UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.    )

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DEAR FELLOW STOCKHOLDERS:

On behalf of our Board of Directors, thank you for your investment in Fluor. Our Board appreciates that it is elected by you, our stockholders, to oversee the management of our Company for the long-term benefit of all stakeholders.

We are pleased to invite you to join us at our 2023 annual meeting of stockholders to be held on Wednesday, May 3, 2023 at 8:30 a.m., Central Daylight Time. This year’s meeting will again be held virtually at www.virtualshareholdermeeting.com/FLR2023. At this year’s meeting, we will vote on the election of nine directors and the ratification of Ernst & Young LLP as Fluor’s independent registered accounting firm. We will also hold non-binding advisory votes to approve the compensation of Fluor’s named executive officers and to approve the frequency of future advisory votes on executive compensation. Members of management will report on the state of the Company and respond to stockholder questions.

It is important that your shares be represented and voted at the annual meeting regardless of how many shares you own. Whether or not you plan to join the meeting, we encourage you to review our proxy materials and promptly cast your vote over the internet or by phone. Alternatively, if you receive a paper copy of the proxy materials by mail, you may vote by signing, dating and mailing the proxy card or voting instruction card in the envelope provided. Voting in any one of these ways will ensure that your shares are represented at the meeting.

Our Board remains committed to serving your interests and greatly appreciates your continued support of our Company. We look forward to you joining us virtually on May 3rd.

Sincerely,

David E. Constable
Chairman and Chief Executive Officer

March 15, 2023

“THANK YOU FOR YOUR INVESTMENT IN FLUOR . . . . OUR BOARD REMAINS
COMMITTED TO SERVING YOUR INTERESTS AND GREATLY APPRECIATES
YOUR CONTINUED SUPPORT OF OUR COMPANY.”

 

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

​	When	​	​	​	Wednesday, May 3, 2023 8:30 a.m. Central Daylight Time	​
​	Where	​	​	​	Online at: www.virtualshareholdermeeting.com/FLR2023	​
​	Record Date	​	​	​	Close of business on March 6, 2023	​

​	1	​	​	​	The election of the nine directors named in the proxy statement to serve until the 2024 annual meeting of stockholders.	​
​	2	​	​	​	An advisory vote to approve the Company’s executive compensation.	​
​	3	​	​	​	An advisory vote to approve the frequency of future advisory votes to approve the Company’s executive compensation.	​
​	4	​	​	​	The ratification of the appointment of Ernst & Young LLP as independent registered public accounting firm for 2023.	​
​	5	​	​	​	Such other matters as may be properly presented at the meeting.	​

All stockholders of record at the close of business on March 6, 2023 are entitled to receive notice of, and to vote at, the annual meeting of stockholders and any adjournment or postponement thereof. The annual meeting will be a virtual meeting, conducted exclusively online at www.virtualshareholdermeeting.com/FLR2023. Stockholders as of the record date may participate in the annual meeting online, vote or submit questions by visiting the meeting website and logging in with the control number on their proxy card, voting instruction form, Notice of Internet Availability of Proxy Materials (the “Notice”) or legal proxy. Instructions on how to participate in the annual meeting are described in the accompanying proxy statement.

Please cast your vote by either voting your shares over the internet or by phone, as promptly as possible. Alternatively, if you have received paper copies of your proxy materials, you may complete, sign, date and promptly return the proxy card or voting instruction card in the postage-prepaid return envelope provided, or you may follow the instructions set forth on the proxy card or voting instruction card to authorize the voting of your shares over the internet or by phone. Your prompt response is necessary to ensure that your shares are represented. If you wish to receive paper copies of your proxy materials, including the proxy card or voting instruction card, follow the instructions in the Notice.

By Order of the Board of Directors,

John R. Reynolds
Executive Vice President, Chief Legal Officer and Secretary

March 15, 2023, Irving, Texas

 

FLUOR CORPORATION

TABLE OF CONTENTS

PROXY SUMMARY

PROXY SUMMARY

This is a summary only and does not contain all of the information that you should consider in connection with this proxy statement. Please read the entire proxy statement carefully before voting.

GOVERNANCE HIGHLIGHTS

Stockholders are being asked to vote on the following matters:

 

2023 PROXY STATEMENT   1

FLUOR CORPORATION

HOW TO VOTE

You are entitled to vote at the 2023 annual meeting of stockholders if you were a stockholder of record at the close of business on March 6, 2023, the record date for the meeting.

Website References. Website references throughout this proxy statement are provided for convenience only and the content on the referenced websites is not incorporated by reference in, and does not form a part of, this proxy statement.

Forward-Looking Information. This document contains forward-looking statements relating to the manner in which we intend to conduct our activities based on our current plans and expectations. These statements are not promises of our future conduct or policy and are subject to a variety of uncertainties and other factors, many of which are beyond our control. Therefore, our actual activities, including the development, implementation or continuation of any program, policy or initiative discussed in this proxy statement and the outcomes of such activities, may differ materially. The statements of intention in this proxy statement speak only as of the date of this proxy statement, and we do not undertake to publicly update any statements in this proxy statement. Read our 2022 Annual Report on Form 10-K, which includes a list of factors that could cause actual operational and financial results to differ from those expected. Forward-looking and other statements herein regarding our environmental and other sustainability plans and goals are not an indication that these statements are necessarily material to investors or required to be disclosed in our filings with the SEC. In addition, historical, current, and forward-looking social, environmental and sustainability-related statements may be based on standards that are still developing and our internal controls and processes continue to evolve.

 

2   2023 PROXY STATEMENT

PROPOSAL 1 — ELECTION OF DIRECTORS

 
PROXY STATEMENT

MARCH 15, 2023​

This proxy statement is furnished in connection with the solicitation by the Board of Directors (the “Board”) of Fluor Corporation (the “Company” or “Fluor”) of your proxy for use at the annual meeting of stockholders to be held online at www.virtualshareholdermeeting.com/FLR2023 on Wednesday, May 3, 2023, at 8:30 a.m. Central Daylight Time, or at any adjournment or postponement thereof. This proxy statement is first being mailed or made available to stockholders on March 15, 2023.

The current mailing address of the principal executive offices of Fluor Corporation is 6700 Las Colinas Boulevard, Irving, Texas 75039. Please direct any communications to this mailing address.

PROPOSAL 1 — ELECTION OF DIRECTORS

Each of the Company’s nominees are current directors, who were elected by stockholders at the 2022 annual meeting and whose terms will expire at the 2023 annual meeting. Each of Alan M. Bennett, Rosemary T. Berkery, David E. Constable, H. Paulett Eberhart, James T. Hackett, Thomas C. Leppert, Teri P. McClure, Armando J. Olivera and Matthew K. Rose has been nominated for election at the annual meeting to serve a one-year term expiring at the annual meeting in 2024 and until his or her respective successor is elected and qualified.

Each of the nominees listed above has agreed to serve as a director of the Company if elected. The Company knows of no reason why the nominees would not be available for election or, if elected, would not be able to serve. If any of the nominees decline or are unable to serve as a nominee at the time of the annual meeting, the persons named as proxies may vote either (1) for a substitute nominee designated by the Board to fill the vacancy or (2) just for the remaining nominees, leaving a vacancy.

Under the standard applicable to the Company’s director elections, a director must receive the affirmative vote of a majority of the votes cast; except that directors shall be elected by a plurality of the votes cast if the number of director nominees exceeds the number of directors to be elected (a situation we do not anticipate). A majority of the votes cast means that the number of shares voted “for” a director nominee must exceed the number of shares voted “against” that director nominee. If an incumbent director is not re-elected, the Governance Committee will consider his or her contingent resignation (given prior to the meeting) and make a recommendation to the Board on whether to accept or reject the resignation. The Board will then publicly announce its decision regarding whether to accept the resignation and, if not, the reasons why.

DIRECTOR NOMINEES

As discussed further below under “Corporate Governance — Consideration of Director Nominees,” the Governance Committee is responsible for reviewing with the Board, on an annual basis (and as needed), the composition of the Board to assess whether the skills, experience and characteristics established by the Board are currently represented on the Board as a whole and in individual Board members, and to assess the criteria that may be needed in light of the Company’s anticipated future needs. Our directors have experience with businesses that operate in industries which we serve, such as oil and gas and infrastructure, and collectively have additional skills that are important to overseeing our business, such as knowledge of construction services, financial matters, risk oversight and compliance, and familiarity with non-U.S. markets. The following pages highlight the specific experience, qualifications, attributes and skills that our individual directors possess which have led the Governance Committee to conclude that each should continue to serve on the Board, and therefore may not list all of the skills and experience that each director possesses.

 

2023 PROXY STATEMENT   3

FLUOR CORPORATION

DIRECTOR SKILLS MATRIX

 

4   2023 PROXY STATEMENT

PROPOSAL 1 — ELECTION OF DIRECTORS

DIRECTOR BIOGRAPHIES

The following biographical information is furnished with respect to each of the nominees for election at the annual meeting.

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Lead Independent Director

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​	AGE	​	​	​	72​	​
​	DIRECTOR SINCE	​	​	​	2011​	​
​	BOARD COMMITTEES	​	​	​	Audit (Chair), Executive and Organization and Compensation	​
​	INDEPENDENT	​	​	​	Yes	​

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POSITION AND BUSINESS EXPERIENCE

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

​

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OTHER PUBLIC COMPANY BOARD SERVICE

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​	AGE	​	​	​	69	​
​	DIRECTOR SINCE	​	​	​	2010	​
​	BOARD COMMITTEES	​	​	​	Governance (Chair), Audit and Executive	​
​	INDEPENDENT	​	​	​	Yes	​

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POSITION AND BUSINESS EXPERIENCE

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

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OTHER PUBLIC COMPANY BOARD SERVICE

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2023 PROXY STATEMENT   5

FLUOR CORPORATION

​	AGE	​	​	​	61	​
​	DIRECTOR SINCE	​	​	​	2019	​
​	BOARD COMMITTEES	​	​	​	Executive (Chair)	​
​	INDEPENDENT	​	​	​	No	​

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POSITION AND BUSINESS EXPERIENCE

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

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OTHER PUBLIC COMPANY BOARD SERVICE

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​	AGE	​	​	​	69​	​
​	DIRECTOR SINCE	​	​	​	2020 (with prior service from 2010 to 2011)​	​
​	BOARD COMMITTEES	​	​	​	Commercial Strategies and Operational Risk and Organization and Compensation	​
​	INDEPENDENT	​	​	​	Yes	​

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POSITION AND BUSINESS EXPERIENCE

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

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OTHER PUBLIC COMPANY BOARD SERVICE

​

 

6   2023 PROXY STATEMENT

PROPOSAL 1 — ELECTION OF DIRECTORS

​	AGE	​	​	​	69​	​
​	DIRECTOR SINCE	​	​	​	2016 (with previous service from March 2001 to April 2015)​	​
​	BOARD COMMITTEES	​	​	​	Organization and Compensation (Chair), Commercial Strategies and Operational Risk and Executive	​
​	INDEPENDENT	​	​	​	Yes	​

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POSITION AND BUSINESS EXPERIENCE

​

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

​

​

OTHER PUBLIC COMPANY BOARD SERVICE

​

 

​	AGE	​	​	​	68​	​
​	DIRECTOR SINCE	​	​	​	2019​	​
​	BOARD COMMITTEES	​	​	​	Commercial Strategies and Operational Risk and Governance	​
​	INDEPENDENT	​	​	​	Yes	​

​

POSITION AND BUSINESS EXPERIENCE

​

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

​

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OTHER PUBLIC COMPANY BOARD SERVICE

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2023 PROXY STATEMENT   7

FLUOR CORPORATION

​	AGE	​	​	​	59​	​
​	DIRECTOR SINCE	​	​	​	2020​	​
​	BOARD COMMITTEES	​	​	​	Audit and Governance	​
​	INDEPENDENT	​	​	​	Yes	​

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POSITION AND BUSINESS EXPERIENCE

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

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OTHER PUBLIC COMPANY BOARD SERVICE

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​	AGE	​	​	​	73​	​
​	DIRECTOR SINCE	​	​	​	2012​	​
​	BOARD COMMITTEES	​	​	​	Commercial Strategies and Operational Risk (Chair), Executive and Governance	​
​	INDEPENDENT	​	​	​	Yes	​

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POSITION AND BUSINESS EXPERIENCE

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

​

​

OTHER PUBLIC COMPANY BOARD SERVICE

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8   2023 PROXY STATEMENT

PROPOSAL 1 — ELECTION OF DIRECTORS

​	AGE	​	​	​	63​	​
​	DIRECTOR SINCE	​	​	​	2014​	​
​	BOARD COMMITTEES	​	​	​	Audit and Organization and Compensation	​
​	INDEPENDENT	​	​	​	Yes	​

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POSITION AND BUSINESS EXPERIENCE

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KEY ATTRIBUTES, EXPERIENCE AND SKILLS

​

​

OTHER PUBLIC COMPANY BOARD SERVICE

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BOARD RECOMMENDATION ✓

THE BOARD RECOMMENDS A VOTE FOR THE ELECTION OF ALL NINE DIRECTOR NOMINEES.

 

2023 PROXY STATEMENT   9

FLUOR CORPORATION

CORPORATE GOVERNANCE

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CORPORATE GOVERNANCE HIGHLIGHTS

We believe that good corporate governance practices promote the principles of fairness, transparency, accountability and responsibility and will provide long-term benefit to our stockholders. During the past year, we continued our annual practice of reviewing our corporate governance policies and practices, comparing them to those suggested by various commentators on corporate governance and the practices of other public companies and engaging with our stockholders on corporate governance issues.

The following highlights some of our core governance values:

Each year, our Board reviews all committee charters and in our most recent review the Board updated each of the charters for:

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the Audit Committee;

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■

the Executive Committee;

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■

the Governance Committee; and

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■

the Organization and Compensation Committee.

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In addition, in November 2022 the Board reviewed and updated the Company’s Corporate Governance Guidelines. You can access our current committee charters, Corporate Governance Guidelines, Code of Business Conduct and Ethics for Members of the Board of Directors, as well as other information regarding our corporate governance practices, on our website at www.fluor.com under “Sustainability”  —  ”Governance.” Our Code of Business Conduct and Ethics for Fluor employees can be found on our website at www.fluor.com under “Sustainability”  —  ”Ethics and Compliance.”

 

10   2023 PROXY STATEMENT

CORPORATE GOVERNANCE

STOCKHOLDER ENGAGEMENT

Fluor has a long tradition of engaging with its stockholders and being responsive to their perspectives. In addition to our regularly hosted investor days, we meet with stockholders on corporate governance and other topics of interest to them. Prior to adopting corporate governance initiatives, we consider the policies of our stockholders and solicit their perspectives on potential courses of action. Fluor and our Board have reached out to investors on a number of topics over the last several years, including governance, sustainability and compensation. Since our last annual meeting, we reached out to our top stockholders and had discussions on a number of topics, including our environmental and sustainability initiatives, diversity, equity and inclusion (“DE&I”) priorities, corporate governance and executive compensation.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE MATTERS

At Fluor, fostering a high-performance culture with purpose is a strategic priority for value creation. In addition to supporting one of our core key values, excellence, our high-performance culture with purpose embraces a focus on environmental, social and governance (“ESG”) matters, including sustainability efforts, promoting social progress, and DE&I.

Our sustainability mission envisions meeting the needs of our clients while conducting business in a socially, economically and environmentally responsible manner to the benefit of current and future generations, thereby creating value for all stakeholders. Fluor helps clients safeguard the environment, conserve energy, protect lives and strengthen economies and social structures of communities.

To lead and coordinate our sustainability policies, strategies and programs, we have established a Sustainability Committee, led by a Sustainability Group Chair with full-time responsibility for sustainability matters. The Sustainability Committee includes representatives of each of our business segments, as well as a cross-functional team of subject matter experts from communications, health, safety and environmental, investor relations, human resources and legal.

As a key priority, we set a goal to achieve net zero for Scopes 1 and 2 absolute greenhouse gas (“GHG”) emissions by the end of 2023. By achieving net zero, we seek to demonstrate to all of our stakeholders the importance of managing our GHG emissions. Each quarter we publish a report on www.fluor.com detailing our progress to net zero to be transparent with all of our stakeholders.

We are committed to advancing DE&I. We believe that every voice matters, and we value DE&I at every level of our organization. We encourage diversity of cultures and perspectives as we build inclusive, high-performance teams. We aim to listen actively, respect one another and foster an environment of inclusivity and a sense of belonging. We engage and partner with stakeholders who represent and support gender, generation, sexual orientation, mental and physical ability, race and ethnic diversity. We encourage knowledge sharing among our employees and stakeholders.

We are focused on delivering four key impact pillars to advance DE&I:

■

Champion an inclusive culture;

​

■

Recruit, develop and retain talent;

​

■

Enhance employee experience; and

​

■

Improve social progress and impact.

​

We work with a variety of outreach, community and education organizations, including a range of universities. In 2021, we added three historically Black colleges and universities to our Global University Sponsorship Program and we continue to grow our relationships across a range of diverse colleges.

We are committed to strengthening our talent pipeline by expanding our diversity lens in our recruitment and selection processes. We post our job openings internally and externally to reach a broad, diverse pool of candidates from all backgrounds. We have implemented a balanced slate candidate selection practice, which supports the inclusive selection of candidates based on capability, skills and qualifications for positions across our offices and business lines.

We have established five regional inclusion councils to drive region-specific diversity and inclusion actions. In addition, we currently have five employee resource groups (“ERGs”): Black Employee Alliance, Emerging Leaders Group, Graduates Advancing to Professionalism, Growing Representation & Opportunity for Women and PRIDE for our LGBTQ communities and allies. Active ERGs are a critical component of

 

2023 PROXY STATEMENT   11

FLUOR CORPORATION

strengthening our culture of inclusion by providing representation on regional inclusion councils, encouraging employee engagement, attracting and retaining talent, hosting intersectional events and offering allyship opportunities and a sense of community for all employees.

The Board is highly engaged in assessing sustainability and ESG matters and regularly receives updates on our performance, initiatives and challenges. Each of our Board committees has responsibilities overseeing aspects of ESG as detailed in their charters. In particular, the Governance Committee and the Organization and Compensation Committee play key roles in ESG oversight:

■

The Governance Committee regularly receives reports from management regarding ESG efforts and reviews and discusses public reporting on these topics, as well as reviews and discusses ESG strategy, initiatives and policies with management. The Governance Committee reviews the Company’s Political Activities Policy, reports regarding political contributions, lobbying activities and participation in trade associations, and makes recommendations regarding policies and procedures relating to charitable, education and political contributions. The Governance Committee also oversees Board composition, qualifications and diversity.

​

■

The Organization and Compensation Committee plays a key role in human capital management and DE&I, overseeing our strategic employment and workplace policies, practices and outcomes, including those related to equal opportunity, nondiscrimination, diversity in the workplace and environmental, health and safety policies. The Organization and Compensation Committee also reviews and monitors the Company’s top level organizational structure and senior management succession planning.

​

You can read more about our priority to develop a diverse workforce, our achievements in health, safety and environmental matters, our commitment to integrity and ethical business conduct and our proactive approach to community involvement and other sustainability efforts by reading our 2022 Integrated Report and visiting the “Sustainability” section of www.fluor.com. We report our sustainability data using the Global Reporting Initiative standards, Sustainability Accounting Standards Board standards and the World Economic Forum’s Stakeholder Capitalism Metrics.

BOARD INDEPENDENCE

In accordance with New York Stock Exchange (“NYSE”) listing standards and our Corporate Governance Guidelines, our Board determines annually which directors are independent and, through the Governance Committee, oversees the independence of directors throughout the year. In addition to meeting the minimum NYSE standards of independence, a director qualifies as “independent” only if the Board affirmatively determines that the director has no material relationship with the Company (either directly, or as a partner, stockholder or officer of an organization that has a relationship with the Company). A relationship is “material” if, in the judgment of the Board, the relationship would interfere with the director’s independent judgment.

Our Board has adopted director independence standards for assessing the independence of our directors. These criteria include restrictions on the nature and extent of any affiliations the directors and their immediate family members may have with us, our independent accountants, organizations with which we do business, other companies where our executive officers serve as compensation committee members and non-profit entities with which we have a relationship. Our independence standards are included in our Corporate Governance Guidelines, which are available at www.fluor.com under the “Sustainability”  —  ”Governance” section.

The Board, as recommended by the Governance Committee, has determined that each of the Company’s director nominees (other than Mr. Constable) is independent of the Company and its management under NYSE listing standards and the standards set forth in our Corporate Governance Guidelines. The Board also determined that each of the members of the Audit, Commercial Strategies and Operational Risk, Governance and Organization and Compensation Committees has no material relationship with Fluor and is independent within the meaning of the NYSE standards and our director independence standards for such committee.

Mr. Constable is not independent because of his employment as Chairman and CEO of the Company. Mr. Alan L. Boeckmann, who served on the Board during part of 2022, was not independent because of his employment as Executive Chairman of the Company at that time.

Finally, the Board reviewed charitable contributions made to non-profit organizations for which Board members (or their respective spouses) serve as an employee or on the board of directors. Specifically, the Board considered that certain directors and/or their family members (Ms. Berkery, Mr. Hackett, Mr. Leppert, Mr. Olivera and Mr. Rose) are affiliated with non-profit organizations that received contributions from the Company in 2022, 2021 or 2020. No organization received contributions in a single year in excess of  $100,000; which falls below the thresholds of the Company’s independence standards.

 

12   2023 PROXY STATEMENT

CORPORATE GOVERNANCE

RISK MANAGEMENT OVERSIGHT

Cybersecurity and other IT risks are important areas of focus for the Board, which views managing these risks as essential. As part of its oversight function, the Board devotes significant attention to these matters.

Our Board receives quarterly reports from management that address a broad range of cybersecurity and IT topics, including trends, regulatory developments, data security policies and practices, cybersecurity incidents, current and projected threat assessments and ongoing efforts to prevent, detect and respond to critical threats. In addition, the Audit Committee annually reviews and discusses with management risk issues associated with cybersecurity and IT and policies and controls to mitigate those risks, and periodically meets with our Chief Information Officer to review and discuss cybersecurity risk management and related issues. To help manage our cybersecurity risk, all employees participate in a number of information security training programs, our cyber policies and programs are externally certified and we hold cybersecurity risk insurance.

 

2023 PROXY STATEMENT   13

FLUOR CORPORATION

BOARD LEADERSHIP

The Chair of the Board is elected by the Board on an annual basis based on the recommendation of the Governance Committee. The Governance Committee annually reviews the leadership structure of the Board and recommends changes to the Board as appropriate. As set forth in our Bylaws and the Corporate Governance Guidelines, the Board is empowered to choose any one of its members as Chair of the Board. The Board welcomes and takes under consideration any input received from our shareholders regarding the Board’s leadership structure and informs shareholders of any change in the Board’s leadership structure through press releases or through amendments to the Corporate Governance Guidelines. In 2022, the Board named Mr. Constable as Chairman, having determined that Mr. Constable, as the individual with primary responsibility for managing the Company’s day-to-day operations, is best positioned to chair regular Board meetings, lead and facilitate discussions of key business and strategic issues, provide input on the agenda for each Board meeting, and perform such other duties as the Board may request from time to time.

To provide for independent leadership, the Board has also established a Lead Independent Director position, as it believes that the role of Lead Independent Director promotes effective governance when the Company has a non-independent Chairman. The Lead Independent Director serves for a term of three years (subject to annual reelection to the Board) and is elected by the independent directors. The duties are closely aligned with the role of an independent chair. In particular, the Lead Independent Director’s responsibilities are to:

■

preside over and set the agenda for all executive sessions of the independent directors of the Board;

​

■

approve agendas and schedules for meetings of the Board and information sent to the Board;

​

■

chair Board meetings in the Chairman’s absence;

​

■

act as a liaison between the independent directors and Chairman;

​

■

provide guidance on the director orientation process for new Board members;

​

■

consult and communicate with stockholders, as appropriate;

​

■

monitor communications to the Board from stockholders and other interested parties; and

​

■

call executive sessions of the independent directors, as needed.

​

In 2023, the independent members of the Board designated Mr. Alan M. Bennett to serve as Lead Independent Director for a three-year term that will expire in February 2026.

The Board believes that its current leadership structure provides independent Board leadership and engagement. By serving as both CEO and Chairman of the Board, Mr. Constable is able to speak on behalf of the Company on matters relating to the Company’s business, while the Lead Independent Director can speak on behalf of the Board regarding governance and oversight matters. In addition, each of the Board’s committees other than the Executive Committee is composed entirely of independent directors. Consequently, independent directors directly oversee critical matters such as the compensation policy for executive officers, succession planning, our methods of risk assessment and risk mitigation strategies, our policies and practices related to corporate governance, the director nominations process, our corporate finance strategies and initiatives, and the integrity of our financial statements and internal controls.

BOARD MEETINGS AND COMMITTEES

During 2022, the Board held six meetings. Each of the current directors attended all such meetings and of the Board committees on which he or she served and which were held during the period that each director served. As described earlier, the Lead Independent Director presides over all executive sessions of the independent directors. Executive sessions of independent directors take place at each regular Board meeting in accordance with our Corporate Governance Guidelines. During 2022, four executive sessions of the independent directors were held.

The Board has a policy that directors attend the annual meeting of stockholders each year. All directors then serving attended the virtual 2022 annual meeting of stockholders.

Our Board has five standing committees:

■

Audit;

​

■

Commercial Strategies and Operational Risk;

​

■

Executive;

​

■

Governance; and

​

■

Organization and Compensation.

​

 

14   2023 PROXY STATEMENT

CORPORATE GOVERNANCE

Each committee has a charter that has been approved by the Board. With the exception of the Executive Committee, each committee must review the appropriateness of its charter and perform a self-evaluation at least annually. Any recommended changes to the charters require approval by the Board.

The table below shows the current membership of each committee, and the independence status of each director.

* Lead Independent Director  ** Chairman  C Chair  • Member

AUDIT COMMITTEE

 

2023 PROXY STATEMENT   15

FLUOR CORPORATION

COMMERCIAL STRATEGIES AND OPERATIONAL RISK COMMITTEE

EXECUTIVE COMMITTEE

 

16   2023 PROXY STATEMENT

CORPORATE GOVERNANCE

GOVERNANCE COMMITTEE

 

2023 PROXY STATEMENT   17

FLUOR CORPORATION

ORGANIZATION AND COMPENSATION COMMITTEE

 

18   2023 PROXY STATEMENT

CORPORATE GOVERNANCE

BOARD AND COMMITTEE EVALUATIONS

In order to monitor and improve their effectiveness, and to solicit and act upon feedback received, the Board and its committees engage in an annual formal self-evaluation process. As part of the self-evaluation process, directors consider various topics related to Board composition, structure, effectiveness and responsibilities. While the Board and each of its committees conduct the self-evaluations annually, the Board considers its performance and that of its committees continuously throughout the year and shares feedback with management. The self-evaluation process that the Board has historically used is conducted as follows:

CONSIDERATION OF DIRECTOR NOMINEES

The Board believes that our stockholders benefit when the Board includes individuals with a diverse range of backgrounds and experience to give the Board both depth and breadth in the mix of skills represented. Over 40% of our director nominees are diverse individuals, including three women and two racially or ethnically diverse directors.

As provided in our Corporate Governance Guidelines, while all directors should possess business acumen and must exercise sound judgment in their oversight of our operations, the Board endeavors to include in its overall composition an array of appropriate skills and experience in its overall composition. Accordingly, the Board and Governance Committee consider the qualifications of directors and director nominees both individually and in the broader context of the Board’s overall composition and the Company’s current and anticipated future needs. As part of the search process for each new director, the Governance Committee includes women and minorities in the pool of candidates (and instructs any search firm the Committee engages to do the same).

 

2023 PROXY STATEMENT   19

FLUOR CORPORATION

The Board and Governance Committee also understand the importance of board refreshment and aim to strike a balance between the knowledge that comes from longer-term service on the board with the new experience, ideas and energy that can come from adding directors to the Board. To that end, our Corporate Governance Guidelines provide that non-management directors may not stand for re-election after the end of the year in which they reach the age of 75. In addition, the Board and Governance Committee view the consistent focus on Board membership criteria, Board composition and size, as well as the anticipation of vacancies, to be integral parts of board refreshment.

Our Corporate Governance Guidelines contain Board membership criteria that apply to current directors and nominees. The Governance Committee is responsible for reviewing with the Board on an annual basis (and as needed), and recommending to the Board, the skills, experience, characteristics and other criteria for identifying and evaluating Board members. The Governance Committee evaluates the composition of the Board annually (and as needed) to assess whether the criteria established by the Board are currently represented on the Board as a whole, and in individual directors, and to assess the criteria that may be appropriate in light of the Company’s anticipated future needs. This assessment takes into consideration issues of diversity of thought and background (including but not limited to gender, race, ethnicity, national background, geography and age), experience, qualifications, attributes and skills. Criteria that our Board looks for in a candidate include, among other things, an individual’s business experience and skills, judgment, independence, integrity, reputation and international background, the individual’s understanding of such areas as finance, marketing, IT, regulation and public policy, whether the individual has the ability to commit sufficient time and attention to the activities of the Board, the fit of the individual’s skills and personality with those of other directors in building a Board that is effective, collegial and responsive to the needs of the Company, and the absence of any potential conflicts with the Company’s interests. The Board assesses its effectiveness in achieving these goals in the course of assessing director candidates, which is an ongoing process, and in the context of its Board and committee evaluations.

The Governance Committee utilizes a variety of methods for identifying and evaluating nominees for director. The Governance Committee regularly assesses the appropriate size of the Board, and whether any vacancies on the Board are expected due to retirement or otherwise. In the event that vacancies are anticipated or otherwise arise, or skills or experience needs are identified, the Governance Committee considers various potential candidates for director. Candidates may come to the attention of the Governance Committee through various means, including current Board members, professional search firms, stockholders or other persons. Under our Corporate Governance Guidelines, as part of the search process for each new director, the Governance Committee must include women and minorities in the pool of candidates. The Governance Committee reviews a variety of information about candidates, including materials provided by professional search firms, if applicable, or other parties suggesting the candidate. In evaluating candidates, the Governance Committee seeks to achieve a balance of knowledge, experience and capability on the Board.

The Governance Committee considers properly submitted stockholder recommendations for candidates for Board membership. If a stockholder properly recommends an individual to the Governance Committee to serve as a director, all recommendations are aggregated and considered by the Governance Committee at a meeting prior to the issuance of the proxy statement. Any materials provided in connection with the recommendation of a director candidate are sent to the Governance Committee, which assesses candidates in light of the membership criteria set forth under “— Director Qualifications” above and the Board’s existing composition. Any stockholder wishing to recommend a candidate for consideration by the Governance Committee should submit a recommendation in writing demonstrating their share ownership and indicating the candidate’s qualifications and other relevant biographical information and provide confirmation of the candidate’s consent to serve as director. This information should be addressed to the Secretary, Fluor Corporation, 6700 Las Colinas Boulevard, Irving, Texas 75039. Stockholders also have the ability to nominate directors for election in accordance with the Bylaws. See “2024 Annual Meeting of Stockholders  —  Advance Notice Procedures” and “— Proxy Access Procedures,” and Sections 2.04 and 2.10 of our Bylaws, which are available at www.fluor.com under “Sustainability”  —  ”Governance.”

RELATED PERSON TRANSACTIONS

The Company has adopted a written policy for the approval of transactions to which the Company is a party and in which the aggregate amount involved in the transaction will or may be expected to exceed $100,000 in any calendar year if any director, director nominee, executive officer, greater-than-5% beneficial owner or their respective immediate family members have or will have a direct or indirect material interest (other than solely as a result of being a director or a less than 10% beneficial owner of another entity).

 

20   2023 PROXY STATEMENT

CORPORATE GOVERNANCE

The policy provides that the Governance Committee reviews certain transactions and determines whether to approve those transactions. In doing so, the committee takes into account, among other factors it deems appropriate, whether the transaction is on terms that are no less favorable to the Company than terms generally available in a transaction with an unaffiliated third party under the same or similar circumstances and the extent of the related person’s interest in the transaction. The committee will not approve any transaction if it determines the transaction to be inconsistent with the interests of the Company and its stockholders. In addition, the Board has delegated authority to the chair of the Governance Committee to approve transactions where the aggregate amount involved is expected to be less than $1 million. A summary of any new transactions pre-approved by the chair is provided to the full Governance Committee for its review in connection with each regularly scheduled Governance Committee meeting.

The Governance Committee has considered and adopted standing pre-approvals under the policy for limited transactions with related persons. Pre-approved transactions include, but are not limited to:

■

employment of immediate family members of directors, director nominees, executive officers and greater-than-5% beneficial owners in non-executive positions with the Company;

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■

business transactions with other companies at which a related person’s only relationship is as an employee (other than an executive officer) if the amount of business falls below the thresholds in NYSE listing standards and the Company’s director independence standards; and

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■

contributions to non-profit organizations at which a related person’s only relationship is as an employee (other than an executive officer) or director if the aggregate amount involved does not exceed the lesser of  $1 million or 2% of the organization’s consolidated gross annual revenue.

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Alan L. Boeckmann, the former Executive Chairman of our Board and the Company’s former CEO, receives distributions of deferred compensation and payments of supplemental benefits under arrangements that were previously disclosed and were approved by the Organization and Compensation Committee and the Board’s independent directors at the time he served as CEO and for which he chose to receive annuity payments.

CERTAIN LEGAL PROCEEDINGS

Since September 2018, eleven separate purported stockholders’ derivative actions were filed against various current and former members of the Board, including our nominees, other than Ms. Eberhart and Ms. McClure, as well as certain of Fluor’s current and former executives. The Company is named as a nominal defendant in the actions. The complaints generally allege federal securities law violations and breaches of the individuals’ fiduciary duties, including for purported oversight failures, with regard to statements that were made concerning the company’s internal and disclosure controls, risk management, revenue recognition and gas-fired power contracts, which statements the plaintiffs assert were materially misleading. While no assurance can be given as to their ultimate outcomes, the Company does not believe it is probable that it will incur a material loss in any of these actions.

COMMUNICATIONS WITH THE BOARD

Individuals may communicate with the Board and individual directors by writing directly to the Board c/o the Secretary, Fluor Corporation, 6700 Las Colinas Boulevard, Irving, Texas 75039. Stockholders and other parties interested in communicating directly with the Lead Independent Director or with the independent directors as a group may do so by writing directly to the Lead Independent Director c/o the Secretary at the above address. The Lead Independent Director, with the assistance of Fluor’s internal legal counsel, is primarily responsible for monitoring any such communications from stockholders and other interested parties to the Board, individual directors, the Lead Independent Director or the independent directors as a group, and provides copies or summaries of such communications to the other directors as he considers appropriate.

Communications will be forwarded to all directors if they relate to substantive matters and include suggestions or comments that the Lead Independent Director considers to be important for the directors to know. The Board will give appropriate attention to written communications on issues that are submitted by stockholders and other interested parties and will respond if and as appropriate.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During 2022, Mr. Bennett, Ms. Eberhart, Mr. Hackett and Mr. Rose served on the Organization and Compensation Committee. During 2022, there were no compensation committee interlocks between the Company and other entities involving the Company’s executive officers and directors.

 

2023 PROXY STATEMENT   21

FLUOR CORPORATION

PROPOSAL 2 — ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION

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We are asking stockholders to vote on an advisory resolution to approve the Company’s executive compensation as reported in this proxy statement.

We urge stockholders to read the “Compensation Discussion and Analysis” beginning on page 23, which describes in more detail how our executive compensation policies and procedures operate and are designed to achieve our compensation objectives, as well as the Summary Compensation Table and related compensation tables and narrative, which provide detailed information on the compensation of our named executive officers.

In accordance with Section 14A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and as a matter of good corporate governance, we are asking stockholders to approve the following advisory resolution at the annual meeting:

RESOLVED, that the stockholders of Fluor Corporation (the “Company”) approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission in the Compensation Discussion and Analysis, the Summary Compensation Table and the related compensation tables and narrative in the Proxy Statement for the Company’s 2023 annual meeting of stockholders.

This advisory resolution, commonly referred to as a “say on pay” resolution, is non-binding on the Board. Although non-binding, the Board and the Organization and Compensation Committee will review and consider the voting results when evaluating our executive compensation program. An advisory stockholder vote on the frequency of stockholder votes to approve executive compensation is required to be held at least once every six years. The Company last held an advisory vote on frequency in 2017. After consideration of the vote of stockholders at the 2017 annual meeting of stockholders and other factors, the Board decided to hold advisory votes to approve executive compensation annually until the next advisory vote on frequency, which is being held this year and is presented as Proposal 3 below. Unless the Board modifies its policy on the frequency of future advisory votes to approve executive compensation after taking into consideration the stockholders’ vote on Proposal 3 below, the next advisory vote to approve executive compensation will be held at the 2024 annual meeting of stockholders.

BOARD RECOMMENDATION ✓

THE BOARD RECOMMENDS A VOTE FOR THE APPROVAL OF THE ADVISORY RESOLUTION TO APPROVE EXECUTIVE COMPENSATION.

 

22   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis describes the principles, objectives and features of our compensation program for our named executive officers (“NEOs”), including the decisions made under this program for 2022. For 2022, our NEOs were:

EXECUTIVE SUMMARY

In 2022, we demonstrated our resilience, continued our growth and remained steadfast in taking action to achieve positive results. Against a backdrop of the prolonged impact of the COVID-19 pandemic, conflict in Eastern Europe and increasing inflation and interest rates, we maintained our focus on the four strategic priorities we announced in 2021:

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Driving growth across the portfolio by expanding into markets outside of the traditional oil and gas sector, including energy transition and chemicals, critical minerals, life sciences, advanced technology, digitalization, government services and infrastructure;

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Pursuing contracts with fair and balanced terms by focusing on more balanced, risk-adjusted agreements that reward Fluor for value;

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Reinforcing financial discipline by maintaining a strong cash position and generating predictable cash flow and earnings; and

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Fostering a high-performance culture with purpose by advancing our diversity, equity and inclusion efforts, promoting social progress, advancing sustainability and delivering execution excellence.

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These strategic priorities serve to set a foundation for sustained and profitable growth as we pursue our strategic intent to become the preeminent leader of professional and technical solutions for our clients while maintaining our global leadership in the engineering and construction industry. Throughout 2022, we demonstrated our progress in advancing these strategic priorities, reducing our debt, improving our backlog and maintaining a strong cash position. Some key highlights of our 2022 performance include:

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Our 2022 new awards doubled to $19.8 billion, with 67% of new awards from outside of our traditional oil and gas markets;

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At December 31, 2022, our ending backlog was up 25% over the previous year and 63% was reimbursable;

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In February 2022, we renewed and expanded our credit facility, and since 2021 we have redeemed $550 million of our outstanding notes;

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In the second quarter of 2022, NuScale Power Corporation, in which we are the majority investor, became a public company (NYSE: SMR) through a reverse recapitalization with a publicly-traded special purpose acquisition company; and

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We continued to make progress on our goal to achieve net zero emissions for Scopes 1 and 2 GHG emissions by the end of 2023 and continued to advanced our DE&I efforts across the Company.

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2023 PROXY STATEMENT   23

FLUOR CORPORATION

Our executive compensation program is designed to link real pay delivery with performance by establishing rigorous goals for our performance-based annual and long-term incentives that reinforce our business strategy and support long-term value creation for the Company and our stockholders.

Annual Incentives recognize and reward achievement of near-term objectives that support long-term value creation, including annual goals for EBITDA and cash flow from operations, and safety targets, as well as individual achievement of annual strategic goals. Our progress in advancing our strategic priorities in 2022 is reflected in the increase of our stock price from $24.77 at the end of 2021 to $34.66 at the end of 2022 and our increased net income and consolidated segment profit for 2022 over those of 2021. Average 2022 annual incentives for our NEOs were 102% of target, and ranged individually from 92% to 131%.

Long-term incentives comprise the biggest portion of our NEO annual compensation opportunity and are partially based on financial performance over a three-year performance period. Performance-based long-term incentive awards with a performance period ending in 2022 earned 44% of target units, reflecting the rigor of the underlying goals.

 

24   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

The dollar value realized from performance-based long-term incentives with a performance period ending in 2022 was 183%, reflecting the increase in our stock price during the performance period.

Our compensation mix reinforces our commitment to pay-for-performance alignment. As shown in the charts below, in 2022, 90% of our CEO’s target total direct compensation (“TDC”) and an average of approximately 73% of our other NEOs’ target TDC was in the form of variable compensation, where realized pay depends on achievement of performance objectives and the price of the Company’s common stock.

(1)

Target TDC consists of actual base salary, target annual incentive and the value of all long-term incentives on the date of the award.

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(2)

Other NEOs’ Target TDC does not include Mr. Boeckmann, as he was not included in the 2022 annual incentive plan and did not receive the long-term incentives awarded to the other NEOs because he had already announced his retirement by the time the 2022 compensation decisions were made.

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For 2022, annual incentives for NEOs were paid in cash and based on the achievement of pre-established financial, operational and annual strategic goals for the year. Long-term incentives included a mix of restricted stock units (“RSUs”), performance-based equity awards (“Performance Awards”) and non-qualified stock options. The Performance Awards granted in 2022 are settled in shares based on achievement of earnings per share (“EPS”) and return on invested capital (“ROIC”) goals over three one-year periods, as well as the Company’s three-year cumulative total shareholder return (“TSR”) relative to companies in the S&P 500 on the date of the award (“Relative TSR”).

 

2023 PROXY STATEMENT   25

FLUOR CORPORATION

In making decisions regarding the compensation opportunities for the NEOs for 2022, the Organization and Compensation Committee (the “Committee”) took into account market conditions and performance, and also considered market data for our compensation peer group (as described beginning on page 37, the “Peer Group”) and general industry peers.

The Committee took the following specific actions with respect to NEO compensation for 2022:

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Increased base salaries for some of the NEOs (with increases ranging between 3-5%) to better align with similar positions in our Peer Group and maintain the competitiveness of our overall compensation program.

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In response to market practice, modified our 2022 annual incentive program by replacing the corporate net earnings performance measure with earnings before interest, taxes, depreciation and amortization (“EBITDA”).

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To increase emphasis on shareholder return, Relative TSR was changed from a modifier to a performance measure in our 2022 Performance Awards, with final payout to be based on: (i) 40% EPS, (ii) 40% ROIC and (iii) 20% Relative TSR.

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Maintained the same mix of long-term incentive awards as 2021, with 50% of the awards being Performance Awards, 35% RSUs and 15% non-qualified stock options.

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Our executive compensation policies reflect our strong focus on sound governance. As in prior years, the following practices and policies were in effect during 2022:

 

26   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

We use a balanced approach to compensation with a variety of pay elements to support the attraction and retention of key executive talent necessary to run our business, and reward the achievement of both short- and long-term goals, as described below:

 

2023 PROXY STATEMENT   27

FLUOR CORPORATION

COMPONENTS OF 2022 NEO COMPENSATION

The Company provides NEOs with base salaries for a competitive, stable level of income, since other elements of their direct compensation are at-risk based on Company performance. The Committee reviews base salaries for NEOs annually and upon a change in responsibilities.

In establishing and annually evaluating base salary levels, the Committee and, with respect to the Chairman and CEO, the independent directors of the Board consider the following factors:

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Peer Group data and general industry survey data for comparable positions prepared by the Committee’s independent consultant;

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Individual level of responsibility, leadership, performance and contributions to the Company;

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Internal pay equity based on relative duties and responsibilities; and

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The recommendations of the Chairman and CEO with respect to the base salary levels of the NEOs other than the Chairman and CEO.

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Following the annual review at the beginning of 2022, Mr. Constable’s and Mr. Boeckmann’s base salaries remained unchanged, while the base salaries of Messrs. Brennan, D’Agostino, Fields and Reynolds increased between 3.0% and 5.0% over their respective 2021 base salaries. The 2022 annualized base salaries for the NEOs as of December 31, 2022 (and for Mr. Boeckmann, as of his last day of employment) were as follows:

Cash-based annual incentives are provided to motivate and reward NEOs for achieving annual performance objectives. In 2022, each of the NEOs, other than Mr. Boeckmann, participated in the annual incentive award program and had a target annual incentive amount established as a percentage of annual base salary. This target opportunity reflects each NEO’s respective organizational level, position and responsibility for achievement of the Company’s financial and strategic goals and aligns with market practice. Mr. Boeckmann did not participate in the annual incentive award program in 2022 because he had previously announced his intention to retire in May 2022.

The 2022 target annual incentives for each NEO who participated in the 2022 annual incentive award program were as follows:

NEOs could receive from zero to 200% of their target annual incentive amounts, depending on the extent to which applicable performance goals were achieved. The types of measures, relative weightings and goals are determined by the Committee each year.

 

28   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

When determining performance measures and goals, the Committee considers the Company’s annual operating plan and strategic priorities for the year. For 2022, the performance measures were a combination of objective financial targets and strategic and safety performance measures. Target levels of achievement against these goals were tied to goals established at the beginning of the year. The use of multiple financial and strategic goals prevents an overemphasis on any one financial metric and focuses the NEOs on key areas of importance to the Company and its stockholders. The 2022 performance measures, along with their respective weights, for the NEOs were as follows:

EBITDA:   EBITDA is defined as earnings before interest, taxes, depreciation and amortization.

Cash Flow from Operations:   Cash flow from Operations is defined as total segment EBITDA plus the change in the business segment working capital accounts (accounts receivable, work in progress, advance billings and accounts payable), less cash flow effects of equity method investments and cash flow effects of property, plant and equipment transactions.

Mission Solutions EBIT (Segment Profit):   Mission Solutions Earnings Before Interest and Tax (“EBIT”), the profit measure used for compensation purposes, is typically the same as segment profit, the profit measure reported externally in our financial statements. Annual incentive determinations for executive officers who are group presidents of other business groups include EBIT performance measures for their applicable business groups.

Safety:   Safety performance for corporate-level executive officers is assessed based on the Company’s overall safety performance using both leading and lagging performance indicators. For executive officers serving as business group presidents, the assessment is based on the overall safety performance of the business groups for which they are responsible.

Strategic Performance:   Strategic performance for each NEO was measured against qualitative annual goals identified at the beginning of the year, which relate to the Company’s strategic priorities and include DE&I objectives.

At the time the Committee approved the performance measures and goals in February 2022, it also approved definitions of EBITDA, cash flow from operations and Mission Solutions EBIT that aim to hold management accountable for results from Fluor’s core business operations, which fall under their control, by excluding the following items: (i) expenses, income, gains or losses and taxes related to discontinued or to be divested operations; (ii) the effect of changes in tax laws, accounting principles, or other such laws or provisions affecting reporting results; (iii) restructuring charges; (iv) NuScale operating results; (v) gains or losses resulting from the curtailment or settlement of defined benefit pension plans; (vi) significant asset impairments; (vii) effects of significant natural disasters; (viii) significant litigation and regulatory costs and settlements or associated damages; (ix) the impact of foreign currency re-measurement, including embedded derivative effects; (x) costs of debt extinguishment and (xi) significant earnings impact related to certain cash-settled incentive awards to non-executive officers arising from material changes to the Company’s stock price. Subsequently, when approving the final annual incentive payout, the Committee determined to also exclude cash flow effects of an unplanned acceleration of incentives to a subcontractor which facilitated attainment of a significant project milestone.

 

2023 PROXY STATEMENT   29

FLUOR CORPORATION

The performance ranges for the EBITDA, cash flow from operations and Mission Solutions EBIT measures, together with the actual achievement of the measures and the resulting performance ratings, are presented below:

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(1)

The performance measures are defined above under “— Performance Measures for 2022.”

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(2)

The amounts shown exclude certain items discussed above under “— Performance Measures for 2022.”

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The 2022 annual strategic goals and key achievements for each NEO participating in the 2022 annual incentive program were as follows:

 

30   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

Achievement of the strategic performance measure varied among the NEOs because of the differences in responsibilities and individual accomplishments.

Each NEO’s strategic performance rating, other than for Mr. Constable, was determined based on evaluations and recommendations by Mr. Constable that were assessed and subsequently approved by the Committee. In the case of Mr. Constable, strategic performance was assessed by the independent directors of the Board after consideration of a recommendation from the Committee.

The final 10% of the annual incentive was determined based on achievement of the safety performance measure from management’s assessment of the overall safety performance of the Company or, in the case of Mr. D’Agostino, the Mission Solutions business group, as reviewed and approved by the Committee. No NEO’s aggregate compensation was materially affected by the level of achievement of this measure.

Once the level of achievement for each measure was determined, each NEO’s overall performance rating was calculated by multiplying each measure’s rating (which can range from 0.00 to 2.00) by its relative weighting, and then aggregating those amounts. The overall performance rating was then multiplied by the individual’s target annual incentive amount to determine the annual incentive payment for each NEO. Based on performance, annual incentive award cash payouts averaged 102% of target for the NEOs.

The 2022 target annual incentive percentages and amounts for each NEO who participated in the 2022 annual incentive program, as well as the actual annual incentive amounts to be paid, are as follows:

 

2023 PROXY STATEMENT   31

FLUOR CORPORATION

The stockholder-approved 2020 Performance Incentive Plan allows the Committee to grant various forms of long-term equity incentives. The Committee’s objectives in granting long-term equity awards are to motivate NEOs and reward the achievement of superior operating results and TSR, facilitate the attraction and retention of key management personnel and align the interests of management and stockholders through equity ownership.

NEOs receive long-term incentive awards that reflect grant date accounting values (not ultimately earned amounts), based on market considerations as well as individual contributions, experience, advancement potential and internal pay equity. In 2022, when determining the compensation for the NEOs, the Committee determined that Performance Awards would comprise 50% of the long-term incentive award to NEOs, RSUs would comprise 35% and non-qualified stock options would comprise 15%. Mr. Boeckmann did not receive long-term incentive awards in 2022 because he had already announced his retirement when the grants were made to the other NEOs.

The Committee believes that the mix of long-term incentive components aligns the interests of NEOs with those of stockholders by encouraging NEOs to focus on long-term growth of the Company, while providing a balanced pay package that aligns with the practices of the Peer Group and mitigates potential compensation-related Company risk. In determining the relevant allocations, Performance Awards were valued at the target performance level (and converted into performance units based on the closing stock price on the 2022 award date), RSUs were valued at the fair value (closing stock price) on the award date and stock options were valued using a Black-Scholes option pricing model. RSUs and stock options vest one-third per year in each of the years following the award date, subject to the applicable NEO’s continued employment on each vesting date. Stock options, once vested, are exercisable for ten years following the grant date, subject to continued employment (except in the event of certain qualified terminations of employment).

The 2022 target annual long-term incentive award values approved by the Committee were as follows:

The total value of the 2022 long-term incentive awards to Mr. Constable increased by approximately 2.7% over the 2021 levels to recognize his strong leadership and improved performance of the Company, while the total value of the 2022 long-term incentive awards for Messrs. Brennan, D’Agostino, Fields and Reynolds were the same as the 2021 levels.

The Committee determines the dollar value of long-term incentive awards for NEOs at its first regularly scheduled meeting each year, which is held in February. The determinations are made at that time to coincide with the annual performance review. The equity awards are then awarded shortly following the publication of our annual results.

The Performance Awards awarded to the NEOs in 2022 are earned over a three-year performance period, which started on January 1, 2022 and ends on December 31, 2024. The awards will be earned based on actual performance for each year during the three-year performance period relative to goals set for that year, and will vest and be settled in shares in March 2025, subject to continued employment (except in the event of certain qualified terminations of employment) and performance achievement. Upon vesting, NEOs will receive the value of any accrued dividends paid by the Company with respect to shares earned. The three-year performance periods and vesting requirements are intended to facilitate retention of the participating executives and to link the value of the awards to long-term TSR.

The Committee established the following performance criteria and relative weightings for the 2022 Performance Awards for NEOs:

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40% of the total award is based on EPS;

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40% of the total award is based on ROIC; and.

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20% of the total award is based on Relative TSR.

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32   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

The Committee sets performance goals for EPS and ROIC at the beginning of each year, and after the end of the year determines the final performance ratings (which can range from 0.0 to 2.0) based on the actual achievement of the performance measures. At the end of the three-year period, the Committee will average the EPS and ROIC performance ratings from each year to determine a final EPS and ROIC performance rating. Relative TSR will be based on the three-year cumulative TSR over the three-year performance period relative to the companies in the S&P 500 Index on the date of grant, such that if the Company’s final TSR ranks at the 25th percentile, 50th percentile or 75th percentile of the S&P 500, the Relative TSR performance measure will receive a performance rating of 0.5, 1.0 and 2.0, respectively. The Committee will determine the number of earned units by multiplying the number of target units by the final overall performance ratings for EPS, ROIC and Relative TSR with the weightings stated above. In no event will the number of earned shares exceed two times the target number of shares.

EPS represents diluted earnings per share attributable to Fluor from continuing operations. ROIC is calculated by dividing full year corporate net earnings attributable to Fluor from continuing operations (excluding after-tax net interest) by Net Invested Capital. Net Invested Capital is defined as total stockholders’ equity (excluding accumulated other comprehensive income) plus total external long and short-term debt (excluding non-recourse debt) minus cash, current and non-current marketable securities more than $1.0 billion. EPS and ROIC exclude certain items discussed above under “— Performance Measures for 2022.”

The EPS and ROIC performance targets for 2022 and the actual achievement and performance ratings are set forth below.

The Committee believes that using three annual performance goals instead of a single three-year goal best orients executives to focus on long-term achievements, while avoiding disincentives or windfalls due to volatile economic factors such as commodity prices and market economies that are difficult to forecast and impact our operating margins and growth. The long-term financial measures are different from the annual incentive financial measures to avoid paying twice for the same performance, and there is a three-year Relative TSR performance measure to align pay with stockholder value. When setting these performance goals, the Committee considered the Company’s business outlook and other corporate financial measures. The Committee also considered how likely it will be for the Company to achieve the goals. We believe that the target goals have been established at levels that should be appropriately difficult to attain. Goals above target are stretch goals and will require a challenging level of performance to be achieved.

An NEO’s unvested award is subject to risk of forfeiture if, prior to vesting, the NEO’s employment with the Company is terminated for any reason other than retirement, death, disability, or a qualifying termination within two years after a change in control of the Company.

The eventual determination of the payout of 2022 Performance Awards for the NEOs is illustrated below.

 

2023 PROXY STATEMENT   33

FLUOR CORPORATION

In 2020, the Committee granted Performance Awards to certain NEOs, which were subject to three one-year performance periods, based on financial performance criteria established at the beginning of each year, as set forth in the table below. Following each performance period, the Committee determined the actual achievement of the performance measures for the previous year. The performance measures and relative weightings for the 2020 Performance Awards were as follows: 50% of the total award was based on EPS and 50% of the total award was based on ROIC. At the end of the three-year period, the Committee averaged the performance outcomes for the three one-year performance periods and determined the number of earned units by multiplying the number of target units awarded in 2020 by the average of the three annual performance ratings (which could range from 0.00 to 2.00), and then adjusted the earned number of units based on the Company’s three-year cumulative TSR relative to companies in the S&P 500 Index on the date of grant.

Based on the Company’s performance over the performance period, this award was earned at 44% of target, as reflected in the Outstanding Equity Awards at 2022 Year End table.

A portion of the 2020 Performance Award for Mr. Brennan, who was not an executive officer when compensation levels and opportunities for the NEOs were initially established in 2020, was based on the same performance measures as the other NEOs, including the TSR modifier, but was payable in cash.

The performance targets for each year of the performance period, together with the actual achievement and performance ratings, are set forth below.

OTHER COMPENSATION DECISIONS

We periodically grant cash or equity retention awards to reflect competitive market situations, address specific project objectives or reinforce succession planning objectives. No new retention awards were made to NEOs in 2022. In recognition of Mr. Boeckmann’s vital contributions to the Company during his recent tenure as Executive Chairman, in 2022 the Board determined that Mr. Boeckmann had fulfilled the objectives requested by the Board when he came out of retirement to rejoin the Company in 2019, including his active support of the merger of NuScale Power LLC (“NuScale”) with Spring Valley Acquisition Corp. completed in May 2022 and the investment by Japan Bank for International Cooperation into NuScale in April 2022, leading the Board in the recruitment of four new directors and the appointment of our current CEO and management team, supporting the development of our corporate strategy and overseeing a number of other strategic

 

34   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

and operational initiatives. Accordingly, the Board determined that Mr. Boeckmann (1) would not be required to serve out the remaining six months of the three-year retention period set forth in his retention agreement dated November 26, 2019, and (2) would receive the full amount of  $1,750,000 set forth in the retention agreement upon his retirement in May 2022. The Board also considered that the timing of Mr. Boeckmann’s decision to not stand for reelection and his retirement as of the 2022 Annual Meeting date supported a smooth transition to the Board’s new Chairman.

CHANGES TO EXECUTIVE COMPENSATION FOR 2023

To strengthen alignment between pay and financial results, the Committee has updated the weightings of the performance measures included in the annual incentive plan. Effective in 2023, the weighting of the strategic performance measure will be decreased from 30% to 20%, with corresponding 5% increases in the EBITDA and Cash Flow from Operations (to be renamed Cash Flow from Segments in 2023) financial performance measures, as shown below.

In addition, to better drive alignment with financial performance, effective in 2023 the weightings of the performance measures for long-term Performance Awards for executive officers will be modified to:

EBT will be based on actual achievement of three annual performance goals for each year during the three-year performance period. Relative TSR will remain based on the three-year cumulative TSR over the performance period relative to the companies in the S&P 500 index on the date of grant, such that if the Company’s final TSR ranks in the 25th percentile, 50th percentile or 75th percentile of the S&P 500, the Relative TSR performance measure will receive a performance rating of 0.5, 1.0 and 2.0, respectively.

OTHER ELEMENTS OF NEO COMPENSATION

In 2022, in lieu of reimbursement of typical perquisites, each of the NEOs was paid a taxable monthly allowance as set forth in the “All Other Compensation” table. The Committee believes that these allowances are reasonable costs and are justified by the perceived value to the NEOs. The allowances are intended to provide convenience considering the demands on the NEOs and are considered an important part of a competitive compensation package in our industry. We do not pay for items such as automobile leasing or tax and financial planning, which are items that are frequently reimbursed or paid directly by our peers. When determining the allowance amounts, the Committee considered the value of perquisites provided to similarly situated executives in our Peer Group. In addition, NEOs are required to have a physical examination each year that is paid for by the Company, with results shared with the Company. NEOs may have spousal travel paid for by the Company only when it is for an approved business purpose, in which case a related tax gross-up is provided. NEOs can make personal use of charter aircraft in conjunction with a business purpose, but the NEO is required to reimburse the Company for the incremental operational cost of such personal use.

The NEOs are eligible to participate in Fluor’s Executive Deferred Compensation Program. The Company offers this program to provide retirement and tax planning flexibility and to remain competitive with other companies within our Peer Group and general industry. Please refer to the discussion in the Nonqualified Deferred Compensation section beginning on page 50 for a more detailed discussion of this program.

 

2023 PROXY STATEMENT   35

FLUOR CORPORATION

The Company maintains a severance policy pursuant to which each of the NEOs would be eligible to receive cash severance in the event of a termination of employment by the Company without cause. The Company believes its severance policy assists in attracting and retaining qualified executives. The level of any cash severance payment is based upon salary and years of service at the time of separation. In addition, each NEO has a change-in-control agreement that provides additional payments and other benefits if the executive is terminated without cause or if the NEO terminates employment for good reason within two years following a change in control of the Company. The change-in-control agreements are designed to reinforce and encourage the continued attention and dedication of the executives without distraction in the face of potentially disruptive circumstances arising from the possibility of a change in control and to serve as an incentive to their continued commitment to, and employment with, the Company and align their interests with those of the Company’s stockholders with respect to a potential change-in-control-transaction. All potential change-in-control payments are “double trigger,” meaning an NEO must incur a qualifying termination of employment following a change in control to be eligible for these payments. In addition, if any excise taxes are triggered in connection with a change in control, our change-in-control agreements do not provide for a tax gross-up. The Company will, instead, automatically reduce any payments due to the NEOs under their agreement to the extent necessary to prevent any portion of these payments from being subject to those excise taxes, but only if by reason of the reduction, the executive’s after-tax benefit of the reduced payments exceeds the after-tax benefit if such reduction were not made.

Please refer to the discussion under “Potential Payments Upon Termination or Change in Control” beginning on page 51 for a more detailed discussion of these arrangements. Severance and change-in-control benefits are provided to be competitive with the Peer Group.

ESTABLISHING EXECUTIVE COMPENSATION

The Committee has responsibility for establishing and implementing the Company’s executive compensation philosophy. The Committee, with the advice of its independent compensation consultant, reviews and determines all components of NEOs’ compensation (other than with respect to the compensation of our Chairman and CEO, which the Committee reviews and recommends for approval by our independent directors), including making individual compensation decisions and reviewing and revising the Company’s compensation program and practices.

The Committee has established the following compensation philosophy and objectives for the NEOs:

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Align the interests of NEOs with those of the stockholders.   The Committee believes it is appropriate to tie a significant portion of executive compensation to the value of the Company’s stock to closely align the interests of NEOs with those of our stockholders. The Committee also believes that executives should have a meaningful ownership interest in the Company and as such maintains and regularly reviews executive stock ownership guidelines.

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Have a significant portion of pay that is performance-based.   Fluor expects superior performance from our executives. Our executive compensation programs are designed to reward executives when performance results for the Company and the executive meet or exceed stated objectives. The Committee strongly believes that compensation paid to executives should be closely aligned with the performance of the Company relative to these objectives.

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■

Provide competitive compensation.   The Company’s executive compensation programs are designed to attract, retain and motivate highly qualified executives critical to achieving Fluor’s strategic objectives and building stockholder value.

​

The Committee reviews the Company’s compensation philosophy and objectives each year to determine if revisions are necessary considering market conditions, the Company’s strategic goals or other relevant factors. In each of the last five years, the Committee determined that no revisions to the executive compensation philosophy and objectives were necessary, although the Committee has adjusted the specific elements of compensation used to implement its philosophy as the business and operating environment have evolved.

In addition, the Committee reviewed the incentive compensation we provide to our executives, including our NEOs, and evaluated the mix of plans and performance criteria, the Committee’s ability to exercise discretion over certain components of compensation and our risk management practices generally. Based on this review, the Committee believes that our compensation program is designed to appropriately align compensation with our business strategy and not to encourage behavior that could create material adverse risks to our business.

 

36   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

The Committee has the authority under its charter to engage the services of outside legal counsel, compensation consultants and other advisors. In 2022, the Committee again engaged Frederic W. Cook & Co., Inc. (“FW Cook”) to serve as its independent compensation consultant to advise the Committee on all matters related to executive and non-management director compensation. FW Cook conducts an annual review of the total compensation program for the Chairman and CEO and the other NEOs.

In 2022, as part of the Committee’s oversight of certain aspects of risk, FW Cook conducted a broad-based review of the Company’s compensation program and discussed its findings with the Committee, indicating that it believes the Company’s compensation programs do not encourage behaviors that would create material risk for the Company. FW Cook also provided written and verbal advice at Committee meetings, attended executive sessions of the Committee to respond to questions, and had individual calls and meetings with the chair of the Committee to provide advice and perspective on executive compensation issues. FW Cook was engaged by, and reports directly to, the Committee and does not perform any other services for the Company. The Committee has determined that FW Cook’s engagement does not raise any conflicts of interest.

In making compensation decisions, the Committee looks at the practices of our Peer Group. The Committee annually reviews with FW Cook the composition of the Peer Group and makes refinements if necessary, based on objective criteria established by the Committee.

Since 2009, the Committee has applied a generally consistent process and set of criteria for selection of the Peer Group. Potential peer companies were identified by assessing our direct competitors and key customers; companies commonly identified as direct engineering and construction peers (based on disclosures in their most recent proxy statements); companies with generally comparable pay models; and companies with revenue and number of employees ranging from 0.25x to 4.0x of the Company’s revenue and employees, and market capitalization ranging from 0.2x to 5.0x of the Company’s market capitalization, subject to exception for direct competitors and other engineering and construction peers.

For 2022, the Committee determined that the Peer Group selection criteria should remain unchanged, but removed McDermott International because it was no longer a publicly traded company.

The companies comprising our Peer Group for purposes of establishing 2022 compensation were:

​

*

Direct competitors and engineering and construction peers

​

The Committee reviews benchmarking comparisons prepared by its compensation consultant for each NEO against similar positions within the Peer Group.

Before the Committee makes decisions on executive compensation, the Chairman and CEO reviews compensation for the other NEOs other than himself, and makes recommendations to the Committee based on their individual and group performance. Specifically, the Chairman and CEO proposes to the Committee current year base salary adjustments, target annual incentive awards and long-term incentive awards for each of the other NEOs. In addition, the Committee reviews and approves the compensation actually paid to the NEOs after consideration of the recommendations made by the Chairman and CEO.

The independent members of the Board assess the Chairman and CEO’s performance each year, determine the Chairman and CEO’s annual incentive payout for the prior year and set target compensation for the following year, including any base salary adjustment, target annual incentive award and long-term incentive awards.

 

2023 PROXY STATEMENT   37

FLUOR CORPORATION

OTHER ASPECTS OF OUR EXECUTIVE COMPENSATION PROGRAM

We hold an annual say-on-pay vote to approve our NEO compensation. At our 2022 annual meeting of stockholders, the compensation of our NEOs was approved by stockholders, with approximately 84% of the votes cast for approval. The Committee evaluated the results of the 2022 advisory vote following the annual meeting. The Committee also considered many other factors in evaluating our executive compensation program, including the Committee’s assessment of the interaction of our compensation plans with our corporate business objectives, evaluations of our program by the Committee’s independent compensation consultant, including with respect to “best practices,” a review of data of our Peer Group, and meetings between members of the Committee and investors. Taking all this information into account, the Committee did not make any changes to our 2022 executive compensation program and policies because of the 2022 say-on-pay vote, since most elements of compensation were established prior to the annual meeting. However, to strengthen alignment between pay and financial performance, the Committee increased the weighting assigned to financial performance measures and reduced the weight assigned to strategic objectives as discussed above under “Changes to Executive Compensation for 2023.”

Under our clawback policy, in the event of a material restatement of the Company’s financial results, the Board or a Board committee will evaluate the circumstances and may, in its discretion, recover from any current or former executive officer or employee the portion of any performance-based compensation earned by that executive or employee during the periods materially affected by the restatement that would not have been earned had performance been measured on the restated basis. Appropriate language regarding the policy has been included in applicable documents and award agreements. We intend to update our clawback policy as necessary to comply with listing standards adopted by the New York Stock Exchange implementing the SEC’s recently finalized Exchange Act Rule 10-D-1.

Outside of our clawback policy, we also consider other potential recourse mechanisms as part of our approach to executive compensation. In addition to potential legal remedies and disciplinary or other employment actions that may be available to the Company, NEO compensation may be subject to forfeiture, recovery, or adjustment in a variety of circumstances under our other policies and agreements. These include: (i) our ability to pursue appropriate remedies for violations of our Code of Conduct; (ii) forfeiture of compensation if an NEO’s employment is terminated for “cause” under the terms of our agreements with NEOs, which includes, among other things, termination for dishonesty, fraud, willful misconduct, breach of fiduciary duty, conflict of interest, commission of a felony, material failure or refusal to perform job duties in accordance with Company policies, material violation of Company policy that causes harm to the Company or its subsidiaries or other wrongful conduct of a similar nature and degree; (iii) forfeiture and recovery of compensation in the event an NEO breaches applicable restrictive covenants; and (iv) potential downward adjustments by the Committee to pay opportunities or incentive plan payouts.

Executive officers are required to hold Fluor stock to align their financial interests with those of our stockholders. The Company maintains the following stock ownership guidelines for NEOs based in the U.S.:

NEOs may sell shares of Fluor stock if the guidelines are met after the sale. To the extent an NEO has not satisfied the guidelines, an NEO may only sell up to 50% of the net shares acquired from the exercise of stock options or the vesting of RSUs and Performance Awards. Unvested RSUs and Performance Awards for which performance goals have been achieved (and for which only time-based vesting remains) are considered as owned by the NEO in determining whether the NEO has met the ownership guidelines. As of March 1, 2023, each of the currently employed NEOs has satisfied these stock ownership guidelines.

 

38   2023 PROXY STATEMENT

COMPENSATION DISCUSSION AND ANALYSIS

Our insider trading policy prohibits all directors, employees (including executive officers) and contractors of the Company and its subsidiaries from engaging in short term or speculative trading in Company securities. It is against the policy for directors and employees to trade in puts, calls or other publicly traded “over-the-counter” options in Company securities, or to sell Company securities short. In addition, directors and employees are prohibited from engaging in any hedging or monetization transactions involving Company securities (such as zero cost collars and forward sale contracts).

Directors and employees are also prohibited from holding Company securities in a margin account or pledging Company securities as collateral for a loan or otherwise. The policy does not prohibit broker-assisted exercise or settlement of equity awards granted by the Company that may involve an extension of credit only until the sale is settled, provided that any such transaction complies with the terms of the policy. The insider trading policy also applies to securities of the Company’s controlled subsidiaries.

 

2023 PROXY STATEMENT   39

FLUOR CORPORATION

ORGANIZATION AND COMPENSATION COMMITTEE REPORT

Management of the Company has prepared the Compensation Discussion and Analysis as required by Item 402(b) of Regulation S-K, and the Organization and Compensation Committee has reviewed and discussed it with management. Based on this review and discussion, the Committee recommended that the Compensation Discussion and Analysis be included in the proxy statement for the Company’s 2023 annual meeting of stockholders.

The Organization and Compensation Committee

James T. Hackett, Chair
Alan M. Bennett
H. Paulett Eberhart
Matthew K. Rose

 

40   2023 PROXY STATEMENT

COMPENSATION TABLES

SUMMARY COMPENSATION TABLE

The table below summarizes the total compensation earned by or granted to each of the 2022 NEOs in the relevant years. The 2022 NEOs are the individual who held the position of principal executive officer in 2022, the individual who held the position of principal financial officer in 2022, and the three other highest paid executive officers. In addition, Mr. Boeckmann, who served as an executive officer during a portion of 2022 but not as of December 31, 2022, is considered an NEO because his total compensation in 2022 is above that of the fifth most highly compensated executive officer of the Company who served as an executive officer as of December 31, 2022.