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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

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

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Preliminary Proxy Statement

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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

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Definitive Proxy Statement

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Definitive Additional Materials

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Soliciting Material under §240.14a-12

 

UnitedHealth Group Incorporated

(Name of Registrant as Specified In Its Charter)

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

 


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9900 Bren Road East
Minnetonka, Minnesota 55343

April 26, 2021

Dear Shareholder:

We cordially invite you to participate in our 2021 Annual Meeting of Shareholders to be held on Monday, June 7, 2021, at 11:00 a.m. Eastern Time. With the COVID-19 pandemic continuing to affect millions of people, we will once again hold our Annual Meeting virtually.

Over the past, unprecedented year, our 335,000 team members have distinguished themselves through their unwavering commitment to the health and safety of the people we are privileged to serve and have worked to deliver on our mission of helping people live healthier lives and helping the health system work better for everyone.

We released our inaugural Sustainability Report in 2020 to provide clarity to our stakeholders on our practices and progress. These efforts support and strengthen our ability to further fulfill our mission.

As a shareholder of UnitedHealth Group, you play an important role in our company by considering and taking action on the matters set forth in the attached proxy statement. We appreciate the time and attention you invest in making thoughtful decisions.

Attached you will find a notice of meeting and proxy statement containing information about the items upon which you will be asked to vote and the meeting itself, including different methods you can use to vote your proxy, including by internet, telephone and mail.

Every shareholder vote is important, and we encourage you to vote as promptly as possible. Instructions on how to participate in the Annual Meeting are included in the proxy statement.

Sincerely,

SIGNATURE SIGNATURE

Andrew Witty
Chief Executive Officer


Stephen Hemsley
Chair of the Board

Table of Contents

2021 Notice of Annual Meeting

Items of Business

    Proposal 1:  Elect the nine nominees set forth in the attached proxy statement to the Company's Board of Directors.

    Proposal 2:  Conduct an advisory vote to approve the compensation paid to the Company's named executive officers as disclosed in the attached proxy statement (a "Say on Pay") vote.

    Proposal 3:  Ratify the appointment of Deloitte & Touche LLP as the independent registered public accounting firm for the Company for the year ending December 31, 2021.

    Proposal 4:  Approve an amendment to the UnitedHealth Group 1993 Employee Stock Purchase Plan.

    Proposal 5:  Consider the shareholder proposal set forth in the attached proxy statement, if properly presented at the Annual Meeting.

Items of business may also include transacting any other business that properly may come before the Annual Meeting or any adjournments or postponements of the meeting.

Access to the Annual Meeting

In light of the continued impact of the coronavirus (COVID-19) pandemic, the 2021 Annual Meeting will be held in virtual format only. If you plan to participate in the Annual Meeting, please see the "Questions and Answers About the Annual Meeting and Voting" section in the attached proxy statement. Shareholders will be able to participate in, vote, view the list of shareholders of record and submit questions from any location.

Proxy Voting

Important.    Even if you plan to participate in the Annual meeting, we still encourage you to submit your proxy by internet, telephone or mail prior to the meeting. If you later choose to revoke your proxy or change your vote, you may do so by following the procedures under Question 12 of the "Questions and Answers About the Annual Meeting and Voting" section in the attached proxy statement.

By Order of the Board of Directors,

SIGNATURE

Dannette L. Smith
Secretary to the Board of Directors
April 26, 2021

June 7, 2021


 

11:00 a.m. Eastern Time


 

Our Annual Meeting can
be accessed virtually at:
www.virtualshareholder
meeting.com/UNH2021


 

 

Record Date


 

April 9, 2021


 

 

Only shareholders of record of the Company's common stock at the close of business on the record date are entitled to receive notice of, and to vote at, the Annual Meeting and any adjournments or postponements of the meeting.


 

 

IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD VIRTUALLY VIA THE INTERNET ON JUNE 7, 2021:


 

The Notice of Internet Availability of Proxy Materials, Notice of Annual Meeting of Shareholders, Proxy Statement and Annual Report are available at www.unitedhealthgroup.com/
proxymaterials
.


 

Table of Contents

Table of Contents

Proxy Summary

1

Board of Directors


 

PROPOSAL 1: Election of Directors

5

Director Nomination Process

5

Board Leadership Structure

9

Director Independence

10

Board Committees

11

Board Meetings and Annual Meeting Attendance

13

Board and Committee Evaluations

14

Communication with the Board of Directors

14

2021 Director Nominees

15

Director Compensation

20

2020 Director Compensation Table

23

Corporate Governance


 

Overview

25

Code of Conduct: Our Principles of Ethics & Integrity

27

Compliance and Ethics

27

Risk Oversight

28

Alignment of Environment, Social and Governance (ESG) with Our Long-Term Strategy

29

Executive Compensation


 

Executive Summary

32

Compensation Discussion and Analysis

35

Compensation and Human Resources Committee Report

51

Compensation and Human Resources Committee Interlocks and Insider Participation

51

2020 Summary Compensation Table

52

2020 Grants of Plan-Based Awards

55

Outstanding Equity Awards at 2020 Fiscal Year-End

57

2020 Option/Stock Appreciation Right Exercises and Stock Vested

58

2020 Non-Qualified Deferred Compensation

60

Executive Employment Agreements

61

Potential Payments Upon Termination or Change in Control

63

CEO Pay Ratio

64

PROPOSAL 2: Advisory Approval of the Company's Executive Compensation

66

Audit


 

Audit Committee Report

67

Disclosure of Fees Paid to Independent Registered Public Accounting Firm

69

Audit Committee's Consideration of Independence of Independent Registered Public Accounting Firm

70

Audit and Non-Audit Services Approval Policy

70

PROPOSAL 3: Ratification of Independent Registered Public Accounting Firm

71

Annual Meeting

 

PROPOSAL 4: Approval of the UnitedHealth Group 1993 Employee Stock Purchase Plan Amendment

72

Summary of the UnitedHealth Group 1993 Employee Stock Purchase Plan

73

U.S. Federal Income Tax Matters

74

Vote Required

75

Equity Compensation Plan Information

76

PROPOSAL 5: Shareholder Proposal to Reduce the Share Ownership Threshold for Calling a Special Meeting of Shareholders

77

Questions and Answers About the Annual Meeting and Voting

80

Householding Notice

88

Other Matters at Meeting

88

Other Information


 

Security Ownership of Certain Beneficial Owners and Management

89

Certain Relationships and Transactions

91

Appendix A — COVID-19 Response


93

Appendix B — Reconciliation of Non-GAAP Financial Measure


95

Appendix C — Amendment to the UnitedHealth Group 1993 Employee Stock Purchase Plan


96

Table of Contents

 

Proxy Summary

Business Results

We are a diversified health care company with a mission to help people live healthier lives and help make the health system work better for everyone. We work with health care professionals and other key partners to expand access to quality health care, so people get the care they need at an affordable price. We support the patient-physician relationship and empower people with the information, guidance and tools they need to make personal health choices and decisions. Our two complementary businesses — Optum and UnitedHealthcare — are driven by this unified mission and a vision to improve health care access, affordability, experiences and outcomes for the individuals and organizations we are privileged to serve. The breadth and scope of our diversified company help to consistently improve health care quality, access and affordability. We performed strongly in 2020 as we addressed uncertainties caused by the pandemic and undertook actions to address the impacts of the pandemic on health care professionals and our customers.

Financial

    Revenues increased 6.2% to $257.1 billion in 2020 from $242.2 billion in 2019;

    Operating earnings increased 13.8% year-over-year to $22.4 billion; net earnings increased 11.3% year-over-year to $15.4 billion; and cash flows from operations grew 20.1% year-over-year to $22.2 billion;

    Diluted earnings per share increased 11.9% to $16.03 per share from $14.33 in 2019. Adjusted earnings per share1 increased 11.7% to $16.88 per share from $15.11 per share in 2019;

    Return on equity at 24.9% in 2020 compared to 25.7% in 2019, reflecting the Company's strong overall operating performance and efficient capital structure;

    Total shareholder return in 2020 was 21%, and 65% from 2018-2020, reflecting continued strong fundamental performance; and

    Our annual cash dividend rate increased to $5.00 per share, representing a 16% increase over the annual cash dividend rate of $4.32 per share since the second quarter of 2019.

Awards and Recognition

    UnitedHealth Group was the top ranked company in the insurance and managed care sector on Fortune's 2021 "World's Most Admired Companies" list. This is the eleventh consecutive year UnitedHealth Group has ranked No. 1 overall in its sector. The Company ranked No. 1 on all nine key attributes of reputation — innovation, people management, use of corporate assets, social responsibility, quality of management, financial soundness, long-term investment value, quality of products and services and global competitiveness.

    The Company was named to the "All-Star" list of Fortune's 2021 top 50 most admired companies;

    UnitedHealth Group has been named to both the Dow Jones Sustainability World and North America Indices since 1999;

    UnitedHealth Group received a perfect score of 100 on the Human Rights Campaign Foundation's Corporate Equality Index 2021, earning the distinction of one of the "Best Places to Work for LGBTQ Equality";

    UnitedHealth Group was named one of America's Most JUST Companies by JUST Capital and Forbes in 2020. The JUST 100 rankings measure how U.S. companies perform on issues Americans care about most, including worker pay and treatment, customer respect, product quality and environmental impact;

    In 2020 and for the ninth consecutive year, The Civic 50, a Points of Light initiative that highlights companies that improve the quality of life in the communities where they do business, ranked UnitedHealth Group one of America's 50 most community-minded companies;

    The Carbon Disclosure Project named UnitedHealth Group to its Leadership Band in 2020 for efforts to reduce greenhouse gas emissions;

    The National Business Group on Health honored UnitedHealth Group with a 2020 "Best Employers: Excellence in Health & Well-Being" top-tier Platinum award;

    The Disability Equality Index® named UnitedHealth Group one of the best places to work for disability inclusion in 2021; and

    UnitedHealth Group has been ranked No. 6 in the nation on the 2021 Military Friendly® Employers list.

   


1
Adjusted earnings per share is a non-GAAP financial measure. Refer to Appendix B in this proxy statement for a reconciliation of adjusted earnings per share to the most directly comparable GAAP measure.

2021 Proxy Statement    |    Proxy Summary    1


Table of Contents

Corporate Governance

UnitedHealth Group is committed to meeting high standards of ethical behavior, corporate governance and business conduct. Our company, our Board of Directors (the "Board") and our people are committed to the shared cultural values of integrity, compassion, innovation, relationships and performance. This commitment has led us to implement many governance best practices.

Board Structure and Composition

Our directors are elected annually by a majority vote of our shareholders. Our current Board structure separates the positions of Chair of the Board and CEO. We have a Chair of the Board and a Lead Independent Director, and seven of our nine director nominees are independent.

Public Company Board Service Limits

Our directors may serve on no more than three other public company boards and our CEO may serve on no more than one other public company board.

One Share, One Vote

The Company does not have a dual-class share structure. Each share of Company common stock is entitled to one vote.

Proxy Access

A shareholder or group of shareholders who have owned at least 3% of our common stock for at least three years, and who comply with specified procedural and disclosure requirements, may include in our proxy materials shareholder-nominated director candidates representing up to 20% of the Board.

Board Refreshment, Tenure and Diversity

Since January 2017, we have appointed six new directors to the Board. Five of these directors are standing for election this year, four of whom are independent, advancing both the skill and experience profile of the Board as well as its diversity.

Chief Executive Officer Succession Planning

Our succession plan, which is reviewed annually by our Board, addresses both an unexpected loss of our CEO and longer-term succession.

Absence of Rights Plan

We do not have a shareholder rights plan, commonly referred to as a "poison pill."

Shareholder Special Meeting and Written Consent Rights

Shareholders hold the rights to call a special meeting and to act by written consent.

Prohibition on Short Sales, Hedging and Pledging Transactions in Company Securities

Our insider trading policy prohibits all directors, executive officers and employees from engaging in short sales and hedging transactions relating to our common stock. Additionally, our insider trading policy prohibits directors and executive officers from engaging in pledging transactions and discourages our employees from pledging transactions.

Stock Ownership Guidelines

All of our executive officers and directors were in compliance with our stock ownership guidelines as of April 9, 2021. Andrew Witty, our CEO, is required to own shares equal to eight times his base salary by the fifth anniversary of his appointment as CEO.

Stock Retention Policy

We generally require executive officers to hold, for at least one year, one-third of the net shares acquired upon vesting or exercise of any equity award. Our directors are generally required to hold all equity awards granted until completion of service on the Board, or until they have met our stock ownership requirements.

Political Contributions Disclosure

We publicly disclose our political contributions and public advocacy efforts and the contributions of our federal and state political action committees.

   

See the "Corporate Governance" portion of this proxy statement for further information on our governance practices.

2021 Proxy Statement    |    Proxy Summary    2


Table of Contents

COVID-19 Response

During 2020 and 2021, our Board has been actively engaged in overseeing UnitedHealth Group's response to the COVID-19 pandemic. While the pandemic continues to have a profound impact on the health of people around the world, we are committed to ensuring the safety and health of the people we serve, supporting our colleagues and their families, assisting communities and underserved populations, and ensuring the strength and reliability of the health care system. From the pandemic's outset, we took immediate and decisive action, including: accelerating philanthropic giving that benefits broader communities; providing needed liquidity for the health system and addressing financial imbalances resulting from the COVID-19 pandemic; and supporting public-private partnerships to advance COVID-19 research, testing, treatment, and vaccine distribution. Our ongoing efforts to fight the pandemic underscore the company's mission: helping people live healthier lives and helping make the health system work better for everyone.

A complete summary of the actions we have taken to respond to the pandemic can be found in Appendix A of this proxy statement.

Chief Executive Officer Succession

On February 3, 2021, Andrew Witty was appointed the Company's CEO, succeeding David Wichmann. Prior to his appointment as the Company's CEO, Mr. Witty was named President, UnitedHealth Group, in November 2019, in addition to his role as CEO of Optum, which he started in July 2018. Mr. Witty had also previously served as a member of the UnitedHealth Group Board of Directors from August 2017 until March 2018.

Since 2017, the Board had the opportunity to observe and evaluate Mr. Witty in many different settings, including Board and management meetings, investor presentations and individual discussions with directors.

The Board determined that Mr. Witty had the right vision, business and leadership skills, enterprise knowledge and support, broad health care experience and expertise in growth, innovation, technology, operations and global markets to be CEO.

Executive Compensation

Our executive compensation program uses a mix of base salary, annual cash incentives, equity awards and broad-based benefits to attract and retain highly qualified executives and maintain a strong relationship between executive pay and Company performance. Shareholders again expressed strong support for our executive compensation program at our 2020 Annual Meeting of Shareholders, with more than 95% of the votes cast in favor of our Say-on-Pay proposal.

Compensation Program Principles

Enhance the value of the business

 

Reward long-term growth and focus management on sustained success and shareholder value creation

 

Pay-for-performance

 

Standard benefits and limited perquisites

Information regarding compensation paid to each of our named executive officers in 2020 is described in the "Compensation Discussion and Analysis" section.

2021 Proxy Statement    |    Proxy Summary    3


Table of Contents

Strong Governance Standards for Executive Compensation

We maintain strong governance standards in the oversight of our executive compensation policies and practices, including:

    Performance-based compensation arrangements, including performance-based equity awards, which use a variety of performance measures, with different measures used for annual and long-term plans.

    Double trigger change in control arrangements for equity grants.

    No excise tax gross ups in the event of a change in control.

    Our 2020 Stock Incentive Plan continues the prohibition of the repricing of stock options and stock appreciation rights without shareholder approval.

    Annual advisory shareholder votes to approve the Company's executive compensation.

    Stock ownership guidelines requiring executive officers to beneficially own specified amounts of the Company's common stock within five years of their appointment as an executive officer.

    A stock retention policy generally requiring executive officers to hold, for at least one year, one third of the net shares acquired upon vesting or exercise of any equity award.

    A clawback policy entitling the Board of Directors to seek reimbursement from senior executives if they are involved in fraud or misconduct causing a material restatement or in the event of a senior executive's violation of non-compete, non-solicit or confidentiality provisions.

    Under the 2020 Stock Incentive Plan, equity-based compensation awards to employees are generally subject to four-year vesting provisions, with a one-year minimum vesting requirement, subject to an exception for a limited number of shares not to exceed 5%.

    Our Compensation and Human Resources Committee uses an independent compensation consultant who performs no other consulting or services for the Company.

    Tally sheets setting forth the current and historical compensation of each Section 16 officer are provided to the Compensation and Human Resources Committee at each quarterly meeting.

This proxy statement and our Annual Report for the year ended December 31, 2020, are first being mailed to the Company's shareholders and made available at www.unitedhealthgroup.com/proxymaterials on or about April 26, 2021. Website addresses included throughout this proxy statement are for reference only. The information contained on our website is not incorporated by reference into this proxy statement.

Voting Matters and Vote Recommendations

Items of Business Board's Recommendation Details

 


1


Election of nine directors


FOR


Page 5

 


2


Advisory Approval of Executive Compensation


FOR


Page 66

 


3


Ratification of Independent Registered Public Accounting Firm


FOR


Page 71

 


4


Approval of the UnitedHealth Group 1993 Employee Stock Purchase Plan Amendment


FOR


Page 72

 


5


Shareholder Proposal to Reduce the Share Ownership Threshold for Calling a Special Meeting of Shareholders


AGAINST


Page 77

2021 Proxy Statement    |    Proxy Summary    4


Table of Contents

  1

Board of
Directors


2

Corporate
Governance


3

Executive
Compensation


4

Audit

5

Annual
Meeting


6

Other
Information

Board of Directors

PROPOSAL 1: Election of Directors

Our Board of Directors has nominated nine directors for election at the 2021 Annual Meeting to hold office until the next annual meeting and the election of their successors. All of the nominees are currently directors. Each agreed to be named in this proxy statement and to serve if elected. All of the nominees are expected to attend the 2021 Annual Meeting. After 12 years of exceptional service as an independent director, Mr. Glenn M. Renwick is not standing for re-election at the 2021 Annual Meeting. All then-current directors attended the 2020 Annual Meeting.

Director Nomination Process

Criteria for Nomination to the Board

The Nominating and Corporate Governance Committee performs an assessment of the skills and experiences needed to oversee the interests of the Company. We believe an effective Board consists of a diverse group of individuals who bring a variety of complementary skills and a range of personal and business experience to their positions on the Board. The Nominating and Corporate Governance Committee developed and maintains a skills matrix to assist in considering the appropriate balance of experience, skills and attributes required of a director and to be represented on the Board as a whole. The skills matrix is consistent with the Company's long-term strategic plan and is regularly reviewed and updated by the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee evaluates Board candidates against the skills matrix on an annual basis to determine whether to recommend candidates for initial election to the Board and whether to recommend currently serving directors for reelection to the Board.

The skills matrix has two sections — a list of core criteria every member of the Board should meet and a list of skills and attributes to be represented collectively by the Board. The core director criteria are:

    Independence under the Company's Standards for Director Independence and New York Stock Exchange ("NYSE") listing requirements, subject to waiver by the Nominating and Corporate Governance Committee;

    Service on no more than three other public company boards; except our Chief Executive Officer may serve on no more than one other public company board;

    High integrity and ethical standards;

    Standing and reputation in the individual's field;

    Risk oversight ability with respect to the particular skills of the individual director;

    Understanding of and experience with complex public companies or like organizations; and

    Ability to work collegially and collaboratively with other directors and management.

2021 Proxy Statement    |    Proposal 1: Election of Directors    |    Director Nomination Process    5


Table of Contents

  1

Board of
Directors


2

Corporate
Governance


3

Executive
Compensation


4

Audit

5

Annual
Meeting


6

Other
Information

Each of our independent director nominees has satisfied all the core director criteria set forth in the skills matrix. Stephen Hemsley and Andrew Witty are not independent directors because Mr. Hemsley, until November 2019, served as an executive of the Company and Mr. Witty is our Chief Executive Officer.

Optimal mix of skills and expertise of director nominees

The skills matrix provides a number of substantive areas of expertise the Board as a whole should represent. The following table includes a list of these areas and the director nominees with expertise in each area.

Director
Corporate
Governance

Finance
Health Care
Industry

Direct
Consumer
Markets

Social
Media/
Marketing

Diversity
Experience
with Large
Complex
Organizations

Technology/
Business
Processes

Clinical
Practice

Political/
Health Care
Policy/
Regulatory

Capital
Markets


 


 


 


 


 


 


 


 


 


 


 


 
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Timothy P. Flynn


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Stephen J. Hemsley


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Michele J. Hooper


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F. William McNabb III


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Valerie C. Montgomery Rice, M.D.


 


 


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John H. Noseworthy, M.D.


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Gail R. Wilensky, Ph.D.


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Andrew Witty


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2021 Proxy Statement    |    Director Nomination Process    6


Table of Contents

  1

Board of
Directors


2

Corporate
Governance


3

Executive
Compensation


4

Audit

5

Annual
Meeting


6

Other
Information

Tenure of Director Nominees

Our Nominating and Corporate Governance Committee strives to maintain a balance of tenure on the Board. Long-serving directors bring valuable experience with our Company and familiarity with the successes and challenges the enterprise has faced over the years, while newer directors contribute fresh perspectives.

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Board Diversity

UnitedHealth Group embraces and encourages a culture of inclusion and diversity. Valuing diversity makes good business sense and helps to ensure our future success, because the customers, clients and consumers we serve are as diverse as the thousands of communities where we live and work across all 50 states in the U.S. and 150 other countries.

Our Board does not establish specific goals with respect to diversity, the Board's diversity is a consideration in the director nomination process and is assessed annually when the Board evaluates overall effectiveness. We are committed to actively seeking women and racially/ethnically diverse director candidates. The Nominating and Corporate Governance Committee maintains an active recruiting pipeline of potential director candidates based upon skills identified in our skills matrix and includes diverse candidates.

Recent Changes in Board Membership

Additions   Departures
2021
2019
2018
2017   2021
2020
2018
2017
Andrew
Witty(1)

John H.
Noseworthy, M.D.

F. William
McNabb III

Timothy P.
Flynn

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  David S.
Wichmann

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William C.
Ballard, Jr.

Andrew
Witty

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Rodger A.
Lawson

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Valerie C.
Montgomery
Rice, M.D.

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Andrew
Witty

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David S.
Wichmann



 


Glenn M.
Renwick

(Not Standing for
Re-election at
the Annual
Meeting)













Kenneth I.
Shine, M.D.





Robert J.
Darretta
(1)
Andrew Witty first joined the Board as an independent director in August 2017, stepped down in March 2018 to serve as CEO of Optum and rejoined the Board in connection with his appointment as the Company's CEO in February 2021.

2021 Proxy Statement    |    Director Nomination Process    7


Table of Contents

  1

Board of
Directors


2

Corporate
Governance


3

Executive
Compensation


4

Audit

5

Annual
Meeting


6

Other
Information

For this year's election, the Board has nominated nine individuals. All are incumbent nominees who collectively bring tremendous diversity to the Board, including diversity in terms of professional experience, skills and background, as well as diversity of nationality, race and gender. Each nominee is a strategic thinker and has varying, specialized experience in the areas relevant to the Company and its businesses. Moreover, their collective experience covers a wide range of geographies and industries, including health care and clinical practice, insurance, consumer products, technology, capital markets and financial services, and roles in academia, corporate governance, government and intergovernmental organizations. The nine director nominees range in age from 56 to 77; three of the nine director nominees are women; two are African American; one is a citizen of the U.K. and one is a citizen of Canada.

Search Process for New Directors

The Nominating and Corporate Governance Committee screens and recommends candidates for nomination by the full Board. We have for several years maintained an active "evergreen" director candidate pipeline which reflects our continuing commitment to diversity in life, cultural and business experience among director nominees. The Nominating and Corporate Governance Committee has an outside firm on retainer to assist in identifying and evaluating director candidates. The Nominating and Corporate Governance Committee will also consider recommendations submitted by shareholders for director candidates. Recommendations should be directed to the Secretary to the Board of Directors. None of the Company's shareholders recommended candidates for the Board of Directors in connection with the 2021 Annual Meeting.

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Prior to the appointment of each of the new independent directors beginning in 2017, the Nominating and Corporate Governance Committee considered a wide slate of potential candidates, including qualified women and racially/ethnically diverse candidates. Each eventual nominee was selected due to his or her overall skills and experience.

Shareholder Director Candidates for Inclusion in our Proxy Statement (Proxy Access)

Our Bylaws provide a shareholder or group of shareholders (of up to 20) who have owned at least 3% of our common stock for at least three years the ability to include in our proxy statement shareholder-nominated director

2021 Proxy Statement    |    Director Nomination Process    8


Table of Contents

  1

Board of
Directors


2

Corporate
Governance


3

Executive
Compensation


4

Audit

5

Annual
Meeting


6

Other
Information

candidates for up to 20% of the Board. To be eligible to use this right, the shareholder(s) and the candidate(s) must satisfy the requirements specified in our Bylaws. Our Bylaws are available at www.unitedhealthgroup.com/who-we-are/corporate-governance. For the 2022 Annual Meeting, director nominations submitted under these Bylaw provisions must be received at our principal executive offices, directed to the Secretary to the Board of Directors, no earlier than November 24, 2021 and no later than December 24, 2021.

Shareholder Nominations of Director Candidates at an Annual Meeting

Our shareholders may also nominate candidates for election to the Board of Directors from the floor of our Annual Meeting of Shareholders, instead of including the director candidate in our proxy statement, by submitting timely written notice to the Secretary to the Board in accordance with our Bylaws. The notice must include the information required by our Bylaws, which are available at www.unitedhealthgroup.com/who-we-are/corporate-governance. For the 2022 Annual Meeting, this notice must be received at our principal executive offices, directed to the Secretary to the Board of Directors, no earlier than February 7, 2022 and no later than March 9, 2022.

Board Leadership Structure

Our Board of Directors believes having independent Board leadership is an important component of our governance structure. As such, our Bylaws require the Company to have either an independent Chair of the Board or a Lead Independent Director. Our Board's leadership structure also separates the positions of CEO and Chair of the Board. The Board believes this separation is appropriate for the Company at this time because it allows for a division of responsibilities and a sharing of ideas between individuals having different perspectives. The Board will continue to evaluate the Board structure on an ongoing basis.

Our Principles of Governance outline the specific duties of the Lead Independent Director, including:

    serving as the principal liaison between the independent directors and the Chair of the Board;

    presiding at all meetings of the Board at which the Chair of the Board is not present and at executive sessions of the Board's independent directors;

    calling meetings of the independent directors as appropriate and, in coordination with the Chair of the Board, all members of the Board;

    facilitating discussion and open dialogue among the independent directors during Board meetings, executive sessions and outside of Board meetings;

    serving as an ex officio member of each Board committee of which the Lead Independent Director is not a member and working with the Board committee chairs on the performance of their designated roles and responsibilities;

    working with the Chair of the Board to approve the agendas and meeting schedules for Board meetings;

    working with the Chair of the Board on the appropriateness (including quality and quantity) and timeliness of information provided to the Board;

2021 Proxy Statement    |    Board Leadership Structure    9


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Other
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    meeting individually with the Chair of the Board after each regularly scheduled Board meeting; coordinating the preparation of agendas and materials for executive sessions of the Board's Independent Directors, if any;

    assisting the Chair of the Nominating and Corporate Governance Committee in reviewing and reporting on the results of the Board and committee performance self-evaluations;

    communicating to the Chair of the Board any decisions reached, suggestions, views or concerns expressed by Independent Directors in executive sessions or outside of Board meetings;

    meeting periodically with individual independent directors to discuss Board and committee performance, effectiveness and composition;

    where appropriate, supporting the Company in interactions with shareholders and regulators in consultation with the Chief Executive Officer and Chair of the Board; and

    interviewing, along with the Chair of the Nominating and Corporate Governance Committee, all Board candidates and making director candidate recommendations to the Nominating and Corporate Governance Committee.

Director Independence

Our Board of Directors has adopted the Company's Standards for Director Independence, which are available at www.unitedhealthgroup.com/who-we-are/corporate-governance. The Standards for Director Independence requirements exceed the independence standards set by the NYSE.

Our Board of Directors has determined Richard T. Burke, Timothy P. Flynn, Michele J. Hooper, F. William McNabb III, Valerie C. Montgomery Rice, M.D., John H. Noseworthy, M.D., Glenn M. Renwick and Gail R. Wilensky, Ph.D. are each "independent" under the NYSE rules and the Company's Standards for Director Independence, and have no material relationships with the Company that would prevent the directors from being considered independent. Stephen Hemsley, Chair of the Board, and Andrew Witty, CEO, are not independent directors.

In determining independence, the Board of Directors considered, among other factors, the business relationships between the Company and our directors and nominees, their immediate family members (as defined by the NYSE) and their affiliated companies. The Board of Directors considered whether any director or any nominee was a director, partner, significant shareholder or executive officer of an organization that has a relationship with the Company, and also considered charitable contributions the Company or its affiliates made to organizations with which such directors or nominees are or have been associated. In particular, the Board of Directors evaluated the following relationships and determined such relationships were in the normal course of business and did not impair the directors' ability to exercise independent judgment:

    Mr. Burke is an owner of Rainy Partners, LLC. Rainy Partners is a customer of the Company and paid the Company premiums for health insurance of approximately $371,800 in 2020. These premiums were determined on the same terms and conditions as premiums for other comparable customers.

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    Dr. Montgomery Rice is President and Dean of Morehouse School of Medicine. In 2020, Morehouse School of Medicine paid the Company approximately $351,500 for claims software and medical records review services. The Company paid Morehouse School of Medicine approximately $710,000 for services as a network care provider and approximately $179,800 for a study focused on COVID-19 infection severity by sickle cell trait status in 2020. UnitedHealth Group and the United Health Foundation donated approximately $361,500 in charitable contributions to Morehouse School of Medicine in 2020. Total amounts paid by the Company and the United Health Foundation to Morehouse School of Medicine during 2020 were substantially less than 1% of Morehouse School of Medicine's total revenues for 2020. Dr. Montgomery Rice was not directly involved in these relationships.

    The Board of Directors also considered relationships between the Company and organizations on which our non-employee directors or their immediate family members serve only as directors and determined none of these relationships impair the directors' exercise of independent judgment.

Board Committees

The Board of Directors has established four standing committees as listed in the table below. These committees help the Board fulfill its responsibilities and assist the Board in making informed decisions. Each committee operates under a written charter, and evaluates its charter and conducts a committee performance evaluation annually.

The following table identifies the members of each committee as of April 9, 2021:

Director Audit Compensation
and Human
Resources


Nominating and
Corporate
Governance


Public Policy
Strategies and
Responsibility
Richard T. Burke*     GRAPHIC  
Timothy P. Flynn   GRAPHIC    
Stephen J. Hemsley        
Michele J. Hooper GRAPHIC   GRAPHIC   GRAPHIC  
F. William McNabb III GRAPHIC   GRAPHIC   GRAPHIC  
Valerie C. Montgomery Rice, M.D.       GRAPHIC
John H. Noseworthy, M.D.   GRAPHIC   GRAPHIC
Glenn M. Renwick** GRAPHIC
 
GRAPHIC
     
Gail R. Wilensky, Ph.D.   GRAPHIC   GRAPHIC
Andrew Witty        

GRAPHIC  Chair     GRAPHIC  Member     GRAPHIC  Financial Expert

*
Mr. Burke is the Lead Independent Director and an ex-officio member of the Audit Committee, Compensation and Human Resources Committee and Public Policy Strategies and Responsibility Committee. As an ex-officio member, Mr. Burke has a standing invitation to attend each committee meeting, but does not count for quorum purposes or vote on committee matters.

**
After 12 years of exceptional service, Mr. Renwick is not standing for re-election at the 2021 Annual Meeting.

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  Audit Committee Meetings Held in 2020: 10  

 


Committee Members:


 

 


Glenn M. Renwick (Chair), Michele J. Hooper and F. William McNabb III


 

 


Primary Responsibilities:


 

 


The Audit Committee has responsibility for the selection and retention of the independent registered public accounting firm and oversees financial reporting, internal controls and public disclosure. The Audit Committee reviews and assesses the effectiveness of the Company's policies, procedures and resource commitments in the areas of compliance, ethics, privacy and cyber security, by interacting with personnel responsible for these functions. The Audit Committee also oversees management's processes to identify and quantify material risks facing the Company. The Audit Committee establishes procedures concerning the receipt, retention and treatment of complaints regarding accounting, internal accounting controls and auditing matters. The Audit Committee operates as a direct line of communication between the Board of Directors and our independent registered public accounting firm, as well as our internal audit, compliance and legal personnel.


 

 


Independence:


 

 


Each of the Audit Committee members is an independent director under the NYSE listing standards and the SEC rules. The Board of Directors has determined Messrs. Renwick and McNabb and Ms. Hooper are "audit committee financial experts" as defined by the SEC rules. After 12 years of exceptional service, Mr. Renwick is not standing for re-election at the Annual Meeting. He will continue to serve as Chair of the Audit Committee until the Annual Meeting. The Board will appoint a new independent Chair of the Audit Committee at its meeting held in connection with the Annual Meeting.


 

 


 


 


 

 

  Compensation and Human Resources Committee Meetings Held in 2020: 6  

 


Committee Members:


 

 


Timothy P. Flynn (Chair), John H. Noseworthy, M.D. and Gail R. Wilensky, Ph.D.


 

 


Primary Responsibilities:


 

 


The Compensation and Human Resources Committee is responsible for overseeing (i) our policies and practices related to total compensation for executive officers, (ii) the administration of our incentive and equity-based plans, (iii) the risk associated with our compensation practices and plans, and (iv) human capital management, including inclusion and diversity initiatives. The Compensation and Human Resources Committee also establishes employment arrangements with our CEO and other executive officers, conducts an annual performance review of the CEO, and reviews and monitors director compensation programs and the Company's stock ownership guidelines.


 

 


Independence:


 

 


Each of the Compensation and Human Resources Committee members is an independent director under the NYSE listing standards and the SEC rules, and a non-employee director under the SEC rules.


 

 


 


 


 

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  Nominating and Corporate Governance Committee Meetings Held in 2020: 3  

 


Committee Members:


 

 


Michele J. Hooper (Chair), Richard T. Burke and F. William McNabb III


 

 


Primary Responsibilities:


 

 


The Nominating and Corporate Governance Committee's duties include (i) identifying and nominating individuals to be proposed as nominees for election as directors at each annual meeting of shareholders or to fill Board vacancies, (ii) conducting the Board evaluation process, (iii) evaluating the categorical standards which the Board of Directors uses to determine director independence, and (iv) monitoring and evaluating corporate governance practices. The Nominating and Corporate Governance Committee also oversees Board processes and corporate governance-related risk.


 

 


Independence:


 

 


Each of the Nominating and Corporate Governance Committee members is an independent director under the NYSE listing standards.


 

 


 


 


 

 

  Public Policy Strategies and Responsibility Committee Meetings Held in 2020: 4  

 


Committee Members:


 

 


Gail R. Wilensky, Ph.D. (Chair), Valerie C. Montgomery Rice, M.D. and John H. Noseworthy, M.D.


 

 


Primary Responsibilities:


 

 


The Public Policy Strategies and Responsibility Committee is responsible for assisting the Board of Directors in fulfilling its responsibilities relating to (i) the Company's public policy, health care reform and modernization activities, (ii) political contributions, government relations, community and charitable activities, and (iii) sustainability performance, including responsible social and environmental practices. The Public Policy Strategies and Responsibility Committee is also responsible for overseeing the risks associated with these activities.


 

 


Independence:


 

 


Each of the Public Policy Strategies and Responsibility Committee members is an independent director under the NYSE listing standards.


 

 


 


 


 

Board Meetings and Annual Meeting Attendance

Directors are required to attend at least 75% of Board meetings, meetings of committees on which they serve and the Annual Meeting of Shareholders. All of the nominees are expected to attend the 2021 Annual Meeting. During the year ended December 31, 2020, the Board of Directors held eleven meetings. All current directors attended at least 75% of the meetings of the Board and any Board committees of which they were members in 2020.

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Board and Committee Evaluations

The Nominating and Corporate Governance Committee oversees the Board and Committee evaluation process. In addition, the Chair of the Board and the Lead Independent Director meet regularly with individual directors to discuss Board and Committee performance, effectiveness and composition.

GRAPHIC

As part of director feedback received through the annual evaluation process, the Board continues to place a focus on engaging with management on achievement of the Company's long-term strategies, leadership development and inclusion and diversity topics. In addition, the Nominating and Governance Committee receives information regarding the skills and qualifications current Board or committee members believe future Board or committee members should possess.

Communication with the Board of Directors

The Board of Directors values the input and insights of our shareholders and other interested parties and believes effective communication strengthens the Board's role as an active, informed and engaged fiduciary. The Board has adopted a Board of Directors Communication Policy to facilitate communication between shareholders and other interested parties and the Board. Under this policy, the Board has designated the Company's Secretary to the Board of Directors as its agent to receive and review communications. The Secretary to the Board will not forward to the directors communications received which are of a personal nature or not related to the duties and responsibilities of the Board, including, without limitation, mass mailings, business solicitations, routine customer service complaints, new product or service suggestions and opinion surveys.

Appropriate matters to raise in communications to the Board include Board composition; Board and CEO succession planning process; executive compensation; uses of capital; and general Board oversight, including corporate governance, accounting, internal controls, auditing and other related matters.

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The policy, including information on how to contact the Board of Directors, may be found in the corporate governance section of our website, www.unitedhealthgroup.com/who-we-are/corporate-governance.

2021 Director Nominees

Our Certificate of Incorporation provides that each member of our Board of Directors is elected annually by a majority of votes cast if the election is uncontested. The Board of Directors has nominated the nine directors set forth as follows for election by the shareholders at the 2021 Annual Meeting. All director nominees except Andrew Witty, who became a director on February 3, 2021, were elected by our shareholders at the 2020 Annual Meeting. If any nominees should become unable to serve as a director for any reason, the persons named below as proxies will elect a replacement.

Following is a brief biographical description of each director nominee. A table listing the areas of expertise in the skills matrix held by each director and which, in part, led the Board to conclude each respective director should continue to serve as a member of the Board, is included on page 6.

The Board of Directors recommends you vote FOR the election of each of the nominees. Executed proxies will be voted FOR the election of each nominee unless you specify otherwise.

 

Director
Age
Primary Occupation
Director Since
Richard T. Burke 77 Lead Independent Director, UnitedHealth Group 1977
Timothy P. Flynn 64 Former Chair, KPMG International 2017
Stephen J. Hemsley 68 Chair, UnitedHealth Group 2000
Michele J. Hooper 69 President and CEO, The Directors' Council 2007
F. William McNabb III 64 Former Chairman and CEO, The Vanguard Group, Inc. 2018
Valerie C. Montgomery Rice, M.D. 59 President and Dean, Morehouse School of Medicine 2017
John H. Noseworthy, M.D. 69 Former CEO and President, Mayo Clinic 2019
Gail R. Wilensky, Ph.D. 77 Senior Fellow, Project Hope and Former Administrator of CMS 1993
Andrew Witty 56 CEO, UnitedHealth Group 2021

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Richard T. Burke

Mr. Burke is Lead Independent Director of the Board of Directors of UnitedHealth Group and has served in this capacity since September 2017. Mr. Burke served as Chair of the Board from 2006 to August 2017, has been a member of our Board since 1977, and was Chief Executive Officer of UnitedHealthcare, Inc., our predecessor corporation, until 1988. In 2020, Mr. Burke became Chief Executive Officer and Chair of Senior Connect Acquisition Corp., a company formed and funded to acquire, by merger or other form of business combination, one or more businesses that provide services to older adults. From 1995 until 2001, Mr. Burke was the owner, Chief Executive Officer and Governor of the Phoenix Coyotes, a National Hockey League team. In the past five years, Mr. Burke served as a director of Meritage Homes Corporation.


  Director since: 1977

  
Age: 77

  
Committees:
       Nominating and Corporate
            Governance

  
Current Outside Public
  
Directorships:
       Senior Connect Acquisitions Corp.

 

Timothy P. Flynn

Mr. Flynn was Chairman of KPMG International ("KPMG"), a global professional services organization that provides audit, tax and advisory services, from 2007 until his retirement in October 2011. From 2005 until 2010, he served as Chairman and from 2005 to 2008 as CEO of KPMG LLP in the U.S., the largest individual member firm of KPMG. Prior to serving as Chairman and CEO of KPMG LLP, Mr. Flynn was Vice Chairman, Audit and Risk Advisory Services, with operating responsibility for Audit, Risk Advisory and Financial Advisory Services practices. He previously served as a trustee of the Financial Accounting Standards Board, a member of the World Economic Forum's International Business Council, and a director of the International Integrated Reporting Council.


  Director since: 2017

  
Age: 64

  
Committees:
       Compensation and Human
            Resources (Chair)

  
Current Outside Public
  
Directorships:
       Alcoa Corporation
       JPMorgan Chase & Co.
       Walmart Inc.

 

Stephen J. Hemsley

Mr. Hemsley is Chair of the Board of UnitedHealth Group and has served in this capacity since November 2019. Mr. Hemsley previously served as Executive Chair of the Board from September 2017 to November 2019, Chief Executive Officer from November 2006 to August 2017, President from May 1999 to November 2014, and Chief Operating Officer from November 1998 to November 2006. He joined the Company in 1997 and has been a member of the Board of Directors since 2000. Mr. Hemsley currently serves as a director of Cargill, Inc.


  Director since: 2000

  
Age: 68

  
Committees:
       None

  
Current Outside Public
  
Directorships:
       None

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Other
Information

 

Michele J. Hooper

Ms. Hooper is President and CEO of The Directors' Council, a private company she co-founded in 2003 that works with corporate boards to increase their independence, effectiveness and diversity. She was President and CEO of Voyager Expanded Learning, a developer and provider of learning programs and teacher training for public schools, from 1999 until 2000. She previously served as President and CEO of Stadtlander Drug Company, Inc., a provider of disease specific pharmaceutical care, from 1998 until Stadtlander was acquired in 1999. Ms. Hooper is a nationally recognized corporate governance expert. In the past five years, Ms. Hooper also served as a director of PPG Industries,  Inc.


  Director since: 2007

  
Age: 69

  
Committees:
       Nominating and Corporate
            Governance (Chair)
       Audit

  
Current Outside Public
  
Directorships:
       United Airlines Holdings, Inc.

 

F. William McNabb III

Mr. McNabb served as Chairman of The Vanguard Group, Inc. from 2010 until his retirement in 2018 and served as CEO from 2008 to 2017. He joined Vanguard in 1986. In 2010, he became Chairman of the Board of Directors and the Board of Trustees of the Vanguard group of investment companies. Earlier in his career, Mr. McNabb led each of Vanguard's client facing business divisions. Mr. McNabb is active in the investment management industry and served as the Chairman of the Investment Company Institute's Board of Governors from 2013 to 2016. Mr. McNabb is Chairman of the Board of the Zoological Society of Philadelphia and serves on the Wharton Leadership Advisory Board, the Dartmouth Athletic Advisory Board, Columbia Law School's Millstein Center Advisory Board and the Ernst & Young Independent Audit Quality Board. Mr. McNabb is a board member of CECP: The CEO Force for Good.


  Director since: 2018

  
Age: 64

  
Committees:
       Audit
       Nominating and Corporate
            Governance

  
Current Outside Public
  
Directorships:
       International Business
            Machines Corporation

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Information

 

Valerie C. Montgomery Rice, M.D.

Dr. Montgomery Rice is President and Dean of the Morehouse School of Medicine, a medical school in Atlanta, Georgia, and has served in this capacity since 2014. She also served as the Executive Vice President and Dean of the Morehouse School of medicine from 2011 to 2014. Morehouse School of Medicine is among the nation's leading educators of primary care physicians and was recently recognized as the top institution among U.S. medical schools for their social mission. Prior to joining Morehouse School of Medicine, she served as dean of the School of Medicine and Senior Vice President of Health Affairs at Meharry Medical College from March 2006 to June 2009, and as director of the Center for Women's Health Research, one of the nation's first research centers devoted to studying diseases that disproportionately impact women of color, from 2005 to 2011. Dr. Montgomery Rice also served previously as a Council Member of the National Institute of Health and National Center for Advancing Translational Science, and previously on the National Institute of Health's Minority Health and Health Disparities and Office of Research on Women's Health advisory councils, and the Association of American Medical Colleges Council of Deans administrative board. Dr. Montgomery Rice is a member of the National Academy of Medicine and a renowned infertility specialist and women's health researcher.


  Director since: 2017

  
Age: 59

  
Committees:
       Public Policy Strategies and
            Responsibility

  
Current Outside Public
  
Directorships:
       None

 

John H. Noseworthy, M.D.

Dr. Noseworthy is the former Chief Executive Officer and President of Mayo Clinic, a world renowned non-profit healthcare organization. He retired at the end of 2018 after a 28 year career at Mayo Clinic, recognized by U.S. News and World Report as best in its honor roll of America's top providers of care for patients with serious and complex problems. Mayo Clinic cares for patients from every state and 143 countries worldwide. Dr. Noseworthy joined Mayo Clinic in 1990 and served in various capacities, including as Chairman of Mayo Clinic's internal Board of Governors, member of the Board of Trustees, Professor of Neurology at Mayo Clinic College of Medicine & Science, Chair of Mayo's Department of Neurology, medical director of the Department of Development and Vice Chair of the Mayo Clinic Rochester Executive Board. Dr. Noseworthy also served as editor-in-chief of Neurology, the official journal of the American Academy of Neurology, from 2007 to 2009. Dr. Noseworthy was a Health Governor of the World Economic Forum from 2012 to 2018 and, in the past five years, also served as a director of Merck & Co.


  Director since: 2019

  
Age: 69

  
Committees:
       Compensation and Human
            Resources Committee
       Public Policy Strategies and
            Responsibility

  
Current Outside Public
  
Directorships:
       None

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Gail R. Wilensky, Ph.D.

Dr. Wilensky has been a senior fellow at Project HOPE, an international health foundation, since 1993. From 2008 to 2009, Dr. Wilensky was President of the Department of Defense Health Board and chaired its sub-committee on health care delivery. From 2006 to 2008, Dr. Wilensky co-chaired the Department of Defense Task Force on the Future of Military Health Care. During 2007, she also served as a commissioner on the President's Commission on Care for America's Returning Wounded Warriors. From 2001 to 2003, she was the Co-Chair of the President's Task Force to Improve Health Care for our Nation's Veterans. From 1997 to 2001, she was also Chair of the Medicare Payment Advisory Commission. From 1992 to 1993, Dr. Wilensky served as the Deputy Assistant to President George H. W. Bush for policy development, and from 1990 to 1992, she was the Administrator of the Health Care Financing Administration (now known as the Centers for Medicare and Medicaid Services), directing the Medicaid and Medicare programs for the United States. Dr. Wilensky is a nationally recognized health care economist.


  Director since: 1993

  
Age: 77

  
Committees:
       Public Policy Strategies and
            Responsibility (Chair)
       Compensation and Human
            Resources

  
Current Outside Public
  
Directorships:
       Quest Diagnostics
       ViewRay, Inc.

 

Andrew Witty

Mr. Witty is Chief Executive Officer of UnitedHealth Group and has served in that capacity since February 2021. He was President of UnitedHealth Group from November 2019 to February 2021, Chief Executive Officer of Optum from July 2018 to April 2021, and a UnitedHealth Group director from August 2017 to March 2018. From April 2020 to November 2020, Mr. Witty took an unpaid leave of absence from his positions at UnitedHealth Group and Optum to serve as a Global Envoy for the World Health Organization's COVID-19 efforts. Since March 2021, Mr. Witty has served as an expert lead and member of the steering group of the pandemic preparedness partnership to advise the UK's G7 Presidency. Prior to joining UnitedHealth Group, he was Chief Executive Officer and a board member of GlaxoSmithKline, a global pharmaceutical company, from 2008 to April 2017.


  Director since: 2021

  
Age: 56

  
Committees:
       None

  
Current Outside Public
  
Directorships:
       None

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Director Compensation

We seek to compensate our non-employee directors fairly for work required for a company of our size, complexity and scope and to align their interests with the long-term interests of our shareholders. Director compensation reflects our desire to attract, retain and benefit from the expertise of highly qualified people with backgrounds and experience relevant to our business and those we serve. The Compensation and Human Resources Committee annually reviews the compensation of our non-employee directors and makes recommendations to the Board of Directors. In August 2020, the Compensation and Human Resources Committee, with the advice of its independent compensation consultant, undertook a review of the structure, philosophy and overall mix of the director compensation program as compared to the Company's compensation peer group and also the four large publicly traded managed care and health care and services companies included in the peer group. Following this review, the Compensation and Human Resources Committee recommended, and the Board approved, a decrease in the annual cash retainer for the Chair of the Board to align the Chair's compensation with the approximate market median, effective September 1, 2020. No other changes were made to the compensation of the non-employee directors.

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

Compensation Element

Compensation Value ($)


 


 

Annual Cash Retainer

125,000

Annual Chair of the Board Cash Retainer

220,000

Annual Audit Committee Chair Cash Retainer

25,000

Annual Compensation and Human Resources Committee Chair Cash Retainer

20,000

Annual Nominating and Corporate Governance Committee Chair Cash Retainer

20,000

Annual Public Policy Strategies and Responsibility Committee Chair Cash Retainer

20,000

Annual Lead Independent Director Cash Retainer

75,000

Annual Equity Award

205,000 aggregate fair value of deferred stock units

Equity Conversion Program

At the director's election, cash compensation may be converted into DSUs, or if the director has met the stock ownership guidelines, into common stock

Cash Compensation

Cash retainers are payable on a quarterly basis in arrears on the first business day following the end of each fiscal quarter and are subject to pro rata adjustment if the director did not serve the entire quarter. Directors may elect to receive deferred stock units ("DSUs") or common stock (if the director has met the stock ownership guidelines) in lieu of their cash compensation or may defer receipt of their cash compensation to a later date pursuant to the

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Directors' Compensation Deferral Plan ("Director Deferral Plan"). The cash retainers are in consideration of general service and responsibilities and required meeting preparation. Effective September 1, 2020, the Board approved the reduction of the annual cash retainer for the non-executive Chair of the Board role from $270,000 to $220,000.

Equity-Based Compensation

Non-employee directors receive annual grants of DSUs under the 2020 Stock Incentive Plan having an aggregate fair value of $205,000. The grants are issued quarterly in arrears on the first business day following the end of each fiscal quarter and prorated if the director did not serve the entire quarter. The number of DSUs granted is determined by dividing $51,250 (the quarterly value of the annual equity award) by the closing price of our common stock on the grant date, rounded up to the nearest share. The grants are in consideration of general service and responsibilities and required meeting preparation and serve to align the interests of our directors with those of our shareholders.

The DSUs immediately vest upon grant and must be retained until completion of the director's service on the Board. Upon completion of service, the DSUs convert into an equal number of shares of the Company's common stock. A director may defer receipt of the shares for up to ten years after completion of service pursuant to the Director Deferral Plan. Non-employee directors who have met their stock ownership requirement may elect to receive common stock in lieu of DSUs and/or in-service distributions on pre-selected dates.

If a director elects to convert his or her cash compensation into common stock or DSUs, such conversion grants are made on the day the eligible cash compensation becomes payable to the director. The director receives the number of shares of common stock or DSUs, as applicable, equal to the cash compensation foregone, divided by the closing price of our common stock on the date of grant, rounded up to the nearest share. The DSUs immediately vest upon grant. A director may only elect to receive common stock if he or she has met the stock ownership guidelines.

The Company pays dividend equivalents in the form of additional DSUs on all outstanding DSUs. Dividend equivalents are paid at the same rate and at the same time that dividends are paid to Company shareholders and are subject to the same vesting conditions as the underlying grant.

Stock Ownership and Retention Guidelines

Under our stock ownership guidelines, we require non-employee directors to achieve ownership of shares of the Company's common stock (excluding stock options, but including vested DSUs and vested restricted stock units) having a fair market value equal to five times the directors' annual base cash retainer. Non-employee directors must comply with the stock ownership guidelines within five years of their appointment to the Board of Directors. All of our non-employee directors have met the stock ownership requirement or have served as a director for less than five years. Our directors are required to hold all equity awards granted until completion of service on the Board or until they have met our stock ownership requirements.

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Director Deferral Plan

Under the Director Deferral Plan, subject to compliance with applicable laws, non-employee directors may elect annually to defer receipt of all or a percentage of their compensation. Amounts deferred are credited to a bookkeeping account maintained for each director participant that uses a predetermined collection of unaffiliated mutual funds as measuring investments. The Director Deferral Plan does not provide for matching contributions by the Company.

Other Compensation

We reimburse directors for any reasonable out-of-pocket expenses incurred in connection with service as a director. We also provide health care coverage to directors if the director is not eligible for subsidized coverage under another group health care benefit program. Health care coverage is provided generally on the same terms and conditions as current employees. Upon retirement from the Board of Directors, directors may continue to obtain health care coverage under benefit continuation coverage, and after the lapse of such coverage, under the Company's post-employment medical plan for up to a total of 96 months if they are otherwise eligible.

The Company maintains a program through which it will match up to $15,000 of charitable donations made by each director for each calendar year. The directors do not receive any financial benefit from this program because the charitable income tax deductions accrue solely to the Company. Donations under the program may not be made to family trusts, partnerships or similar organizations.

Our corporate aircraft use policy prohibits personal use of corporate aircraft by any independent director. However, because there is no incremental cost to the Company, the policy permits a director's family member to on occasion accompany the director on a business flight on Company aircraft provided a seat is available.

The following table provides information for the year ended December 31, 2020, relating to compensation paid to or accrued by us on behalf of our non-employee directors who served in this capacity during 2020.

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2020 Director Compensation Table

Name(1)
Fees Earned or Paid
In Cash
($)(2)

Stock
Awards
($)(3)

All Other
Compensation
($)(4)

Total
($)

William C. Ballard, Jr.

94,507 137,873 11,778 244,158

Richard T. Burke

200,000 205,592 27,042 432,634

Timothy P. Flynn

339,962 22,331 362,293

Stephen J. Hemsley

534,818 22,977 557,795

Michele J. Hooper

145,000 205,592 15,361 365,953

F. William McNabb III

330,784 330,784

Valerie C. Montgomery Rice, M.D.

78,125 252,390 18,543 349,058

John H. Noseworthy, M.D.

330,784 15,000 345,784

Glenn M. Renwick

355,611 23,037 378,648

Gail R. Wilensky, Ph.D.

145,000 205,592 15,000 365,592
(1)
Mr. Ballard did not stand for re-election at the 2020 Annual Meeting of Shareholders and ceased serving as a member of the Board of Directors on June 1, 2020. Mr. Renwick is not standing for re-election at the 2021 Annual Meeting.

(2)
Directors converted some or all of cash compensation payable to such director into DSUs as follows:

 

Name
Amount of
Cash
($)
Deferred Stock
Units
(#)

Timothy P. Flynn

134,286 474

Stephen J. Hemsley

350,171 1,248

F. William McNabb III

125,000 443

Valerie C. Montgomery Rice, M.D.

46,875 168

John H. Noseworthy, M.D.

125,000 443

Glenn M. Renwick

150,000 532
(3)
The amounts reported reflect the aggregate grant date fair value of the stock awards granted in 2020 computed in accordance with FASB ASC Topic 718, based on the closing price of our common stock on the grant date. For a description of the assumptions used in computing the aggregate grant date fair value, see Note 11 to the Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2020. For each director, the amounts reported include the aggregate grant date fair value of the annual equity award of DSUs granted in quarterly installments. The amounts reflect the value of fractional shares issued with the quarterly installments as we round equity grants up to the nearest whole share. We combine the cash compensation directors elect to convert into DSUs on a quarterly basis and the value of the quarterly DSU grant prior to determining the number of DSUs to be granted each quarter. For 2020, Dr. Wilensky elected for a portion of her annual DSU awards be granted in shares of common stock.

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    The aggregate grant date fair values of the stock awards granted in 2020, computed in accordance with FASB ASC Topic 718 based on the closing price of our common stock on the grant date, are as follows:

Name
January 2, 2020
($)
April 1, 2020
($)
July 1, 2020
($)
October 1, 2020
($)

William C. Ballard, Jr.

51,480 51,261 35,132

Richard T. Burke

51,480 51,261 51,507 51,343

Timothy P. Flynn*

82,778 82,587 86,937 87,660

Stephen J. Hemsley*

88,335 150,224 150,056 146,204

Michele J. Hooper

51,480 51,261 51,507 51,343

F. William McNabb III*

82,778 82,587 82,769 82,650

Valerie C. Montgomery Rice, M.D.*

51,480 66,924 66,989 66,997

John H. Noseworthy, M.D.*

82,778 82,587 82,769 82,650

Glenn M. Renwick*

88,920 88,758 89,021 88,912

Gail R. Wilensky, Ph.D.

51,480 51,261 51,507 51,343
*
Includes the value of DSUs issued upon conversion of annual cash retainers as described in footnote 2 above of $134,286 for Mr. Flynn, $350,171 for Mr. Hemsley, $125,000 for each of Mr. McNabb and Dr. Noseworthy, $46,875 for Dr. Montgomery Rice and $150,000 for Mr. Renwick.

    As of December 31, 2020, our non-employee directors held outstanding DSU awards as follows:

Name
Deferred
Stock Units

William C. Ballard, Jr.

9,301

Richard T. Burke

25,611

Timothy P. Flynn

5,221

Stephen J. Hemsley

1,927

Michele J. Hooper

32,505

F. William McNabb III

3,421

Valerie C. Montgomery Rice, M.D.

2,722

John H. Noseworthy, M.D.

2,111

Glenn M. Renwick

48,499

Gail R. Wilensky, Ph.D.

22,974
(4)
In 2020, the Company matched charitable contributions made by the following directors to charitable organizations selected by the directors pursuant to the Company's Board Matching Program: $15,000 for Messrs. Burke, Flynn, Hemsley and Renwick and Drs. Montgomery Rice, Noseworthy and Wilensky; $14,856 for Ms. Hooper; and $7,500 for Mr. Ballard. In 2020, the Company also paid $252, $12,042, $7,331, $7,977, $8,037 and $505 in health care premiums on behalf of Messrs. Ballard, Burke, Flynn, Hemsley, Renwick and Ms. Hooper, respectively.

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Corporate Governance

Overview

UnitedHealth Group is committed to high standards of corporate governance and ethical business conduct. Important documents reflecting this commitment are listed below.

Corporate Governance Documents

Certificate of Incorporation
Code of Conduct: Our Principles of Ethics & Integrity

Bylaws
Related-Person Transactions Approval Policy

Principles of Governance
Board of Directors Communication Policy

Board of Directors Committee Charters
Political Contributions Policy

Standards for Director Independence
Corporate Environmental Policy

You can access these documents at www.unitedhealthgroup.com/who-we-are/corporate-governance to learn more about our corporate governance practices. We will also provide copies of these documents without charge upon written request to the Company's Secretary to the Board of Directors.

Commitment to Effective Corporate Governance

Board Accountability to Shareholders

Annual Election


 


All directors stand for election by majority vote annually
Proxy Access   Proxy access with market terms
Majority Voting Standard   Majority voting in uncontested director elections, and directors not receiving majority support must tender their resignation for consideration by the Board
Special Meeting / Written Consent Rights   Shareholders have the rights to call a special meeting and act by written consent
No Poison Pill   No shareholder rights plan (commonly referred to as a "poison pill")

 


 


 
Shareholder Voting Rights in Proportion to Economic Interests

One Share, One Vote


 


No dual class structure; each share of common stock is entitled to one vote
No Supermajority Requirements   No supermajority shareholder approval requirements

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Board Responsiveness to Shareholders / Proactive Understanding of Shareholder Perspectives

Shareholder Engagement Process


 


Management and Board members met with key shareholders in 2020
Shareholder engagement topics included Board composition, leadership and refreshment, executive compensation program, inclusion and diversity, and sustainability and social topics

 


 


 
Strong Independent, Board Leadership Structure

Board Leadership


 


Separate CEO and Chair of the Board
Lead Independent Director   Lead Independent Director with clearly defined and robust duties that are disclosed to shareholders
Annual Review   Board considers appropriateness of its leadership structure at least annually
Committee Membership   Independent Committee chairs and fully independent Committees
Disclosure   Proxy discloses why Board believes current leadership structure is appropriate

 


 


 
Adopt Structures and Practices Enhancing Board Effectiveness

Independence


 


80% of our Board members are independent
Diversity   Over 1/3 of our independent Board members are women and 1/4 are African American
Board and Committee Evaluations   Annual Board and Committee evaluation conducted by independent consultant and led by the Chair of Nominating and Corporate Governance Committee
Board Refreshment   Active Board refreshment plan; six new Board members added in last three years, five of whom are standing for election
Attendance   Directors attended 98% of combined total Board and applicable committee meetings in 2020 and all then-current directors attended the 2020 Annual Meeting
Board Service Limits   Independent directors may serve on no more than three other public company boards; and our CEO may serve on no more than one other public company board
Executive Sessions   Frequent executive sessions of independent directors held
Disclosure   Full disclosure of corporate governance policies and practices

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Align Management Incentive Structures with Long-Term Strategy

Say-on-Pay Results


 


Executive Compensation program received more than 95% shareholder support in 2020 and has received more than 95% of the votes cast since our inaugural vote in 2011
Annual Review of Compensation Program   Compensation and Human Resources Committee annually reviews and approves incentive program design, goals and objectives for alignment with compensation and business strategies
Incentive Programs Linked to Strategy   Annual and long-term incentive programs are designed to reward financial and operational performance that furthers short- and long-term strategic objectives
Non-Financial Performance Goals   A portion of our annual incentive award is dependent upon the achievement of goals of customer, provider and employee satisfaction, which are viewed to be important to achieving long-term success for the Company

Strong and effective governance practices are critical to UnitedHealth Group's long-term value creation. The Board has enhanced governance policies over time to align with best practices, drive sustained shareholder value and serve the interests of shareholders. Our corporate governance practices align with the corporate governance principles developed by the Investor Stewardship Group (ISG), which includes some of the largest institutional investors and global asset managers and advocates for best practices in corporate governance.

Code of Conduct: Our Principles of Ethics & Integrity

The Code of Conduct: Our Principles of Ethics & Integrity document is posted on our website and covers our principles and policies related to business conduct, conflicts of interest, public disclosure, legal compliance, reporting and accountability, corporate opportunities, confidentiality, fair dealing and protection and proper use of Company assets. Any waiver of the Code of Conduct for the Company's executive officers, senior financial officers or directors may be made only by the Board of Directors or a committee of the Board. We will publish any amendments to the Code of Conduct and waivers of the Code of Conduct for an executive officer or director on our website. Our global workforce receives periodic training on our Code of Conduct.

Compliance and Ethics

We strongly and broadly encourage employees to raise ethics and compliance concerns, including concerns about accounting, internal controls or auditing matters. We offer several channels for employees and third parties to report ethics and compliance concerns or incidents, including by telephone or online, and individuals may choose to remain anonymous in jurisdictions where anonymous reporting is permissible. We prohibit retaliatory action against any individual who in good faith raises concerns or questions regarding ethics and compliance matters or reports suspected violations. We train all employees annually and periodically advise them regarding the means by which they may report possible ethics or compliance issues and their affirmative responsibility to report any possible issues.

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Risk Oversight

Enterprise-Wide Risk Oversight

Our Board of Directors oversees management's enterprise-wide risk management activities. Risk management activities include assessing and taking actions necessary to manage risk incurred in connection with the long-term strategic direction and operation of our business. Each director on our Board is required to have risk oversight ability for each skill and attribute the director possesses reflected in the collective skills section of our director skills matrix described in "Proposal 1 — Election of Directors — Director Nomination Process — Criteria for Nomination to the Board" above. Collectively, our Board of Directors uses its committees to assist in its risk oversight function as follows:

    The Audit Committee oversees management's internal controls and compliance activities. The Audit Committee also oversees management's processes to identify and quantify material risks facing the Company, including risks disclosed in the Company's Annual Report on Form 10-K. The enterprise risk management function assists the Company in identifying and assessing the Company's material risks. The Company's General Auditor, who reports to the Audit Committee, assists the Company in evaluating risk management controls and methodologies. The Audit Committee receives periodic reports on the enterprise risk management function and the Company's cyber security efforts. In connection with its risk oversight role, the Audit Committee regularly meets privately with representatives from the Company's independent registered public accounting firm and the Company's Chief Financial Officer, General Auditor and Chief Legal Officer;

    The Compensation and Human Resources Committee oversees risks associated with our compensation policies, practices and plans and human capital management practices;

    The Nominating and Corporate Governance Committee oversees Board processes and corporate governance-related risk; and

    The Public Policy Strategies and Responsibility Committee oversees risk associated with the public policy arena, including health care reform and modernization activities, political contributions, government relations, community and charitable activities and corporate social responsibility.

Our Board of Directors maintains overall responsibility for oversight of the work of its various committees by receiving regular reports from the committee chairs regarding their work. In addition, discussions about the Company's culture, strategic plan, consolidated business results, capital structure, merger and acquisition-related activities and other business discussed with the Board of Directors include a discussion of the risks associated with the particular item under consideration. Our Board of Directors and Board committees also have authority to retain independent advisers. Our Board of Directors' and committee's respective processes for managing cybersecurity risk oversight and incentive compensation risk are set forth below.

Cybersecurity Risk Oversight

Our Board recognizes the importance of maintaining the trust and confidence of our customers, clients and employees. We regularly update our Board and the Audit Committee on the Company's cybersecurity program,

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including continual testing and monitoring and ongoing efforts to ensure the security and proper use of confidential and personal information. We devote significant resources to protecting and evolving the security of our computer systems, software, networks and other technology assets in response to a continuously changing threat landscape. The Company regularly updates its cyber policies, procedures and security measures and trains employees and certain business partners on these requirements.

Incentive Compensation Risk Assessment

Our Compensation and Human Resources Committee requested management to conduct an annual risk assessment of the Company's enterprise-wide compensation programs. The risk assessment reviewed both cash incentive compensation plans and individual cash incentive awards paid in 2020 for the presence of potential design elements that could motivate employees to incur excessive risk. The review included the ratio and level of incentive to fixed compensation, the amount of manager discretion, the level of compensation expense relative to the business units' revenues, and the presence of other design features which serve to mitigate excessive risk-taking, such as the Company's clawback policy, stock ownership and retention guidelines, multiple performance measures and similar features.

After considering the results of the risk assessment, management concluded the level of risk associated with the Company's enterprise-wide compensation programs is not reasonably likely to have a material adverse effect on the Company. The results of the risk assessment were reviewed with the Compensation and Human Resources Committee at its February 2021 meeting. Please see "Compensation Discussion and Analysis" for a discussion of compensation design elements intended to mitigate excessive risk-taking by our executive officers.

The Compensation and Human Resources Committee also receives an annual report on the Company's compliance with its equity award program controls.

Alignment of Environment, Social and Governance (ESG) with Our Long-Term Strategy

What Sustainability Means to Us

Our culture, values, and mission — helping people live healthier lives and helping make the health system work better for everyone — align with our long-term strategy to help create a modern, high-performing health system in a socially conscious way that increases access to care, makes care more affordable, enhances the care experience and improves health outcomes.

We continually engage with a broad and diverse set of stakeholders, including consumers, employees, customers, physicians and other health care professionals, suppliers, policymakers and regulators, investors and non-profit partners. Through that stakeholder engagement, and with oversight from our Board and executive management team, we identified the following key sustainability topics:

    1.
    Helping to Create a Modern, High-Performing Health System: As people and communities face rising health care costs and a shortage of health care workers, UnitedHealth Group is committed to a future

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      where every person has access to high-quality, affordable health care that meets their unique needs and improves health outcomes.

    2.
    Our People and Culture: We are advancing an inclusive environment in which diverse people, experiences and perspectives make us better. We are connected, worldwide, by our values — compassion, integrity, innovation, performance and relationships. From doctors, nurses and technologists to customer care professionals and data scientists, our diverse team is adaptable and committed to shaping the future of health care in collaboration with the people we are privileged to partner with and serve.

    3.
    Responsible Business Practices: Strong and effective governance practices support our ability to help create a modern, high-performing health system.

    4.
    Environmental Health: We recognize the important role the environment plays in the health of every community and we are committed to mitigating our impact on the environment. We work to minimize the impact our business operations have on the environment through our environmental management system, stakeholder engagement and stewardship initiatives.

We are dedicated to earning the opportunity to serve more people and driving distinctive shareholder and societal returns by focusing on these objectives.

Our inaugural Sustainability Report, available at https://www.unitedhealthgroup.com/what-we-do/sustainability/sustainability.html, summarizes the steps the Company is taking to build a health system that works better for everyone through the organization's environmental, social and governance efforts.

Our Public Policy and Strategies and Responsibilities Committee has oversight over our sustainability performance, including responsible social and environmental practices. The Public Policy and Strategies and Responsibilities Committee also oversees UnitedHealth Group's public policy, health care reform and modernization activities, political contributions, external affairs, and community and charitable activities.

Inclusion and Diversity

At UnitedHealth Group, we value, include and learn from diverse people and perspectives. We build stronger connections with each other, deliver products and services that work better for those we serve, and achieve more meaningful outcomes. Our data-driven approach to talent attraction and development helps us build a culture of inclusion and develop a pipeline of diverse leaders.

Inclusion and diversity is a focus of our senior management and our Board, centered around:

    Pay Equity — We are committed to pay equity in several respects, including by gender, ethnicity and race, while ensuring a living wage for all our employees.

    Diverse Hiring & Development — Led by senior leaders, we have established strategies to address diverse leadership advancement, reduce the impact of unconscious bias, and promote strong stewardship our servant leader culture.

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    Business Action Planning — We benchmark practices against global inclusion and diversity best practices to help leaders determine the priority actions they need to take to integrate culture, inclusion and diversity, and social responsibility in our business and people processes.

    Inclusion & Diversity Center of Expertise — Led by a chief inclusion and diversity officer, an enterprise team drives our strategies and initiatives focused on promoting inclusivity and diversity throughout the organization. The Center collaborates closely with internal business councils and external organizations in the communities we serve that share our commitment to inclusion and diversity.

We have made and will continue to make meaningful progress on our activities focused on inclusion and diversity.

    Our Compensation and Human Resource Committee charter formalizes oversight responsibility of inclusion and diversity initiatives and workforce demographics;

    Signed the CEO Action for Inclusion and Diversity;

    Founded an enterprise Equity Advancement Board, chaired by our Chief Human Resources Officer and comprised of 16 senior executive leaders with deep expertise in equity and health equity issues to provide executive leadership, direction and decision making to drive meaningful and sustained progress toward advancing equity and inclusion for team members, customers, partners, suppliers, and communities;

    Maintain eight employee resource groups called "Connected Communities" that enable employees to share their cultural backgrounds and life experiences to foster a more inclusive, diverse workplace aligned with our mission and values; and

    Expanded our inclusion and diversity educational resources through a dedicated learning system available to all employees that helps build greater knowledge and understanding of topics and issues related to inclusion, diversity, and belonging.

Additional information on our inclusion and diversity efforts and human capital management can be found in our Sustainability Reports.

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Executive Compensation

Executive Summary

Overview

UnitedHealth Group's compensation program is designed to attract and retain highly qualified executives and to maintain a strong link between pay and the achievement of enterprise-wide goals. We emphasize and reward teamwork and collaboration among executive officers, which we believe fosters Company growth and performance, optimizes the use of enterprise-wide capabilities, drives efficiencies and integrates products and services for the benefit of our customers and other stakeholders.

In determining 2020 executive compensation, the Compensation and Human Resources Committee considered the Company's strong growth, operating performance and financial results, all of which were achieved in an uncertain environment, as well as individual executive performance. Some of our key business results for 2020 were:

Financial

    Revenues increased 6.2% to $257.1 billion in 2020 from $242.2 billion in 2019;

    Operating earnings increased 13.8% year-over-year to $22.4 billion; net earnings increased 11.3% year-over-year to $15.4 billion; and cash flows from operations grew 20.1% year-over-year to $22.2 billion;

    Diluted earnings per share increased 11.9% to $16.03 per share from $14.33 in 2019. Adjusted earnings per share1 increased 11.7% to $16.88 per share from $15.11 per share in 2019;

    Return on equity at 24.9% in 2020 compared to 25.7% in 2019, reflecting the Company's strong overall operating performance and efficient capital structure;

    Total shareholder return in 2020 was 21%, and 65% from 2018-2020, reflecting continued strong fundamental performance; and
    Our annual cash dividend rate increased to $5.00 per share, representing a 16% increase over the annual cash dividend rate of $4.32 per share since the second quarter of 2019.

Awards and Recognition

    UnitedHealth Group was the top ranked company in the insurance and managed care sector on Fortune's 2021 "World's Most Admired Companies" list. This is the eleventh consecutive year UnitedHealth Group has ranked No. 1 overall in its sector. The Company ranked No. 1 on all nine key attributes of reputation — innovation, people management, use of corporate assets, social responsibility, quality of management, financial soundness, long-term investment value, quality of products and services and global competitiveness. In addition, the Company was named to the "All-Star" list of Fortune's 2021 top 50 most admired companies.

    UnitedHealth Group was named to both the Dow Jones Sustainability World and North America Indices since 1999;

    UnitedHealth Group received a perfect score of 100 on the Human Rights Campaign Foundation's Corporate Equality Index 2021, earning the distinction of one of the "Best Places to Work for LGBTQ Equality";

    UnitedHealth Group was named one of America's Most JUST Companies by JUST Capital and Forbes in 2020. The JUST 100 rankings measure how U.S. companies perform on issues Americans care about most, including worker pay and treatment, customer respect, product quality and environmental impact;

    In 2020 and for the ninth consecutive year, The Civic 50, a Points of Light initiative that highlights companies that improve the quality of life in the communities where they do business, ranked UnitedHealth Group one of America's 50 most community-minded companies;

1
Adjusted earnings per share is a non-GAAP financial measure. Refer to Appendix B in this proxy statement for a reconciliation of adjusted earnings per share to the most directly comparable GAAP measure.

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    The Carbon Disclosure Project named UnitedHealth Group to its Leadership Band in 2020 for efforts to reduce greenhouse gas emissions;

    The National Business Group on Health honored UnitedHealth Group with a 2020 "Best Employers: Excellence in Health & Well-Being" top-tier Platinum award;

    The Disability Equality Index® named UnitedHealth Group one of the best places to work for disability inclusion in 2021; and

    UnitedHealth Group has been ranked No. 6 in the nation on the 2021 Military Friendly® Employers list.

The Compensation and Human Resources Committee believes total compensation for the executive officers listed in the 2020 Summary Compensation Table (the "named executive officers" or "NEOs") should be heavily weighted toward long-term performance-based compensation. In 2020, long-term compensation represented approximately 75% of the total compensation granted to our named executive officers. The elements of compensation for our named executive officers were unchanged from 2019.

We endeavor to maintain strong governance standards in the oversight of our executive compensation programs, including the following policies and practices in effect during 2020:

Strong Oversight and Pay Practices

    Compensation and Human Resources Committee consisting entirely of independent Board members.

    Performance-based compensation arrangements, including performance-based equity awards that use a balanced set of performance measures, with different metrics used for annual and long-term incentive plans.

    Double-trigger accelerated vesting of equity awards, requiring both a change in control and a qualifying employment termination, which is our only change in control consideration.

    All long-term incentive awards are denominated and settled in equity.
    A compensation clawback policy that entitles the Board of Directors to seek cash or equity reimbursement from our senior executives if they are involved in fraud or misconduct that causes a material restatement, or in the event of a senior executive's violation of non-compete, non-solicit or confidentiality provisions.

    A stock retention policy that generally requires executive officers to hold, for at least one year, one-third of the net shares acquired upon vesting or exercise of any equity award.

    Each of our executive officers and directors was in compliance with our stock ownership guidelines as of April 9, 2021. Andrew Witty, our CEO, is required to own shares equal to eight times his base salary by the fifth anniversary of his appointment as CEO.

    Annual advisory shareholder vote to approve the Company's executive compensation.

    The direct retention by the Compensation and Human Resources Committee of its independent compensation consultant, Pay Governance LLC, who performs no other consulting or other services for the Company.

What We Don't Do

    No excise tax gross-ups. Generally no executive-only perquisites.

    No repricing of stock options and stock appreciation rights or cash buyouts without shareholder approval.

    No discounted stock options or stock appreciation right awards.

    No reload of stock options.

    No hedging and pledging transactions by directors and executive officers.

COVID-19 Considerations

The Company did not change its performance targets for any of its executive compensation plans as a result of COVID-19.

CEO Succession

On February 3, 2021, Andrew Witty was appointed the Company's CEO, succeeding David Wichmann.

2021 Proxy Statement    |    Executive Compensation Summary    33


Table of Contents

  1

Board of
Directors


2

Corporate
Governance


3

Executive
Compensation


4

Audit

5

Annual
Meeting


6

Other
Information

 

Performance Graph

The following performance graph compares the cumulative five-year total return to shareholders on our common stock relative to the cumulative total returns of the S&P Health Care Index, the Dow Jones US Industrial Average Index and the S&P 500 index for the five-year period ended December 31, 2020. The comparisons assume the investment of $100 on December 31, 2015 in our common stock and in each index, and dividends were reinvested when paid.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
Among UnitedHealth Group, the S&P Health Care Index,
the Dow Jones US Industrial Average Index and the S&P 500 Index

GRAPHIC