2018 Guide to Effective Proxies

2.17.8 Pay for performance alignment | 417 6 TH EDITION | GUIDE TO EFFECTIVE PROXIES ANADARKO PETROLEUM CORPORATION Compensation Discussion and Analysis 2017 Pay Outcomes Demonstrate Pay and Performance Alignment Our financial and operating results in 2017 were largely in line with expectations while our relative TSR performance was in the bottom quartile. The incentive compensation realized by our NEOs was substantially below target and grant date value, as applicable, demonstrating that our program design appropriately aligns compensation levels with performance results. Pay Outcomes Demonstrate a Strong Pay-and-Performance Alignment 2017 TARGET VS. PAYOUT 85% 0% 100% 0% Target Actual Payout PUs AIP Incentive compensation realized by our NEOs for 2017 was substantially below target, demonstrating that our program design appropriately aligns compensation levels with performance results. Performance units relate to the three-year performance period ended December 31, 2017. TARGET 2017 AIP Score Adjusted Downward. After an assessment of the Company’s performance for the year in review, the Compensation Committee (referred to in this section of the proxy statement as the Committee) determined it was appropriate to reduce the calculated performance score for the 2017 AIP of 92.6% to 85% for the executive officers. Company Performance Score 92.6% 85% (~8%) Negative Committee Discretion Approved AIP Performance Score = 2014 Performance Units — No Payout Earned. Based on Anadarko’s performance results for the three-year period ended December 31, 2017, the executive officers did not earn any of the 2014 performance units. Accordingly, there was no payout associated with these awards. Paid Out PUs Vested/ (38.3%) *Out of 12 companies Absolute TSR Performance Relative TSR Performance 10 th Place* 0 2014 Performance Unit Results (for the 3-year period ended December 31, 2017) 34 ANADARKOPETROLEUMCORPORATION 2018PROXYSTATEMENT Total of 02 pages in section 2.17.8 Pay for performance alignment Say on Pay votes are heavily focused on the perceived or demonstrated link between pay and performance. In response, companies are experimenting with new ways to demonstrate alignment between CEO pay and company performance, including performance relative to peer companies. Thanks to this experimentation, there are now new graphical ways to summarize and accentuate an admittedly complex topic. As there are multiple definitions of pay (see above) and of performance, including absolute or relative TSR, or achievement of relevant financial, operating or strategic goals and virtually every permutation of these variables has been utilized.

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