Celanese (CE) DEF 14ADefinitive proxy

Dear Fellow Shareholders:

As I reflect on 2021 and the first part of 2022, I am proud of what Celanese was able to accomplish for its customers, employees and shareholders in the face of many hurdles. To me, it speaks to the power of our business model and our culture.

We started the year seeing recovery across all of our businesses, but also witnessing a resurgence of COVID globally. The question of how fast the recovery would be was first and foremost in our minds, and the year brought challenges almost immediately.

With its unanticipated magnitude, the February 2021 deep freeze in the U.S. Gulf Coast shut down our Texas facilities, stressed all of our operations and supply chains globally, and dealt personal hardships to our employees in Texas. Throughout the rest of the year our business was tested by global transportation and logistics disruption, energy curtailments in China, the global semiconductor chip shortage, and rapidly-increasing raw material and energy costs.

We faced all of these hurdles while continuing to prioritize the safety of our employees during an ever-evolving global pandemic and delivered record business and financial results. Our key victories in 2021 and early 2022 in advancing business and sustainability include:

Our team is proud of the accomplishments described in this Proxy Statement. We worked with resiliency and grit to deliver record 2021 adjusted earnings per share and free cash flow while returning significant capital to shareholders and advancing our sustainability journey, as you can read about in more detail in these pages. A special thank you to Celanese employees for their dedication and efforts.

Please join our Board of Directors and executive officers on April 20, 2022, at 1:00 p.m. Central time, when we hold our Annual Meeting of Shareholders in live virtual format. Your vote is very important, and whether or not you are able to attend the event in real time, we encourage you submit your voting instructions by proxy as described in this document. We look forward to your participation.

Thank you for your continued support of Celanese.

Sincerely,

Dear Fellow Shareholders:

As the Lead Independent Director of the Board of Directors, I am honored to have the opportunity to write to our shareholders to review some of the highlights of Celanese’s 2021 efforts and accomplishments in advance of our upcoming Annual Meeting of Shareholders.

The Board is pleased with Celanese’s accomplishments in 2021: record financial performance, continued execution against its long-term strategy, and accomplishment of significant milestones on Celanese’s continuing environmental, social and governance (ESG) journey. In last year’s Proxy Statement, we communicated to you about the Board’s and management’s purposeful efforts during a difficult and unprecedented 2020 to protect our people and business and to position Celanese for recovery. We believe Celanese’s 2021 results and progress demonstrate the success of those efforts.

Through our shareholder outreach program, we have heard from our investors a high level of interest in Celanese’s work to promote a more sustainable world through addressing the threat of climate change and fostering a diverse and inclusive workforce, as well as how the Board oversees Celanese’s ESG initiatives. As detailed in these pages, the Board and management have responded to our shareholders by making thoughtful, deliberative progress in these areas.

These efforts are overseen by a Board representing variety of viewpoints and experience. Through thoughtful refreshment, the Board has added five new directors in the last five years, most recently adding Rahul Ghai, an experienced financial executive, and Michael Koenig, a long-time materials industry executive. Three of these directors added in the last five years are women and two are racially diverse. The Board believes this mix of fresh perspectives is an effective complement to the experience and knowledge of our longer-serving directors. We are committed to continuous improvement in the diversity of our leadership and our organization.

Your Board remains committed to effective oversight of the Company’s operations, long-term strategy and risk management to foster long-term sustainable growth for our shareholders. On behalf of the Board of Directors, I would like to express our sincere appreciation for the trust that Celanese shareholders have placed in us, and we look forward to continuing to serve you throughout the upcoming year.

It is very important that you vote in order to play a part in the future of the Company. Please carefully review the proxy materials for the Annual Meeting and follow the instructions below to cast your vote on all of the voting matters.

You are entitled to vote at the Annual Meeting if you were a shareholder at the close of business on February 22, 2022, the record date for the meeting. On the record date, there were 108,029,267 shares of the Company’s Common Stock issued, outstanding and entitled to vote at the Annual Meeting.

Pursuant to U.S. Securities and Exchange Commission (“SEC”) rules, we have elected to furnish proxy materials to our shareholders via the Internet instead of mailing printed copies of those materials to each shareholder. If you received a Notice of Internet Availability of Proxy Materials (“Notice of Internet Availability”) by mail, you will not receive a printed copy of the proxy materials unless you request one. Instead, the Notice of Internet Availability will instruct you as to how you may access and review the proxy materials and cast your vote on the Internet. If you received a Notice of Internet Availability by mail and would like to receive a printed copy of our proxy materials, please follow the instructions included in the Notice of Internet Availability. Shareholders who requested paper copies of proxy materials or previously elected to receive proxy materials electronically will not receive the Notice of Internet Availability and, instead, will receive the proxy materials in the format requested. This Proxy Statement, our 2021 Annual Report and other information about the Annual Meeting also are available in the “News & Events” section of our website, https://investors.celanese.com.

The Notice of Internet Availability and, for shareholders who previously requested electronic or paper delivery, the proxy materials will be mailed on March 10, 2022, to shareholders of record and beneficial owners who owned shares of the Company’s Common Stock at the close of business on February 22, 2022.

Our principal executive offices are located at 222 W. Las Colinas Blvd., Suite 900N, Irving, Texas 75039.

Based on the recommendation of our independent Nominating and Corporate Governance Committee (the “N&CG Committee”), our Board of Directors has nominated eleven directors — Jean S. Blackwell, William M. Brown, Edward G. Galante, Rahul Ghai, Kathryn M. Hill, David F. Hoffmeister, Dr. Jay V. Ihlenfeld, Deborah J. Kissire, Michael Koenig, Kim K.W. Rucker and Lori J. Ryerkerk — to serve a one-year term expiring at the 2023 Annual Meeting of Shareholders. These director nominees have consented to be elected to serve as directors for the next year.

At the Annual Meeting, shareholders will have the opportunity to elect these nominees. Unless otherwise instructed, the proxy holders will vote the proxies received by them for these eleven nominees. If any of our nominees is unable or declines to serve as a director as of the time of the Annual Meeting, the Board may designate a substitute nominee or reduce the size of the Board. Proxies will be voted for any nominee who shall be designated by the Board of Directors to fill the vacancy.

The name of each of our nominees for election and certain information about them, as of the date of this Proxy Statement (except ages, which are as of the date of the Annual Meeting), is set forth below. Included in the information below is a description of the particular qualifications, attributes, skills and experience that led the Board to conclude that each person below should serve as a director of the Company.

The election of Messrs. Ghai and Koenig to the Board in February 2022 was the result of a strategic succession planning effort by the Board and the N&CG Committee to bring additional materials industry experience, to enhance the global perspective of our Board given our increasingly global footprint, and bring additional operating and financial expertise following the retirement of John Wulff after more than 14 years of service. The N&CG Committee engaged a search firm to identify qualified candidates. This firm identified Messrs. Ghai and Koenig, among other candidates, as qualified nominees. The N&CG Committee and the full Board carefully reviewed the experience, skills and attributes of Messrs. Ghai and Koenig, along with those of a number of other qualified candidates, as well as their independence. After interviews, the N&CG Committee and the Board determined to elect each of them to the Board in February 2022 and to recommend to our shareholders that they be elected at the 2022 Annual Meeting.

The Board and the N&CG Committee require that each director be a recognized person of high integrity with a proven record of success in his or her field and have the ability to devote the time and effort necessary to fulfill his or her responsibilities to the Company. Each director must demonstrate innovative thinking, familiarity with and respect for corporate governance requirements and practices, a willingness to assume fiduciary responsibilities, an appreciation of diversity and a commitment to sustainability and to dealing responsibly with social issues. In addition, the Board conducts interviews of potential director candidates to assess integral qualities, including the individual’s ability to ask difficult questions and, simultaneously, to work collegially.

The Board considers diversity of race, ethnicity, gender, age, cultural background and professional experience in evaluating candidates for Board membership and assesses the effectiveness of this policy through the N&CG Committee’s annual review of director nominees. The Board believes that diversity results in a variety of points of view and, consequently, a more effective decision-making process. The Board has added three women directors and two racially/ethnically diverse directors in the last five years.

The Board has identified particular qualifications, attributes, skills and experience that are important to be represented on the Board as a whole, in light of the Company’s current and expected future business needs. These are summarized in the following table.

Each director must receive a majority of the votes cast in favor of his or her election.

Each year, the members of the Board and each committee conduct a self-assessment. The process for the self-assessment is approved by the Board each year based on a recommendation from the N&CG Committee. In 2020, the N&CG recommended, and the Board approved, updates to refresh its annual self-assessment process.

Under the process used in 2021, the N&CG Committee develops a thorough list of topics to be considered by the directors. These topics are incorporated into a Board questionnaire that is completed by each director and committee-specific questionnaires for each committee. The completion of the questionnaires is followed by teleconferences held by our Senior Vice President and General Counsel with each independent director, including the Lead Independent Director, and then finally with the Chairman and CEO, to discuss the topics and to gather any other feedback a director has as they relate to the full Board and each of the committees. The input from the questionnaires and conversations is summarized and presented to the full Board (and to the independent directors as to the CEO) and to the individual committees at the October Board and committee meetings.

An overview of our current process is illustrated below.

Also, the N&CG Committee and full Board evaluate directors who are nominees for re-election to the Board as part of the nomination process.

The Company’s governance framework provides the Board with flexibility to select the appropriate leadership structure for the Company. In making leadership structure determinations, the Board considers many factors, including the specific needs of the business and what is in the best interests of the Company’s shareholders.

In April 2020, the Board elected Chief Executive Officer Lori Ryerkerk to serve as Chairman of the Board. The Board made this election as part of the planned transition of leadership from Mark Rohr. Mr. Rohr served as CEO until Ms. Ryerkerk’s appointment into that role in May 2019 and then served as Executive Chairman until June 2020. Therefore, the current leadership structure is comprised of a combined Chairman of the Board and Chief Executive Officer, a Lead Independent Director, and Board committees comprised exclusively of and chaired by independent directors, together with active engagement by all directors. The Board believes the structure provides an effective balance between strong company leadership and appropriate safeguards and oversight by independent directors.

The duties and responsibilities of the Company’s Lead Independent Director are documented in the Lead Independent Director Policy, which is part of our corporate governance guidelines. The Company’s Lead Independent Director, who is elected by the independent directors for a one-year term:

Consistent with the Board’s commitment to corporate governance practices that are in the best interests of the Company and its shareholders, at least one executive session of the directors each year includes a review of the Board’s leadership structure and consideration of whether the position of Chairman of the Board should be held by the Chief Executive Officer or an independent director. This section describes the details and the Board’s rationale for its current leadership structure.

Under the Company’s by-laws, the Chairman presides over meetings of the Board, presides over meetings of shareholders, consults and advises the Board and its committees on the business and affairs of the Company and performs such other duties as may be assigned by the Board. The Chief Executive Officer is generally in charge of the daily affairs of the Company, subject to the overall direction and supervision of the Board and its committees and subject to such powers as reserved by the Board. Lori Ryerkerk currently serves as Chairman of the Board and Chief Executive Officer.

The Board has had a Lead Independent Director role for more than a decade. In February 2021, the independent directors elected William M. Brown to serve as Lead Independent Director beginning after the 2021 Annual Meeting (held in April 2021), and the independent directors re-elected Mr. Brown as Lead Independent Director in February 2022. Although annually elected, the Lead Independent Director is generally expected to serve for more than one year, although generally not more than three to five years.

Importantly, all directors play an active role in overseeing the Company’s business both at the Board and committee levels. As set forth in the Company’s corporate governance guidelines, the core responsibility of the directors is to exercise their business judgment to act in what they reasonably believe to be in the best interests of the Company and its shareholders. The Board currently consists of the Chairman and Chief Executive Officer and ten independent directors. The independent directors are skilled and experienced leaders in business. Many currently serve or have served as chief executives or members of senior management of Fortune 1000 companies and/or as senior leaders in top consulting, accounting and law firms. In these roles, the independent directors have been called upon to provide solutions to various complex issues and are expected to, and do, ask hard questions of management. As such, the independent directors are well-equipped to oversee the success of the business and to provide advice and counsel to the Chief Executive Officer and Company management.

As part of each regularly scheduled Board meeting, the independent directors meet in executive session without the Chairman/CEO present. These meetings allow independent directors to discuss issues of importance to the Company, including the business and affairs of the Company, as well as matters concerning management, without any member of management present. All of the Board committees, which are described below, are chaired by, and comprised entirely of, independent directors.

The Board believes that combined leadership of the Board and the Company by Ms. Ryerkerk is currently the optimal structure to guide the Company, provide consistent leadership and maintain the focus required to achieve the Company’s long-term business goals.

The Board believes that the current leadership structure – a combined Chairman and Chief Executive Officer, a lead Independent Director, Board committees comprised exclusively of independent directors and active engagement by all directors – is effective and currently serves the business and shareholders well.

Each of our directors is expected to devote sufficient time and attention to his or her duties and to attend all Board meetings and committee meetings on which he or she serves. The Board of Directors held seven meetings during 2021 and committees of the Board held a total of 21 meetings. Overall attendance at such meetings was 100%. Therefore all incumbent directors attended at least 75% of the aggregate of (i) meetings of the Board and

(ii) meetings of the Board committees on which they served during the fiscal year ended December 31, 2021. In addition, the Board expects directors to attend the annual meeting of shareholders absent special circumstances. All of our directors who were members of the Board as of the 2021 Annual Meeting of Shareholders attended the 2021 Annual Meeting.

The Board of Directors has four standing Board committees:

The following table sets forth the current composition of our committees as of the date of this Proxy Statement:

The Company’s Audit Committee (the “Audit Committee”) is currently comprised of Ms. Kissire (chair), Ms. Blackwell, Mr. Ghai, Mr. Hoffmeister and Ms. Rucker, each of whom the Board has affirmatively determined is independent of the Company and its management under the rules of the NYSE and the SEC. The Board has also determined that Ms. Blackwell, Mr. Ghai, Mr. Hoffmeister and Ms. Kissire are “Audit Committee Financial Experts” as the term is defined in applicable SEC rules. Each member of the Audit Committee is also “financially literate” as that term is defined by the rules of the NYSE. The complete text of the Audit Committee charter, as last reviewed and approved by the Board of Directors on April 14, 2021, is available on our website, https://investors.celanese.com, by clicking “Corporate Governance”.

The Audit Committee is directly responsible for the appointment, compensation and oversight of the work of the Company’s independent registered public accounting firm. The independent registered public accounting firm reports directly to the Audit Committee. The principal purposes of the Audit Committee are to oversee:

The Audit Committee Charter provides that the Audit Committee may, in its sole discretion and at the Company’s expense, retain legal accounting or other consultants or experts it deems necessary in the performance of its duties and without having to seek the approval of the Board.

The principal purposes of the CMDC are to:

The Company’s N&CG Committee is currently comprised of Ms. Rucker (chair), Ms. Blackwell, Mr. Brown, Mr. Ghai and Mr. Hoffmeister. The complete text of the N&CG Committee charter, as last reviewed and approved by the Board of Directors on April 14, 2021, and our corporate governance guidelines, as last reviewed and approved by the Board of Directors on April 14, 2021, are available on our website, https://investors.celanese.com, by clicking “Corporate Governance”. The N&CG Committee charter provides that the N&CG Committee may, in its sole discretion and at the Company’s expense, retain legal and other consultants or experts, including but not limited to leadership search firms, the N&CG Committee deems necessary in the performance of its duties, including in its process of identifying director candidates.

The principal purposes of the N&CG Committee are to:

During 2021, Willis, as independent outside compensation consultant, advised the N&CG Committee on non-employee director compensation matters.

The Company’s Environmental, Health, Safety, Quality and Public Policy Committee (the “EHS Committee”) is currently comprised of Ms. Hill (chair), Mr. Galante, Dr. Ihlenfeld , Ms. Kissire and Mr. Koenig. The EHS Committee assists the Board in fulfilling its oversight duties regarding, while Company management retains responsibility for assuring compliance with, applicable environmental, health and safety laws and regulations. The complete text of the EHS Committee charter, as last amended by the Board of Directors on April 14, 2021, is available on our website, https://investors.celanese.com, by clicking “Corporate Governance”.

The principal purposes of the EHS Committee are to:

Shareholders elect the Board to oversee management and to serve shareholders’ long-term interests. Management is responsible for delivering on our strategy, creating our culture, creating and delivering innovative products and services, establishing accountability, and controlling risk. The Board and its committees work closely with management to balance and align strategy, risk, corporate social responsibility, and other areas while considering feedback from shareholders. Essential to the Board’s oversight role is a transparent and active dialogue between the Board and its committees, and management. To support that dialogue, the Board and its committees have access to, receive presentations from, and conduct regular meetings with the senior leadership team, other business and function leaders, subject matter experts, the Company’s enterprise risk management and internal audit functions, and external experts and advisors.

One of the Board’s primary responsibilities is overseeing management’s establishment and execution of the Company’s strategy. As Celanese continues to transform and expand its business, the Board works with management to respond to a dynamically changing environment. At least quarterly, the CEO, the senior leadership team, and leaders from across the Company provide detailed business and strategy updates to the Board. At least annually, the Board conducts an even more in-depth review of the Company’s overall strategy, including critical issues, risks and opportunities. At all of these reviews, the Board engages with the senior leadership team and other business leaders regarding business objectives, the competitive landscape, economic trends, environmental and sustainability goals and investments, public policy and regulatory developments and other critical issues. At meetings occurring throughout the year, the Board also assesses acquisitions, the Company’s operating and capital plan, and performance for alignment to our strategy. The Board looks to the focused expertise of its committees to inform strategic oversight in their areas of focus. Members of senior management are available to discuss the Company’s strategy, plans, results and issues with the Board committees and the Board, and regularly attend such meetings to provide periodic briefings and access. In addition, the Audit Committee regularly holds separate executive sessions with the lead client service partner of the independent registered public accounting firm, the chief financial officer, the internal auditor, the chief compliance officer and other members of management as appropriate.

Effective risk management is critical to Celanese’s ability to achieve its strategy and ESG goals. The Board oversees management in exercising its responsibility for managing risk, considering our robust framework of policies, procedures, and processes to anticipate, identify, assess, prioritize, and mitigate risks across the Company. Risk management is considered a strategic activity within the Company and responsibility for managing risk rests with executive management while the committees of the Board and the Board as a whole participate in the oversight of the process. Specifically, the Board has responsibility for overseeing the strategic planning process, reviewing and monitoring management’s execution of the strategic and business plan, and selected risk areas, including cybersecurity. Each Board committee is responsible for oversight of specific risk areas relevant to their respective committee charter. The oversight responsibility of the Board and the Board committees is enabled by an enterprise risk management model and process implemented by management that is designed to identify, assess, manage and mitigate risks. In addition, the Board recognizes that risk management and oversight comprise a dynamic and continuous process and reviews the enterprise risk model and process periodically. On a regular basis, the Board and its committees engage with management on risk as part of broad strategic and operational discussions which encompass interrelated risks, as well as on a risk-by-risk basis.

The Board executes its oversight responsibility directly and through its committees. Committees discuss the Company’s risk exposures with management, the internal audit executive and the independent external auditor in an iterative risk assessment process. Results of risk audits are routinely reported to leadership and the Audit Committee, which regularly reports back to the Board. Some examples of risks overseen by committees are:

Each of the Board committees is required to make regular reports of its actions and any recommendations to the Board with respect to risk management, including recommendations to assist the Board with its overall risk oversight function. In addition, an annual report of enterprise risks, which undergo a comprehensive review using strategic, operational, financial, compliance and IT risk themes, is delivered to the Board. This approach to risk oversight does not affect the Board’s leadership structure.

The Board, the CMDC, and the EHS Committee engage with the senior leadership team and human resources executives on a regular basis across a broad range of human capital management issues. Celanese is focused on creating a respectful, safe, rewarding, diverse, and inclusive work environment that allows our people to build meaningful careers. The success of these human capital management objectives is important to the fulfillment of our strategy, and the Board works with management to provide oversight on matters including culture, succession planning and development, compensation, benefits, employee recruiting and retention, diversity, equity and inclusion and respectful workplace. Additionally, each year, the CMDC Committee evaluates management’s annual assessment of risk related to our compensation policies and practices. The Board and the CMDC Committee work with the CEO and our head of Human Resources to review CEO and senior executive succession plans, considering the qualifications and experience of potential leadership candidates.

The Board and the Audit Committee are each involved in oversight of the Company’s management of cybersecurity risk. Cybersecurity protection is vital to maintaining our proprietary information and the trust of our customers and employees. We recognize the importance of securing our data and systems from potential breach. Management provides regular updates to the Board, including information about cybersecurity governance processes, the status of projects to strengthen internal cybersecurity, and the results of security breach simulations. The Board and its committees also discuss recent incidents throughout the industry and the emerging threat landscape.

To protect the Company, we maintain cyber/information security insurance with coverage for security incident response expenses, certain losses due to network security failures, investigation expenses, privacy liability and certain third-party liability. In early 2021, we hired a Chief Information Security Officer to further support our efforts to protect our information and manage our cybersecurity risks.

The Board provides oversight of Celanese’s strategic acquisition and integration process, which supports alignment with our strategic objectives, provides accountability across acquisitions, and enables insight for future acquisitions. Our Board has a depth of extensive negotiation, acquisition, integration, and other business combination experience that allows directors to constructively engage with management and effectively evaluate acquisitions for alignment with our strategy and culture. Celanese views strategic acquisitions as an important element in delivering long-term shareholder value. While management is charged with identifying potential acquisition targets, executing transactions, and managing integration, our Board’s oversight extends to each phase. Management and the Board regularly discuss potential acquisitions and their role in the Company’s overall business strategy. These discussions include acquisitions in process and potential future acquisitions, focusing on valuation, strategic risk, and potential synergies with our businesses and strategy. When management considers potentially significant acquisitions, the Board receives updates and discusses with management a broad range of matters, including negotiations, due diligence findings, valuation, tax impacts, integration planning, talent retention, environmental and other risk, and regulatory impacts. Throughout the acquisition process, the Board has access to the senior leadership team, appropriate business leaders, subject matter experts, and external advisors. As part of the entire strategic acquisition lifecycle, the Board also receives regular updates and provides feedback on ongoing integration, operational success, and financial performance of our completed acquisitions, which allows the Board to provide oversight and to identify trends and opportunities across transactions and over time.

We recognize that our success is defined by multiple groups of stakeholders – investors, customers, employees, communities – and this recognition is reflected in our efforts to promote safety and protect our environmental resources as a responsible corporate citizen.

In 2019, CEO Lori Ryerkerk recognized the need to lead the next generation of sustainability efforts for the Company and formed the Celanese ESG Council. Our ESG Council is a cross-functional team of senior leaders from each region to develop, make recommendations to management and implement an ESG strategy on topics significant to Celanese’s long-term success.

The ESG Council meets monthly to form recommendations to senior leadership on key ESG program strategy and implementation of ESG-related projects. For example, the ESG Council has made recommendations on standards reporting alignment, further development of key KPIs, and has led the publication of the Company’s inaugural comprehensive Sustainability Report, available on sustainability.celanese.com.

During 2021, our Board of Directors and its committees conducted an in-depth review of their approach to overseeing ESG topics most significant to Celanese. In April 2021, our Board agreed on a strengthened and clarified framework for overseeing priority ESG matters by aligning a specific committee or the full Board to each. The diagram below illustrates primary Board or committee oversight responsibility by topic.