanted to do for a career, but since her parents worked in energy, her fiercely independent side made her certain she wanted to do something different. However, a connection with Phillips 66 at Cornell’s career fair helped change her mind and sparked her interest in refining.

Mills had already completed a series of internships with an upstream company and said the biggest takeaway from those experiences is that “there are amazing people in the oil and gas industry.” Her first internship at Phillips 66’s Bayway Refinery proved the same.

“I was surrounded by people who loved working hard and helping each other,” Mills said. “So I was very excited when I was offered a second internship at the Billings Refinery. After both internships, I was confident that wherever I ended up within the company, I would be challenged and work with great people.”

Mills learned by doing, gaining technical skills and building relationships with new hires and the experienced people around her. She became fascinated by the refining process and its importance to the world.

“I grew up in a part of the country where everyone only talks about renewables,” she said. “I think it is an exciting challenge to continue supplying energy and materials to the world while doing it as safely and environmentally friendly as we can. Improving what we do and how we do it is one of the best parts of my job.”

Mills certainly isn’t afraid of a challenge or hard work. She grew up playing competitive hockey, earning a spot on Cornell’s Division 1 women’s hockey team.

Hockey taught me how to show up every day to improve, learn and succeed. I never wanted to show up to the ice rink and go through the motions, and I have that same attitude at work. I want to be a better co-worker and a better engineer every day.”

MADDIE MILLS Process Engineer

67% of interns become full-time hires

SUPPORTING MILITARY HIRES

We aim to support veterans’ personal and professional development by leveraging the skills and experiences gained through military service. Phillips 66 is consistently recognized for its support of military hires, including being named a Best for Vets Employer by the Military Times, with a No. 1 ranking of all refiners and a top 10 ranking of all employers in Texas. Our participation in the Hiring Our Heroes Corporate Fellowship Program provides transitioning service members with professional training and hands-on experience in the civilian workforce.

HONORED AS A PATRIOTIC EMPLOYER

In September 2022, the Employer Support of the Guard & Reserve (ESGR) recognized Lubricants Team Lead Christina Hudnall as a Patriotic Employer for supporting her team member, National Guard Staff Sgt. Marcus Montano, during recent deployments and training.

“I am honored to have a military service member on my team,” said Hudnall. “Marcus brings a diverse skill set that creates camaraderie and has a strong sense of pride and leadership. He is always willing to assist his teammates even when that means additional work for him.”

At the same ceremony, ESGR also presented Phillips 66 with the Above and Beyond Award for providing employee support beyond the requirements of the Uniformed Services Employment and Reemployment Rights Act.

“The benefits Phillips 66 offers, including paid time off for military leave and a guaranteed position upon my return, are crucial to maintaining stability during transitions to and from the National Guard that I haven’t encountered elsewhere,” Montano said. “On top of that, the workplace culture is understanding of the demands of my service and welcoming of my experiences in a way that goes beyond my expectations.”

2022 summer interns visit the Sweeny Refinery OLD OCEAN, TX

Greg Ingels, veteran and employee at the Ponca City Refinery PONCA CITY, OK

MARCUS MONTANO National Guard Staff Sgt.

CHRISTINA HUDNALL Lubricants Team Lead

LEADERSHIP INSIGHTS

Building a Career and Helping Others Build Theirs

Renee Flores has been with Phillips 66 for 14 years, working his way up the ranks to his current position as Western Terminal Operations Superintendent.

How have you seen the company’s culture evolve as you’ve grown in your career with Phillips 66?

Since I started with Phillips 66, I’ve seen how important it has been to the company to encourage inclusion and diversity in the workplace. In my local region, leadership is at 80% diversity compared to less than 25% when I started. I can listen and seek those different perspectives, which also allows everyone to be included in the decision-making process. From my own experience, I believe Phillips 66 offers great opportunities for employees who really strive to advance their careers. My career started at an entry-level position, and I couldn’t have imagined where I am now. I’ve had great mentors to guide me along the way.

As a leader, how are you helping your team manage change through Business Transformation?

I think the best thing I have been able to do is listen to my team’s needs. Everyone handles change differently, but if you can be a calm presence and be as transparent as possible, it goes a long way in making sure everyone is focused and staying safe.

What opportunities does Business Transformation unlock for employees?

Management has given employees the confidence to bring any idea to the table in the pursuit of working smarter and more efficiently to strengthen the company. During Business Transformation, we’ve seen many great new ideas that we are starting to see implemented. Those ideas came from having an opportunity to bring a new perspective and thinking differently to reach our goals.

WEB-EXCLUSIVE

A class of their own:

5 celebrate major milestones

Renee Flores LONG BEACH, CA

HELPING OUR PEOPLE MAXIMIZE THEIR POTENTIAL

We provide career development opportunities at all levels, beginning with onboarding and technical training through skill and people leader development.

Our continuous coaching model for performance management gives employees critical one-on-one connection points with their people leaders, helping them grow and develop their skill sets to match their career aspirations. Leaders and employees regularly engage in check-in, development and alignment coaching conversations. Accessible tools and guides help both parties understand their roles and responsibilities so conversations can lead to meaningful development.

Employee Development

Our development practices recognize employees for who they are and what they need to reach their full potential. We offer in-classroom, on-demand and immersive learning resources to help employees work toward and achieve their goals, including: comprehensive onboarding programs and experiences; skill- and business-unit-specific training programs; and rotational and developmental assignments.

Success From Day One

Specialized training helps new hires quickly understand the business and their roles so they can hit the ground running. In 2022, we accelerated our engineering development to teach more advanced skills earlier. Many of our programs are cohort-based, meaning employees travel through the programs together in small groups, providing them with a consistent network of peers.

Access to Continuous Learning

In 2022, we expanded access to on-demand and peer-to-peer learning through online hubs, which allow people with similar roles, challenges and responsibilities to collaborate and learn in a virtual environment regardless of their business unit or work location. Hubs are accessible anytime and on the go through a desktop or mobile experience. We have learning hubs for people leaders, engineers, and crafts and tradespeople, and we plan to expand this offering in 2023.

People Leader Development

We consistently make investments in people leader development. In 2022, we focused our leadership curriculum on building skills for new leaders and teaching tactics to lead through change and uncertainty for leaders at all levels.

Our new-leader training provides an engaging place to learn, ask questions, grow and practice skills for individuals who are new to people leader roles. We also offer in-person and on-demand learning focused on transformational leadership and communicating organizational change. These trainings teach leaders how to develop a personal change story to help them deliver more impactful, empathetic, relatable messages and build resilient teams.

Early-Career Training Programs

PREP

Refining experts and Phillips 66 leaders teach this multiyear engineering development program focused on business and financial acumen.

PROPEL

This self-paced study with a variety of virtual courses is for engineers in their first five years at Phillips 66.

KATALYST

This immersive learning experience for new hires in market-facing businesses focuses first on the energy value chain, followed by targeted career rotations and networking.

EMPLOYEE EXPERIENCE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Listening Enables Employee Engagement and Performance

By listening and seeking to understand the experiences of our employees, we strengthen our ability to raise the bar on our performance. We've heard from our employees that a sense of belonging is the biggest driver of engagement, which inspires and informs our listening tactics and reinforces our commitment to maintaining an inclusive workplace.

In 2022, we conducted two global pulse surveys to gauge employee sentiment and needs around our Business Transformation program. We measured understanding, personal buy-in, leadership commitment, leadership communication and culture. Survey results helped us tailor our communication and leadership messages to address gaps in understanding, gain alignment and better demonstrate our progress.

82%

of our employees understand the need for Business Transformation

In 2023, we are increasing opportunities for real-time feedback by expanding the frequency of employee surveys to once a quarter instead of every two years. Metrics included in the survey address employee engagement, manager effectiveness, performance enablement and our culture.

Business Transformation in Action: Learning and Development

In 2022, our Business Transformation work laid the foundation for a refreshed strategy for companywide learning and development in 2023 and beyond. Our new, centralized approach will focus on continuous employee development and compliance, along with a differentiated Leadership Development program with a specific focus on building leadership skills before employees ever lead their first team.

Our new Learning and Development operating model will be comprised of three sectors:

• Qualifications and Compliance Hub: Focused on efficient delivery for operational excellence, specifically in our field locations.

• Learning Strategy and Solutions Center of Excellence: Focused on agile solutions and enterprisewide services, including in-house instructional design expertise.

• Learning and Leadership Academy: Focused on specialized skill development, such as new hire, engineering, people leader and function-specific learning.

We’re excited to transform learning and development in a way that makes it an area of distinction for Phillips 66 and provides employees with a consistent learning experience throughout their careers.”

PATTI CELESTINE General Manager, Global Learning and Development

MOBILE APP UNITES A GLOBAL WORKFORCE

The company’s mobile app, MyRoute, brings together our workforce locally and globally across offices and field locations.

“My team is dispersed and operates in very remote areas of the country, and MyRoute provides a sense of connection for us,” said Brandon Anderson, Superintendent, Glacier, Bakken, Seminoe, Midstream.

It provides accessible, on-the-go information related to company announcements, new programs and initiatives and human-interest stories. Plus, it’s user-curated, so employees can share and interact with the content that is most meaningful to them.

Since its introduction in 2018, it has become a primary means of engagement, and more than 77% of the employee population has the app on their personal or company device.

MyRoute was a pivotal communication tool in 2022 during the CEO transition and throughout Business Transformation. The new CEO channel, PostMark, gives Mark Lashier a way to engage with employees at all levels and locations and allows people to get to know him personally and professionally. The Business Transformation channel has kept employees informed on projects, timelines and success stories during a time of change.

Other channels, like Be Engaged, present culturebuilding opportunities.

“Be Engaged is a place where people can be more than just an employee,” said Laurie Madden, Senior Advisor, Digital Communications, Corporate Communications. “It’s a place where we can really show our whole selves at our own comfort levels and share moments that are important to us.”

Humber Refinery NORTH LINCOLNSHIRE, U.K.

PostMark CEO channel on MyRoute HOUSTON, TX

LEADERSHIP INSIGHTS

Taking Charge of Your Career

Senior Vice President of Commercial Mark Hughes says proactively seeking new and challenging experiences helped him refine his career aspirations and prepared him to be an effective leader.

How has the employee experience at Phillips 66 allowed you to have such a diverse career path?

Our company encourages rotational and developmental assignments for employees who seek to gain experiences across the value chain. Through timely and open conversations with mentors and supervisors, I conveyed my career aspirations and determined the right next role on a challenging but rewarding journey thus far. Phillips 66’s continued investment in leadership development and business-specific training has given me the skills and knowledge I need to be successful in a variety of positions.

I went from a team leader of about 10 employees in Energy Research & Innovation to a team of 50 in the IT organization, 200 in Procurement, and well over 400 globally in our Commercial organization. I’ve developed my leadership capabilities from the team to the organizational level while experiencing and solving challenges across our businesses. My journey would not have been possible without hands-on sponsorship, mentoring and guidance from senior leaders.

What role allowed you to stretch yourself and grow the most?

In 2014, I took a role leading our IT business partner team for Commercial, Marketing, Midstream and Lubricants. I started as an engineer and spent time in Finance, but IT was entirely new. The learning curve was steep, the subject matter was daunting and the challenges were complex. It took me out of my comfort zone but proved to be one of the most rewarding and beneficial roles of my career. I gained an essential understanding of the many processes, systems and technology that ensure our key businesses operate reliably. I also expanded my network in a new direction, building important connections across the company and beyond.

What’s your advice for early-career employees to help them discover their career path?

It’s your career path, so own it! It starts with figuring out what type of work you find rewarding, exciting and fulfilling. Connect with your peers, supervisors and company leaders to hear about their experiences. Figure out where your passions lie by volunteering to take on a new project, participate in a new initiative or test a new process, system or tool. Engaging with others and trying new things helps you discover your career interests and ambitions. Our company is uniquely committed to employee development and offers many resources to help our people achieve their goals. Still, each of us must proactively leverage those resources and take ownership of our careers if we want to realize our aspirations.

Mark Hughes HOUSTON, TX

TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Innovation and Transformation

Billings Refinery BILLINGS, MT

Fulfilling an ambitious vision for the future

Optimizing Our Work, Creating Innovation

Phillips 66 is seizing the opportunity for growth in technology and new markets as the energy transition unfolds.

By rethinking how we work, we are creating a more agile and collaborative organization, redirecting resources to higher value areas, aligning on new goals and objectives, and empowering our people to think boldly while maintaining our commitment to business and operational excellence. This creates an environment ripe for innovation.

WEB-EXCLUSIVE VIDEO

Trying new things

Phillips 66 employees in every business unit contribute to strengthening our ability to meet the world’s growing energy demands while building a competitive, lower-carbon business platform. We launched the Business Transformation program, engaging thousands of employees across the company to find ways to be more efficient in providing energy now. We’re also investing in new energy solutions for tomorrow.

AT A GLANCE

Business Transformation

Business Transformation officially kicked off in March. Implementation began in July, and by the end of 2022, we already had these results:

3,000+ employee-generated ideas

500+ initiatives in place and delivering value or positioned to deliver value

700+ initiatives in execution

$500+ million run-rate reached by the end of 2022; $200 million is sustaining capital and $300 million is cost

$1 billion

run-rate expected to be reached by the end of 2023; $200 million is sustaining capital and $800 million is cost

FINDING NEW WAYS OF WORKING

Our ability to compete in the energy transition relies on finding better, more efficient ways of working to generate bottom-line savings. The foundation for our Business Transformation was set by our AdvantEdge66 program, which began in 2018 and progressed through 2022. It brought us to a higher level of digital maturity and helped us embrace the tools and behaviors to leverage digital capabilities and advance automation.

Our Digital Transformation

Digital Transformation enables us to elevate our safety performance, reduce emissions and optimize processes by using artificial intelligence, machine learning, advanced analytics and other digital technologies.

Our field locations are now using tablets and work-enhancing apps to improve productivity, increase access to data and enable better knowledge sharing.

Other improvements to safety and operational efficiencies include:

• Using drones to inspect elevated structures and equipment to shave hours off work time and enhance safety by keeping people from working at height. Phillips 66 now has more than 60 trained and qualified drone pilots across our refineries.

• Using wireless connectivity and sensors in our Refining business to improve safety, efficiency and productivity while enabling smarter operations and connected worker capabilities. Wireless vibration sensors allow near-real-time monitoring of rotating equipment, reducing manual data collection and alerting staff to anomalies so they can quickly fix any issues.

• Digitizing more than 18,000 operating procedures to allow operators to access and execute procedures using mobile devices and coordinate seamlessly with control room personnel. This wireless technology provides employees with information when and where they need it.

“Investing in technology means investing in our people because it improves how we work, and technology investments are the platform to further our Business Transformation.”

TANDRA PERKINS Senior Vice President, Chief Digital and Administrative Officer

Tandra Perkins

EMPLOYEE EXPERIENCE

OUR CULTURE INNOVATION AND TRANSFORMATION

TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Our Business Transformation Program

Technological advancement underpins our Business Transformation program, a comprehensive effort to empower our people to be bold and innovative, achieve lower costs, and create sustainable savings to position the company for long-term market competitiveness.

One of our OEIA principles is to seek different perspectives, and Business Transformation enables that by simplifying and standardizing major cross-business processes to change how we interact, share information, involve others and collaborate effectively. This drives agility, helps us avoid operating in silos and allows us to make faster decisions to capture opportunities.

Our employees are encouraged to think big and try new things. A leaner, more agile organization with fewer redundancies allows us to work efficiently and empowers people at all levels.

In 2022, we established our Transformation Management Office, led by Senior Vice President and Chief Transformation Officer David Erfert, and organized teams companywide to tackle transformation efforts. Several changes in our organizational structure include:

• Retooling our staff functions to consolidate, standardize and simplify work, ensuring it’s happening at the right level and utilizing automation whenever possible. Our goal is to decrease duplication and increase efficiency. Centers of Excellence in our Finance, Human Resources, Procurement, Information Technology and Communications groups will drive more cost-effective and consistent service delivery models.

• Redesigning our Value Chain Optimization organization and integrating our Refining and Commercial organizations to reduce duplication and enable a “one team” mindset focused on greater-good decision making.

• Establishing a Chemicals business to realize opportunities in the higher-growth chemical markets. This includes integrating specialty products into the Chemicals group because they share similar customers and work activities.

• Integrating DCP Midstream into our organization to serve our natural gas liquids strategy.

DAVID ERFERT Senior Vice President and Chief Transformation Officer

“It’s exciting to see our people enabling sustainable savings through new ways of working. I’m seeing people embracing the vision, making bold changes and succeeding.”

David Erfert

Managing Change

Because we redesigned and streamlined the organization as part of the Business Transformation process, our employee base was reduced from 14,000 to 13,000.

While change is necessary and often leads to exciting outcomes, change management is an important consideration. Our people leaders are the first resource for employees who have questions. We created a formal network of communications liaisons for each Business Transformation workstream. They were responsible for communicating changes to people and teams, sharing information on progress and supporting the change management process.

Additionally, after the initial changes to job scopes and staffing were made, we held daily meetings to help maintain business continuity and address any issues quickly, along with support to businesses and functions to enable a smooth rollout of changes. People leaders were given additional training on change management and transitioning for success. Our Leaders Group, which consists of our top leaders across the company, led the organizational design changes to gain a holistic perspective on how these plans will help the company achieve its strategy.

BRENDA BRINSON

General Manager, Organizational Design Workstream Lead

Change is rarely easy, but changing how we work will allow us to thrive in the future and become the Phillips 66 we aspire to be.

Business Transformation provides the golden opportunity to create a faster, more adaptive organization and continue to shape our culture.”

Global Town Hall at headquarters HOUSTON, TX

Business Transformation in Action: High-Impact Initiatives

Business Transformation spurred thousands of ideas from our employees, and they continue to come up with new ones every day. By looking at things in different ways, they’re finding opportunities to operate more efficiently, preserve resources and achieve excellence. Here are just a few examples of the high-impact initiatives to come out of Business Transformation:

Reducing Demurrage

Delays in the transport of products or in unloading them at a dock can result in demurrage charges, which increase costs.

In 2022, our Global Supply Chain and Logistics organization established a process to reduce delays and enhance data visibility. These changes have helped us improve processes to avoid the most frequent causes of delays and offset late charges when the cause is out of our control.

Investing Wisely

A collaboration between Commercial and Refining led to big savings.

Commercial discovered an opportunity to save on freight expenses at the Lake Charles Manufacturing Complex if an investment was made in a new loader and scale system. Installing these two new pieces of equipment would increase efficiency at the refinery, enable more production and avoid additional transportation service fees. When seeing the cost and time savings, Lake Charles sprang into action.

The reduced spending on freight costs has saved almost double the investment in the new equipment.

Saving Fuel

At our Bayway Refinery, a cross-functional effort involving Operations and Technical employees is saving money and resources with immediate, no-cost changes.

By reducing excess oxygen in our furnaces, we’re able to run them at high efficiency and decrease fuel usage. Refinery personnel have access to the performance data, so energy usage progress and performance gaps are quickly identified. Projects like this one lay the groundwork for future energy initiatives and make energy performance part of daily conversations and decision making.

Bayway Refinery LINDEN, NJ

ADVANCING OUR EMERGING ENERGY ORGANIZATION

Our Emerging Energy organization is focused on building a lower-carbon sustainable business platform by leveraging our existing assets and capabilities and advancing investments in new energy technologies. In 2022, ESG (Environmental, Social and Governance) and Sustainability moved from HSE to join Emerging Energy as part of our strategy to advance long-term sustainability efforts. Emerging Energy team members collaborate across business units and with experts in Energy Research & Innovation (ERI), concentrating on renewable fuels and other complementary energy technologies.

RENEWABLE FUELS

Renewable fuels like renewable diesel, sustainable aviation fuel (SAF) and renewable naphtha are an extension of our current business and allow us to use existing infrastructure in new ways to meet changing energy needs. Additionally, processing pyrolysis oil from waste plastics allows us to make feedstocks for new plastics.

Phillips 66 is also investing in additional energy technologies as strategic complements to our core businesses.

76® renewable diesel service station PLEASANT HILL, CA

BATTERIES

As a leading manufacturer of specialty coke, a precursor material to synthetic graphite used in batteries for electronics and electric vehicles (EVs), we are an important part of the U.S. and European battery value chain.

CARBON CAPTURE

Carbon capture is a critical part of meeting climate goals. It’s why we’re part of a consortium of Houston companies working to capture and store carbon dioxide.

HYDROGEN

Hydrogen is a low-emission fuel that will help decarbonize sectors that are hard to electrify, like heavy industry.

EV CHARGING

We’re aligning with leading technology companies to bring EV charging to U.S. and European consumers.

Zhanna Golodryga

ZHANNA GOLODRYGA Executive Vice President, Emerging Energy and Sustainability

“We’re using our expertise and assets to secure competitive advantages in emerging energies by investing in projects with the right returns, the right technologies, the right regulatory environments, and the right partners at the right time.”

EMPLOYEE EXPERIENCE

CULTURE INNOVATION AND TRANSFORMATION

TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Commercialization and Industry Collaboration for the

Greater Good

Collaborations with other companies and organizations, universities, and governments are creating opportunities for our people to explore and advance future energy technologies. Phillips 66 is involved in several projects that align with our Emerging Energy strategy.

SUPPORTING A U.S. BATTERY SUPPLY CHAIN

Phillips 66 is a leading global supplier of specialty coke, a precursor material in the lithium-ion batteries that power personal electronics and EVs. Early in 2022, we signed a technology development agreement with NOVONIX, a developer and supplier of materials for lithium-ion batteries, to advance the production and commercialization of next-generation anode materials. That agreement followed a strategic investment in the company, supporting the development of the U.S. battery supply chain.

ADVANCING CARBON CAPTURE

In the United Kingdom, our Humber Refinery is a leader in Humber Zero, a regional project to capture up to 8 million tons of carbon dioxide per year by 2030. This was one of just 20 projects shortlisted in 2022 by the U.K. government for carbon capture, usage and storage deployment.

Learn more about our efforts to achieve a lower-carbon future in the United Kingdom

FORGING A ROAD MAP FOR HYDROGEN

Our joint venture with H2 Energy Europe is working to develop 250 hydrogen fuel stations in Germany, Austria and Denmark by 2026. Sites are intended to be supplied with green hydrogen. Additionally, our Humber Refinery is part of the Gigastack project, which aims to fuel the refinery’s industrial equipment with renewable hydrogen.

GIVING A BOOST TO EVs

In June 2022, Phillips 66 and FreeWire Technologies announced plans to deploy its ultrafast, battery-integrated technology at select Phillips 66®, Conoco® and 76® branded sites across the United States. In November 2022, our JET® U.K. fuel stations launched JET CHARGE, ultra-rapid chargers for EV drivers.

DRIVING A CIRCULAR ECONOMY

In 2022, we received International Sustainability and Carbon Certification PLUS certification for our Sweeny Refinery in Texas to process pyrolysis oil made from hard-to-recycle waste plastics into circular ethane, circular propane, circular propylene and other sustainable feedstocks and petrochemical building blocks. Polymer producers, including Chevron Phillips Chemical Company LLC, Phillips 66’s 50/50 joint venture, will use the products as they advance a circular economy for plastics.

Coop Mineraloel hydrogen fuel truck HUNZENSCHWIL, SWITZERLAND

Taking a Leading Role in Renewables

As the General Manager of the San Francisco Refinery, Jolie Rhinehart is leading the Rodeo Renewed effort to convert the refinery from processing crude oil to processing waste oils, fats and greases and vegetable oils into fuel.

800 million

gallons per year of renewable transportation fuel production capacity upon Rodeo Renewed completion

You’ve been part of many groundbreaking projects at Phillips 66. What opportunities do you see coming out of Business Transformation?

It is a very exciting time at Phillips 66 as we expand our perspective on providing energy and enhancing our core business through emerging technologies. The opportunities are immense because we have the operating assets, technical competence and means to determine what improvements we need to make for our business. Our Phillips 66 team is perfectly suited to evaluate and implement these emerging and sustainable technologies and to upgrade our business model.

Can you tell us about an innovation that has dramatically changed the company or industry?

Seeing our 76® fuel brand innovate to sell renewable diesel at more than 600 stations across California was a true inspiration and a testament to what a team can accomplish. Phillips 66 and the 76® brand are now recognized as industry leaders in the production and marketing of lower-carbon-intensity transportation fuels.

What is it like to be leading the Rodeo Renewed effort?

I’m honored to be part of the San Francisco Refinery team executing the transformational Rodeo Renewed project. The most exciting part is elevating our business to be successful and secure well into the future. Our employees will know that their children and grandchildren can have secure careers working here. Our heritage facility of four sites stretched across several hundred miles no longer had a competitive advantage as a traditional oil refinery. The Rodeo Renewed project capitalizes on the strongest components of our assets. Consolidating our business into the Rodeo site and transforming to process fats, oils and greases both meets the needs for lower-carbon-intensity transportation fuels and secures our family-wage jobs. Our facility will produce the vital renewable energy people need, and it will improve the lives of our workers, community and region. It’s amazing to be part of a company committed to operating a business in California.

Jolie Rhinehart RODEO, CA

EMPLOYEE EXPERIENCE

OUR CULTURE INNOVATION AND TRANSFORMATION

TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Researching Solutions for the Future

Emerging Energy partners with our ERI team, which operates at the Phillips 66 Research Center in Bartlesville, Oklahoma. Inside the facility, teams of scientists, engineers and technicians work together to advance the cutting-edge science that is critical for enhancing company sustainability, developing future technologies and supporting existing operations. From the laboratory to pilot facilities, in-house research and development at Phillips 66 drives new ideas forward.

AT A GLANCE

Energy Research & Innovation

200 labs with technicians, Ph.D. scientists and engineers

30 countries represented (data as of 2021)

24 languages spoken

517

active patents in 21 countries worldwide

440 acres of land make up the Phillips 66 Research Center

Sustainable aviation fuel lab at Humber Refinery NORTH LINCOLNSHIRE, U.K.

Batteries laboratory at Phillips 66 Research Center BARTLESVILLE, OK

WEB-EXCLUSIVE

Ultrafast EV charging debuts at Phillips 66 flagship station

Innovation and Performance

Innovation keeps Phillips 66 competitive and secures a sustainable future. It drives solutions to reach our business and environmental targets, like our intent to reduce greenhouse gas (GHG) emissions intensity from our operations and energy products by 2030 and 2050, both from a 2019 baseline.

Learn more about our commitment to reducing GHG emissions in the Sustainability section of Phillips66.com

The company’s annual incentive program reflects the importance of these priorities. Our Human Resources and Compensation Committee has set the weighting of our environmental factor in the Variable Cash Incentive Program (VCIP) at 15%. We also include metrics for advancing lower-carbon investments, optimization and innovation and reducing manufacturing emissions intensity and setting GHG emissions reduction targets.

EV charger at Phillips 66 flagship site HOUSTON, TX

Focusing on physical, social, financial and emotional well-being

Investing in Our People

At Phillips 66, our benefits programs are aligned with our vision and strategy, and we make significant investments annually in Total Rewards to attract, retain and engage our people.

Benefits programs are focused on total well-being — physical, social, financial and emotional.

We benchmark our Total Rewards annually to ensure our programs are competitive with our peers and customize our offerings to appeal to our diverse, multigenerational workforce.

OUR TOTAL REWARDS PHILOSOPHY

We want our benefits to bring out the best in our people so they can deliver their best work. The key tenets of our philosophy are:

• Compensate all employees equitably regardless of race, gender or other personal characteristics.

• Pay for performance.

• Provide competitive offerings aligned with market practice.

• Be responsive to the priorities of our evolving workforce.

Compensation

$179,184

in total compensation and benefits for our median employee

COMPETITIVE Benchmarked against our industry and the broader market Reviewed annually

PERFORMANCE-BASED

Annual Variable Cash Incentive Program (VCIP) for eligible employees

Restricted Stock Unit (RSU) Program for eligible employees

EVOLVING POLICIES FOR AN EVOLVING WORKFORCE

EQUITABLE

Adverse impact analysis

Disparity reviews

Periodic pay equity reviews

Our employees gave us feedback that they needed more flexibility in their work schedules so they could better meet the demands of both work and home. We heard them, and we took action.

In 2022, we implemented workplace enhancements for our non-represented U.S. exempt employees, offering a choice of three work schedules in addition to the Flexible Work Model we already had in place, which allows for one day of remote work per week. We also modified our holiday policy to include Martin Luther King Jr. Day and gave employees two floating days so they can take time for the holidays that mean the most to them.

Comprehensive Benefits at a Glance

PHYSICAL WELL-BEING

1. Comprehensive medical, dental and vision coverage

2. Well-being incentive program

3. On-site wellness centers

4. Health coaching

5. Healthy sleep support through an app

SOCIAL WELL-BEING

1. Paid volunteer days for eligible employees

2. Matching gift and volunteer grant programs

3. Dependent scholarships

4. Backup child and adult care

5. Parenting support

94% employees enrolled in medical plans

$4.3 million paid out under well-being incentive and fitness reimbursement programs

FINANCIAL WELL-BEING

1. Robust savings plan match

2. Pension plan for all employees

88,000 volunteer hours

$7.4 million donated to organizations through our matching gift and volunteer grant programs

EMOTIONAL WELL-BEING

1. Resources for Living employee assistance program

2. Parental leave and adoption assistance

3. Generous time-off programs

4. Comprehensive behavioral health benefits

4. Health Savings Account (HSA)

5. Flexible personal day options

1.9 million vacation and 19/30 work schedule hours used

196 dependent scholarships awarded $216 million in success share and savings matches

$8.2 million contributions to HSA accounts

3,200+ employees utilized company-provided financial coaching resources

OUR CULTURE INNOVATION AND TRANSFORMATION

TOTAL REWARDS EMPLOYEE EXPERIENCE LABOR AND EMPLOYEE RELATIONS

Supporting Employees at Work and at Home

Supporting our employees’ total well-being is essential for a high-performing organization. Our benefits program is designed to:

• Provide attractive and competitive benefits that meet the needs of our workforce.

• Promote better outcomes through access to high-quality care.

• Encourage smart decision making and manage escalating costs while enhancing employees’ experiences.

In 2022, we rolled out plans for a new virtual physical therapy app and two new programs that use cognitive behavioral techniques to help people manage day-to-day anxiety and improve their sleep. We also announced new resources to help employees prepare for retirement, including quarterly retirement readiness webinars, the opportunity to work with a financial advisor and a retirement planning page on our intranet.

We adjust and enhance our Total Rewards program every year. In 2023, we’re introducing these new benefits:

• An expanded Total Well-Being Incentive program that includes more health screenings and new options for financial coaching.

• An updated U.S. Parental Leave Policy that allows eligible employees to take up to six weeks of paid time off anytime within a 12-month window for the birth of a child, legal adoption or placement for adoption. For birth mothers, Phillips 66 offers 10 weeks of paid time off to recover under the Short-Term Disability Plan. By combining that coverage with the parental leave enhancement, birth mothers can receive up to 16 weeks of paid leave.

Lake Charles Manufacturing Complex employee Elizabeth Eustis

ACHIEVING EXCELLENCE AND CELEBRATING SUCCESS

Our employees strive each day to maintain and enhance our culture of operating excellence and high performance. We reward excellence through a variety of financial and nonfinancial forms of recognition.

This includes promotions, annual bonus adjustments, restricted stock units and special recognition awards. From a nonfinancial perspective, we recognize our employees through development assignments, private and public acknowledgment and celebratory events.

WEB-EXCLUSIVE

GOLDEN SHIELD AWARDS

The Golden Shield Awards are the company’s highest honor. Each year, employees nominate teams and individuals through a peer-based system in categories built around our business strategies and innovation. The annual program celebrates outstanding employee performance that delivers superior results for the company while demonstrating our values and the principles of OEIA. The program culminates in companywide recognition and local-level celebrations to mark the winners’ achievements.

We set high expectations for ourselves and our teams every day, and our people deliver. It’s important that we recognize their efforts and show appreciation for extraordinary performance.”

MARK COWART Manager, Global Compensation

2022 Golden Shield Awards ceremony at headquarters HOUSTON, TX

We're recognized as a great place to work

Labor and Employee Relations

Doing the right thing, always

EMPLOYEE EXPERIENCE OUR CULTURE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

Working Together for the Greater Good

Our core values of safety, honor and commitment align us with unions and works councils to achieve a high-performing organization and operating excellence. We strive to maintain collaborative working relationships and promote an inclusive culture for both represented and non-represented employees across our company and within the industry.

WORKING WITH UNIONS

We respect the rights of our union-represented employees to bargain collectively under the National Labor Relations Act in the United States, and we honor country-specific laws and requirements for international locations. We are committed to bargaining in good faith toward agreements that are fair and industrycompetitive while enabling each business unit to compete in an increasingly challenging global market.

AT A GLANCE Represented Workforce

34% of U.S. workforce

~225 employees represented by works councils in Austria, Germany and the United Kingdom

or

3,900 union-represented U.S. employees in Refining, Midstream, Lubricants and Sentinel Transportation, LLC

We always lead with safety. We operate safely. We work safely. And we want everyone to go home safely at the end of their day. That’s why it’s essential that all of our employees — no matter if someone is union or nonunion — are well-trained, protected and supported day in and day out.”

MICAH HEILBRUN Manager, Labor and Employee Relations

PROTECTING HUMAN RIGHTS

It’s our responsibility to promote respect for human rights within our own company, across our value chain and in the communities where we live and work.

Our

Commitment to Indigenous Peoples

The American Indian Science and Engineering Society honored Phillips 66 as a top-50 workplace for Indigenous STEM professionals for our efforts to recruit and support Native Americans.

Phillips 66’s Native American Network and Women’s Network ERGs helped increase awareness of violence against Native American women and girls. The ERGs partnered with the Native Alliance Against Violence for a presentation and companywide webcast. The presentation talked about the Missing and Murdered Indigenous Women movement, which calls attention to the thousands of missing and murdered Indigenous women and girls in the United States.

We also have a long-standing relationship with members of the Lummi Nation, who are part of the Community Advisory Panel at our Ferndale Refinery in Washington state. For many years, we have participated in the Lummi Nation’s First Salmon Ceremony.

Our Commitment to

Inclusion

Workplace inclusion and diversity requires continuous effort, and third-party validation helps signify that companies are on the right track. Phillips 66 earned a perfect score on the Human Rights Campaign Foundation’s Corporate Equality Index. 2022 was the second year in a row Phillips 66 achieved a score of 100. The ratings are based on four pillars: nondiscrimination policies, equitable benefits for LGBTQ+ employees and their families, supporting an inclusive culture and corporate social responsibility.

Our Commitment to Fighting Human Trafficking

Phillips 66 believes energy companies can help fight against human trafficking. We work to educate the truck drivers who transport our products and people who work at the convenience stores that sell our fuel. Convenience stores serve half the U.S. population every day and are often a stop for traffickers. We work to make sure store owners know the signs of human trafficking and what to do if they suspect someone needs help. We also encourage them to post stickers from In Our Backyard’s Convenience Stores Against Trafficking program with resources for anyone being held against their will. We are also a platinum-level sponsor of Truckers Against Trafficking. Its mission is to “educate, equip, empower and mobilize members of the trucking and busing industries to combat human trafficking.”

Native American Network Pow Wow BARTLESVILLE, OK

EMPLOYEE EXPERIENCE OUR CULTURE INNOVATION AND TRANSFORMATION TOTAL REWARDS LABOR AND EMPLOYEE RELATIONS

MAINTAINING THE HIGHEST ETHICAL AND MORAL STANDARDS

We believe that being a great place to work means respecting everyone. Our employees experience this through our culture, which is guided by our Code of Business Ethics and Conduct. All employees, regardless of their position, participate in annual training, during which they must attest that they will comply with the code. Other key policies also address how we conduct our business with respect for all people and the environment, our accountability and responsibility to communities, as well as our commitments to ethical and trustworthy relationships. Find a list of our key policies and governing documents, which include our anti-harassment, nondiscrimination, business partner and supplier ethics and whistleblower policies, on our website.

Global Ethics Toll-Free Help Line 855-318-5390 | phillips66.ethicspoint.com

Ponca City Refinery PONCA CITY, OK

2022 EEO-1 DATA

1 TRR as defined by the Occupational Safety and Health Administration (OSHA). Includes employees and contractors.

2 AFPM refers to American Fuel & Petrochemical Manufacturers, U.S. refining benchmark. Some 2022 benchmarking data not available at time of publication.

3 Also known as Lost Time Incident Rate. Includes employees and contractors.

4 Includes employees and contractors. Calculated according to U.S. Bureau of Labor Statistics (BLS) methodology.

5 Tier 1 and Tier 2 Process Safety Events as defined by the American Petroleum Institute RP-754.

23-0011_2 2023 © Phillips 66 Company. All rights reserved.

THANK YOU!

To the employees of Phillips 66, thank you for providing the essential energy that fuels our communities and the world. Your commitment to excellence is inspiring.