Rick Hessling
Marathon PetroleumAbout Rick Hessling
Rick D. Hessling is Chief Commercial Officer (CCO) of Marathon Petroleum Corporation (MPC), promoted effective January 1, 2024 after serving as Senior Vice President, Global Feedstocks . He is retirement-eligible and has 34.58 years of credited service, indicating deep tenure in MPC’s commercial and supply chain operations . MPC’s 2024 performance context for executive pay-for-performance includes net income of $3.4B, adjusted EBITDA of $11.3B, and net cash from operations of $8.7B, with three-year PSU TSR of ~140% at the 92nd percentile of the peer group; the 2022 PSU cycle paid out at 183.33% and Hessling’s payout was $2,355,696, underscoring strong alignment to shareholder returns .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Marathon Petroleum Corporation | Senior Vice President, Global Feedstocks | Prior to Jan 1, 2024 | Part of 2024 leadership transition designed to position MPC for continued operational and financial excellence and drive shareholder value |
External Roles
No public external roles disclosed in the 2025 proxy for Hessling .
Fixed Compensation
| Component | 2024 |
|---|---|
| Base Salary ($) | $675,000 |
| Target Bonus (% of eligible earnings) | 90% (increased from 70% upon promotion to CCO) |
| Actual ACB Bonus Paid ($) | $949,800 (156.34% of target) |
| All Other Compensation ($) | $111,177 |
Performance Compensation
2024 Annual Cash Bonus Program (ACB) – Company Metrics
| Metric | Weight | Threshold | Target | Maximum | Actual/Result | Payout vs Target |
|---|---|---|---|---|---|---|
| Relative Adjusted EBITDA per Barrel | 30% | 30th percentile | 50th percentile | 100th percentile | 100th percentile | 200.00% |
| ACB Adjusted EBITDA ($mm) | 20% | $9,487 | $12,649 | $15,811 | $9,664 | 52.80% |
| MPLX Distributable Cash Flow per Unit | 20% | $4.70 | $5.22 | $5.74 | $5.70 | 192.31% |
| Refining & Corporate Costs ($mm) | 10% | $6,858 | $6,532 | $6,205 | $6,456 | 123.24% |
| Non-Financial Scorecard (Safety, Environmental, HCM) | 20% | — | — | — | Funded at 35% | 35% |
| Overall ACB Payout | — | — | — | — | — | 156.34% |
Notes:
- Financial metric rigor described; Committee made no ex-post adjustments to metrics or payouts .
- Non-financial results included improved safety and environmental outcomes (e.g., Process Safety Events score +7%, GHG intensity aligned to target) .
2024 Long-Term Incentive (LTI) Target Mix and Grants
| Component | LTI Target Mix | 2024 Target $ | 2024 Grants (Units/$) | Performance Metric | Vesting |
|---|---|---|---|---|---|
| MPC PSUs | 60% | $1,200,000 | 7,111 target PSUs; $1,493,452 grant-date value | 3-year relative TSR vs peer; 0–200% payout; capped at 100% if TSR negative | Single vest at end of 36 months |
| MPC RSUs | 20% | $400,000 | 2,370 RSUs; $410,508 grant-date value | Time-based | Ratably over 3 years |
| MPLX Phantom Units | 20% | $400,000 | 10,379 units; $404,781 grant-date value | Time-based | Ratably over 3 years |
PSU performance history and 2022 cycle payout for Hessling:
- 2022 PSU cycle (Jan 1, 2022–Dec 31, 2024) achieved 139.72% PSU TSR, 2nd of 13 peers, 91.67th percentile, payout 183.33% of target; Hessling payout $2,355,696 .
Equity Ownership & Alignment
Beneficial Ownership (as of Feb 1, 2025)
| Security | Amount Beneficially Owned | % Outstanding |
|---|---|---|
| MPC Common Stock | 8,342 shares | <1% |
| MPLX Common Units | 28,802 units | <1% |
- RSUs counted toward ownership guidelines; none of the shares or units shown are pledged; hedging/pledging prohibited by policy .
Outstanding Equity Awards at 2024 Year-End (Unvested)
| Award Type | Unvested Quantity | Market/Payout Value |
|---|---|---|
| MPC RSUs | 4,203 | $586,319 (at $139.50) |
| MPC PSUs | 11,947 | $3,333,213 (assumes 200% payout at $139.50) |
| MPLX Phantom Units | 15,798 | $756,092 (at $47.86) |
Vesting Schedule Detail (Time-Based Awards)
| Grant | RSUs Not Vested (#) | RSU Vesting Dates | MPLX Phantom Units Not Vested (#) | Phantom Vesting Dates |
|---|---|---|---|---|
| 3/1/2022 | 888 | 3/1/2025 | 2,103 | 3/1/2025 |
| 3/1/2023 | 1,034 | 3/1/2025, 3/1/2026 | 3,704 | 3/1/2025, 3/1/2026 |
| 3/1/2024 | 2,281 | 3/1/2025, 3/1/2026, 3/1/2027 | 9,991 | 3/1/2025, 3/1/2026, 3/1/2027 |
- Option awards: None granted since 2020; Hessling had no option exercises in 2024 .
Ownership Guidelines and Compliance
| Position Tier | Required Multiple of Base Salary | Policy Notes |
|---|---|---|
| Chief Officers | 2.5x base salary | 5 years to comply; RSUs count; must hold all newly granted equity until compliant; all NEOs meet or are on track |
Employment Terms
Termination Scenarios, Approved Separation, and Retirement
- Approved Separation: Eligible at age 55+ and ≥5 years of service; upon approved resignation, MPC PSUs/RSUs and MPLX phantom units become nonforfeitable if held ≥6 months and with requisite notice (3 months for 2023–2024 grants; 6 months for 2022 grants; Committee may waive notice). Taxes are immediately due; awards are reduced to cover taxes but continue to distribute on original vest dates .
- Retirement Eligibility: Hessling is retirement-eligible (age ≥50 and ≥10 years vesting service) . Mandatory retirement at age 65 absent Board waiver .
Change-in-Control Economics (Double Trigger)
| Scenario | Severance | Life/Health Insurance Benefits | Total |
|---|---|---|---|
| CIC with Qualified Termination | $3,847,500 | $35,689 | $3,883,189 |
| Death | — | $1,350,000 | $1,350,000 |
| Resignation/Involuntary Termination (non-CIC) | — | — | — |
- Implicit Severance Multiple: Base salary $675,000 and target bonus $607,500 (90%) → Salary+Target Bonus $1,282,500; CIC severance $3,847,500 ≈ 3.0x of salary+target bonus .
- LTI under CIC: PSUs paid based on actual performance to CIC date and target thereafter; double-trigger vesting applies to LTI .
- Clawback: NYSE-compliant clawback recovers excess incentive-based comp over prior 3 fiscal years upon restatement; in addition to Sarbanes-Oxley §304 .
- Anti-hedging/pledging policy; no excise tax gross-ups; no dividend equivalents on unvested awards; discontinued option grants .
Deferred Compensation and Pension
| Plan | Company Contributions in 2024 ($) | Aggregate Earnings in 2024 ($) | Aggregate Balance at FY-End ($) |
|---|---|---|---|
| Executive Deferred Compensation Plan | $62,418 | $89,467 | $418,795 |
| Deferred Compensation Plan | — | $34,678 | $173,919 |
| Excess Benefit Plan | — | $1,806 | $87,774 |
| MPC 2021 Incentive Compensation Plan | — | $13,732 | $19,180 |
| MPLX LP 2018 Incentive Compensation Plan | — | $53,000 | $67,070 |
| Pension – Retirement Plan (Credited Service, PV) | 34.58 years; $1,446,573 PV | — | — |
Investment Implications
- High at-risk, performance-tied pay mix: 56% of other NEO compensation is performance-based, with PSUs at 60% of LTI and ACB weighted to financial outcomes (EBITDA-per-barrel, EBITDA, MPLX DCF/unit, cost discipline); strong TSR-linked PSUs and 2022 cycle payout of 183.33% indicate tight alignment with shareholder value creation .
- Vesting calendar and sell-to-cover dynamics: Significant RSU and MPLX phantom unit vesting on March 1 in 2025–2027 may drive routine withholding/sell-to-cover activity; awards becoming nonforfeitable under Approved Separation trigger immediate tax obligations and award reductions, which can create predictable liquidity events rather than discretionary sales .
- Retention/exit economics: CIC severance equals ~3x salary+target bonus with health benefits; double-trigger LTI vesting reduces forced exit risk in a transaction while preserving alignment; retirement eligibility and Approved Separation terms improve retention but also provide orderly exit pathways without forfeiture .
- Alignment and governance: Strict stock ownership guidelines (2.5x salary for Chief Officers), anti-hedging/pledging, and clawback policy mitigate misalignment and risk-taking; no shares or units are pledged, and option grants have been discontinued, limiting repricing risk .
- Performance drivers: ACB metrics linked to peer-relative profitability and MPLX cash flow create direct incentives to sustain commercial execution; 2024 results show mixed absolute EBITDA vs target but strong peer-relative and MPLX outcomes, resulting in a 156.34% bonus payout for Hessling .