UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

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Exchange Act of 1934 (Amendment No. )

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DEAR STOCKHOLDERS,

On behalf of the Board of Directors, we are pleased to invite you to attend Occidental’s 2017 Annual Meeting of Stockholders, which will be held at the Occidental Petroleum Conference Center, 5 Greenway Plaza, Houston, Texas 77046, on Friday, May 12, 2017, at 9:00 a.m.

Before the meeting begins, there will be an opportunity to meet informally with members of Occidental’s management team. As in the past, there will be a report on operations and an opportunity for you to ask questions at the meeting.

2016 was a significant year for Occidental, as we continued the strategic review started in 2013 and focused our organization on areas where we have sustainable competitive advantages due to our portfolio, technology and people. Despite the challenging commodity price environment, we grew our production from ongoing operations, successfully executed major long-term projects and meaningfully lowered our production costs while demonstrating our commitment to the dividend.

Looking ahead, we will remain committed to disciplined capital allocation. While recent improvements in oil prices are encouraging, we will stay focused on cost improvements and operating efficiencies. Our goal is to grow profitably and safely.

A meeting agenda and details follow, as well as voting instructions. We encourage you to vote promptly so that your shares will be represented and properly voted at the meeting.

	Sincerely,
	Vicki Hollub	Eugene L. Batchelder
	President and Chief Executive Officer	Chairman of the Board

2017 ANNUAL MEETING

  Notice of Annual Meeting of Stockholders

Occidental’s 2017 Annual Meeting of Stockholders will be held at 9:00 a.m. on Friday, May 12, 2017, at the Occidental Petroleum Conference Center, 5 Greenway Plaza, Houston, Texas 77046.

At the meeting, stockholders will act on the following matters and consider all other matters properly brought before the meeting:

Stockholders of record at the close of business on March 14, 2017 are entitled to receive notice of, attend and to vote at the meeting. Admittance to the meeting will require an admission ticket. Please see “Admission to the Annual Meeting” on page 66 for details.

Whether you plan to attend the meeting or not, it is important that you vote by following the Internet or telephone instructions provided in the Notice of Internet Availability. If you received a paper copy of the proxy materials or a voting instruction form, you may also vote by marking, signing and returning the proxy or voting instruction card in the envelope provided. This will ensure that your shares are represented and will save Occidental additional expenses of soliciting proxies.

By Order of the Board,

H. Elliott Heide
Vice President and Corporate Secretary

Occidental Petroleum Corporation
5 Greenway Plaza, Suite 110
Houston, Texas 77046

TABLE OF CONTENTS

PROXY STATEMENT SUMMARY

 

This section highlights certain important information presented in this Proxy Statement and is intended to assist you in evaluating the matters to be voted on at the meeting. We encourage you to read the Proxy Statement in its entirety before you cast your vote. For more information regarding Occidental’s 2016 performance, please review Occidental’s Annual Report on Form 10-K for the year ended December 31, 2016 (the Annual Report).

 

Matters to be Voted on

 

				Board Vote Recommendation		Page Reference (for more detail)
Proposal 1:		Election of Directors		FOR each Director Nominee		9
Proposal 2:		Advisory Vote Approving Executive Compensation		FOR		52
Proposal 3:		Advisory Vote on the Frequency of Future Advisory		FOR every ONE		54
		Votes Approving Executive Compensation		year
Proposal 4:		Ratification of the Selection of the Independent Auditors		FOR		55
Proposals 5-8:		Stockholder Proposals		AGAINST		57

 

Corporate Governance Highlights

 

The Board of Directors is committed to strong corporate governance policies and practices and continually reviews evolving best practices in governance and seeks input on governance matters from Occidental’s stockholders. Occidental’s corporate governance highlights, which are discussed in more detail beginning on page 16, include:

 

■	Independent Chairman of the Board		■	Policy prohibiting hedging of Occidental’s common stock
■	Annual elections of the entire Board		■	Stockholder right to proxy access
■	Majority voting for directors and, in uncontested elections, mandatory resignation if a majority vote is not received		■	Ability of stockholders to act by written consent
■	Standing Board committees comprised entirely of independent directors		■	Ability of stockholders to call special meetings
■	Annual evaluation of the Board and its committees		■	No stockholder rights (poison pill) or similar plan
■	Director retirement age policy of 75		■	Demonstrated commitment to Board refreshment
■	Meaningful stock ownership guidelines for directors and executive officers		■	Confidential Voting Policy

 

How to Vote

 

You can vote by any of the following methods:

 

ONLINE			CALL			MAIL			IN PERSON
	Online using your smartphone or computer at www.proxyvote.com			By telephone call to 1-800-690-6903			Completing, signing and returning your proxy or voting instruction card in the postage-paid envelope			If you plan to attend the Annual Meeting in person, you must request an admission ticket. Please see page 66 for details regarding how to request an admission ticket, and materials you must bring with you to the Annual Meeting.

 

 

 

 

Occidental Petroleum Corporation   5

Director Nominees

 

Committee Memberships

Name

Principal Occupation

Director since

Independent

Spencer Abraham

Chairman and Chief Executive Officer, The Abraham Group LLC

2005

Howard I. Atkins

Former Senior Executive Vice President and Chief Financial Officer, Wells Fargo

2010

Eugene L. Batchelder

Former Senior Vice President and Chief Administrative Officer, ConocoPhillips

2013

John E. Feick

Chairman, Matrix Solutions Inc.

1998

Margaret M. Foran

Chief Governance Officer, Senior Vice President and Corporate Secretary, Prudential Financial

2010

Carlos M. Gutierrez

Co-Chair, Albright Stonebridge Group

2009

Vicki Hollub

President and Chief Executive Officer, Occidental

2015

William R. Klesse

Former Chief Executive Officer and Chairman of the Board, Valero Energy

2013

Jack B. Moore

Former President and Chief Executive Officer, Cameron International

2016

Avedick B. Poladian

Former Executive Vice President and Chief Operating Officer, Lowe Enterprises

2008

Elisse B. Walter

Former Chairman, U.S. Securities and Exchange Commission

2014

		Chair		Audit Committee		Corporate Governance, Nominating and Social Responsibility

Member

Environmental, Health and Safety Committee

Executive Compensation Committee

 

Composition Highlights of Director Nominees

 

The Board of Directors annually evaluates the Board’s standing committees and the overall Board to assess, among other things, whether the Board is functioning effectively and possesses the necessary diversity of skills, backgrounds and experiences to meet Occidental’s needs.

 

INDEPENDENCE	TENURE	GENDER DIVERSITY
Occidental requires that at least two-thirds of its Board members must be independent. All of the director nominees are independent, except Ms. Hollub. All standing committees of the Board are composed entirely of independent directors.	The average tenure of the director nominees is approximately seven years, which reflects a balance of company experience and new perspectives. In 2016, Occidental’s board appointed a new director, Mr. Moore, who has over thirty years of experience in the energy industry.	The Board is committed to achieving a diverse and broadly inclusive membership. 3 of our 11 director nominees are women.

 

 

 

 

2017 Notice of Annual Meeting and Proxy Statement   6

2016 Business Performance Highlights

 

(for more detail, please see the Annual Report)

 

Despite the challenging commodity price environment, Occidental significantly reduced its operating costs while increasing Occidental’s worldwide production from ongoing operations. Occidental demonstrated its commitment to the dividend as the Board increased the dividend by $0.04 per share on an annualized basis. Management successfully continued the strategic review it started in 2013, and international operations are now focused on four core countries where Occidental has decades of experience – Oman, Qatar, and the United Arab Emirates in the Middle East and Colombia in Latin America.

 

SPENDING LESS	PRODUCING MORE	DIVIDEND COMMITMENT
Total spend per barrel (TSPB), an operational efficiency metric Occidental uses to calculate overhead, operating and capital cost per barrel of production, fell over 30% in 2016, from $40.24 in 2015, to $28.37. This represents a decrease in TSPB of over 50% since 2014.	Occidental’s production from ongoing operations grew from 565,000 barrels of oil equivalent (BOE) per day in 2015, to 602,000 BOE per day in 2016, an increase of approximately 7%.	In 2016, for the fourteenth consecutive year, Occidental’s Board of Directors increased the dividend, returning $2.3 billion to Occidental’s stockholders in 2016.

 

Executive Compensation Program

 

In 2016, the Compensation Committee strived to develop a compensation program designed not only to be consistent with industry practice, but also to attract and retain outstanding executives by providing incentives to reward them for superior performance that supports Occidental’s long-term strategic objectives. The 2016 executive compensation program is intended to:

 

	Be highly aligned with stockholder interests;
	Preserve performance accountability in both strong and weak commodity price environments;
	Build long-term share ownership;
	Provide a consistent retention incentive;
	Simplify the executive compensation program;
	Address the recent need to grant one-time awards, which are intended only for exceptional circumstances; and
	Match or exceed prevailing governance standards for performance-based compensation.

 

The 2016 executive compensation program is described in detail in the Compensation Discussion and Analysis section, beginning on page 20.

 

 

 

 

Occidental Petroleum Corporation   7

Elements of Executive Compensation

 

Consistent with Occidental’s philosophy on executive compensation, the majority of named executive officer compensation is performance-based, and can only be realized if Occidental meets applicable performance goals. The allocation of the compensation elements in 2016 to the named executive officers is shown below and is based on compensation as reported in the Summary Compensation Table (see page 37).

 

ALLOCATION OF COMPENSATION ELEMENTS IN 2016⁽¹⁾

 

 

(1)

Amounts shown reflect salary paid in 2016, Annual Cash Incentive awards for 2016, which were paid in 2017 based on 2016 performance, and the grant date value of the Long-Term Incentive awards granted in 2016. The compensation arrangements of Mr. Stephen I. Chazen, the former Chief Executive Officer, were the result of an agreement between Mr. Chazen and the Board and were unique to him. As a result, Mr. Chazen’s compensation is not included.

 

Highlights of Executive Compensation Program Policies and Practices

 

The executive compensation program for the named executive officers includes many best-practice features that are intended to enhance the alignment of compensation with the interests of Occidental’s stockholders:

 

What We Do			What We Don’t Do
	Majority of named executive officer compensation linked to performance			No automatic single-trigger vesting of equity awards in the event of a change-in-control
	Long-term incentive awards payable solely in shares of common stock			No individual change-in-control contracts
	Objective TSR metric underlying the performance-based portion of the long-term incentive award aligned with stockholder interests			No backdating or repricing of stock options
	Meaningful stock ownership guidelines for executive officers			No payout of the TSR award if Occidental’s TSR ranks in the bottom quarter of the peer group
	Golden Parachute Policy capping golden parachute payments in excess of 2.99 times base salary and bonus, unless approved by stockholders			No hedging of Occidental’s stock
	Clawback provisions in the 2015 Long-Term Incentive Plan and the plan underlying the Annual Cash Incentive for misconduct			No “golden coffin” provisions
	Independent Compensation Consultant Policy requiring that the compensation consultant be independent from management			No individual supplemental executive retirement arrangements

 

 

 

 

2017 Notice of Annual Meeting and Proxy Statement   8

Director Nominees

The Board of Directors is nominating the eleven individuals identified below for election as directors. Unless you specify differently, proxies received will be voted FOR Spencer Abraham, Howard I. Atkins, Eugene L. Batchelder, John E. Feick, Margaret M. Foran, Carlos M. Gutierrez, Vicki Hollub, William R. Klesse, Jack B. Moore, Avedick B. Poladian and Elisse B. Walter to serve for a one-year term ending at the 2018 Annual Meeting, but in any event, until his or her successor is elected and qualified, unless ended earlier due to his or her death, resignation, disqualification or removal from office. All of the nominees are currently directors of Occidental who were elected by stockholders at the 2016 Annual Meeting, except for Mr. Moore, who was appointed to the Board of Directors in July 2016. In the event any nominee should be unavailable to serve at the time of the meeting, the proxies may be voted for a substitute nominee selected by the Board of Directors or the Board of Directors may reduce the number of directors to eliminate the vacancy.

Election Requirements

Pursuant to Occidental’s by-laws, in an uncontested election, directors are elected by the majority of votes cast with respect to such director, meaning that the number of votes cast “for” a director must exceed the number of votes cast “against” that director. Your broker may not vote your shares on this proposal unless you give voting instructions. Abstentions and broker non-votes have no effect on the vote. Any director who receives a greater number of votes “against” his or her election than votes “for” in an uncontested election must tender his or her resignation. Unless accepted earlier by the Board of Directors, such resignation will become effective on October 31^st of the year of the election.

Director Independence

The Board of Directors has determined that all director nominees, other than Ms. Hollub, meet the independence standards set forth in the New York Stock Exchange (NYSE) Listed Company Manual. All committees of the Board are currently composed entirely of independent directors.

About the Director Nominees

Biographical information with respect to each of the director nominees, together with a discussion of each nominee’s experience, qualifications and attributes or skills that led to the conclusion that such person should serve as a director, is presented below.

The Board of Directors recommends a vote FOR all of the nominees.

Occidental Petroleum Corporation   9

SPENCER ABRAHAM   Director since 2005 | Age 64 | Independent   Committees:   ■  Environmental, Health and Safety   ■  Executive Compensation

Secretary Abraham is Chairman and Chief Executive Officer of The Abraham Group LLC, an international strategic consulting firm based in Washington, D.C. As a Senior Analyst for Potomac Research Group, Secretary Abraham provides predictive analysis on energy policy, energy markets and the geopolitics of energy to institutional investors in the energy space. He represented Michigan in the United States Senate prior to President George W. Bush selecting him as the 10^th Secretary of Energy in U.S. history. During his tenure at the Energy Department from 2001 through January 2005, he developed policies and regulations to ensure the nation’s energy security, was responsible for the U.S. Strategic Petroleum Reserve, oversaw domestic oil and gas development policy and developed relationships with international governments, including members of the Organization of the Petroleum Exporting Countries. Secretary Abraham serves as a Director of PBF Energy Inc., where he serves on the Compensation and Nominating and Corporate Governance Committees; NRG Energy, Inc., where he serves on the Compensation and Nuclear Oversight Committees; Two Harbors Investment Corp., where he is Chairman of the Compensation Committee and a member of the Nominating and Corporate Governance Committee; and as Chairman of the Board of Uranium Energy Corp. He was previously a Director of GenOn Energy, Inc. and a Director and a member of the Nominating and Governance and Compensation Committees of ICx Technologies. He also serves on the board of C3 Energy, a private company. Secretary Abraham is a member of the Advisory Board of the Churchill Center, a member of the Board of Trustees of the California Institute of Technology, and is the Chairman of the American Task Force for Lebanon. He holds a Juris Doctor degree from Harvard Law School and is the author of “Lights Out!: Ten Myths About (and Real Solutions to) America’s Energy Crisis.”

Qualifications: Secretary Abraham’s nearly two decades of experience at the highest levels of domestic and international policy and politics shape the insights he brings to Occidental’s Board of Directors. As a former U.S. Senator and former U.S. Secretary of Energy who directed all aspects of the country’s energy strategy, Secretary Abraham provides the Board unique insight into public policy and energy-related issues. In addition, Secretary Abraham is a Harvard-educated attorney who, while directing the Energy Department, oversaw a budget of nearly $24 billion (FY 2005) and was responsible for the management of senior department personnel. Secretary Abraham’s legal training and his government service managing complex policy, personnel and strategic issues provide Occidental with exceptional knowledge and perspective in the areas of health, environment and safety, strategy and policy, personnel management and community relations.

HOWARD I. ATKINS   Director since 2010 | Age 66 | Independent   Committees:   ■  Audit   ■  Environmental, Health and Safety

Mr. Atkins retired as the Senior Executive Vice President and Chief Financial Officer of Wells Fargo & Company, where he was responsible for Wells Fargo’s financial management functions, investment portfolios, investor relations, capital management and corporate properties functions from 2001 to 2011. A 37-year veteran of the financial services industry, Mr. Atkins previously served as Executive Vice President and Chief Financial Officer of New York Life Insurance Company, Chief Financial Officer of Midlantic Corporation and Corporate Treasurer of Chase Manhattan Bank. Mr. Atkins previously served on the Board of Directors of Ingram Micro Inc., where he served as Chairman of the Human Resources Committee and as a member of the Audit Committee.

Qualifications: With his experience as Chief Financial Officer of Wells Fargo, one of the largest banking institutions in the United States, Mr. Atkins brings to the Board a deep understanding of financial oversight and accountability. In his nearly four decades in the financial services industry, Mr. Atkins has had responsibilities in the areas of financial reporting, tax management, asset-liability management, treasury, corporate development, investor relations and mergers and acquisitions.This experience provides the Board insight into financial management and analysis. Mr. Atkins’ financial acumen, combined with his senior management expertise provides the Board valuable perspective in helping to guide the fiscal management policies that further Occidental’s strategic business goals.

2017 Notice of Annual Meeting and Proxy Statement   10

EUGENE L. BATCHELDER   Director since 2013 | Age 69 | Independent Chairman since 2015   Committee:   ■  Corporate Governance, Nominating and Social Responsibility

Mr. Batchelder retired in 2012 as the Senior Vice President and Chief Administrative Officer at ConocoPhillips, an integrated global energy company. In this role, from 2009 until his retirement, he was responsible for global shared services, human resources, facilities, information technology, security, aviation, executive services, and corporate affairs, which included investor relations, corporate communications and contributions. Mr. Batchelder served as Senior Vice President and Chief Information Officer of ConocoPhillips from 2002 to 2009. Prior to the merger of Conoco and Phillips Petroleum in 2002, Mr. Batchelder was promoted to increasingly senior positions within Phillips Petroleum companies, including information technology and financial management positions. Mr. Batchelder is a Director of Laurel’s Army Foundation, a past trustee and current governor of the Oklahoma State University Foundation, and past president and board member of the Oklahoma State University Alumni Association. Mr. Batchelder holds a bachelor’s degree in Accounting from Oklahoma State University, is a certified public accountant (inactive) and a member of the American Institute of Certified Public Accountants.

Qualifications: With more than 40 years of experience in the energy industry, including two decades in senior executive management, Mr. Batchelder brings an in-depth understanding of key corporate issues, including financial management and information technology. Mr. Batchelder also has insight into human resources, including executive management succession planning and compensation and benefits.

JOHN E. FEICK   Director since 1998 | Age 73 | Independent   Committees:   ■  Environmental, Health and Safety (Chair)   ■  Corporate Governance, Nominating and Social Responsibility   ■  Executive Compensation

Mr. Feick is the Chairman and a significant stockholder of Matrix Solutions Inc., a provider of environmental remediation and reclamation services. Until 2011, he was Chairman and a significant stockholder of Kemex Engineering Services, Ltd., which offers engineering and design services to the petrochemical, refining and gas processing industries. From 1984 to 1994, Mr. Feick was President and Chief Operating Officer of Novacor Chemicals, a subsidiary of Nova Corporation. He previously served as Chairman of the Board of Directors of Oak Point Energy Ltd., an oil sands exploration and development company, and was a Director of Veresen Inc. and Graham Construction.

Qualifications: Mr. Feick possesses a deep understanding of both the oil and gas and chemicals industries along with broad experience in environmental compliance and remediation. He has served as President and Chairman of a company specializing in environmental services and served as Chairman of an oil and gas and petrochemicals specialty engineering firm. As President and Chief Operating Officer of Novacor Chemicals, he was responsible for the company’s investments and operations and established the company as a leader in plant reliability, utilization rates, occupational health and safety, and environmental performance in North America. In addition to industry knowledge and expertise, Mr. Feick’s experience brings the Board exceptionally valuable insight into the environmental, health and safety area.

Occidental Petroleum Corporation   11

MARGARET M. FORAN   Director since 2010 | Age 62 | Independent   Committees:   ■  Executive Compensation (Chair)   ■  Corporate Governance, Nominating and Social Responsibility

Ms. Foran is Chief Governance Officer, Senior Vice President and Corporate Secretary of Prudential Financial, Inc. Prior to joining Prudential, she was Executive Vice President, General Counsel and Corporate Secretary at Sara Lee Corporation from 2008 to 2009; Senior Vice President, Associate General Counsel and Corporate Secretary at Pfizer Inc. from 1997 to 2008; and Vice President and Assistant General Counsel at J.P. Morgan & Co. Ms. Foran is a former Director of The MONY Group Inc. and MONY Life Insurance Company. She served as Co-Chair and a Director of the Council of Institutional Investors (CII) and Co-Chair of the CII International Corporate Governance Committee. She is the former Chair of the American Bar Association Committee on Corporate Governance. Ms. Foran is the former Chair of the Coordinating Committee of the Business Roundtable Corporate Governance Task Force. She previously served two terms on the Standing Advisory Group of the Public Company Accounting Oversight Board (PCAOB) and is a member of the Economic Club of New York. Ms. Foran is a Trustee of the Committee for Economic Development, as well as a member of the Notre Dame Law School Advisory Council.

Qualifications: Ms. Foran is an accomplished attorney with deep expertise in legal affairs and corporate governance. She has held positions of increasing responsibility at four U.S.-based global companies, where for more than a decade she has had a leading role in strengthening corporate governance, environmental and sustainability principles and practices, ensuring regulatory compliance and developing programs to broaden investor communications. Having been a senior executive in the financial services, food and beverage and pharmaceutical industries, Ms. Foran has a broad range of experience in shareholder services, mergers and acquisitions, SEC reporting, capital markets, derivatives, risk management, internal audit procedures and insurance matters as well as environmental, safety and social responsibility programs. Ms. Foran’s corporate experience, in addition to her work with various investor groups and corporate trade associations, provides the Board exceptional acumen and insight on governance, investor and legal policies and practices.

CARLOS M. GUTIERREZ   Director since 2009 | Age 63 | Independent   Committees:   ■  Corporate Governance, Nominating and Social Responsibility (Chair)   ■  Audit

Secretary Gutierrez is Co-Chair of Albright Stonebridge Group, a commercial diplomacy and strategic advisory firm. Prior to that he was Vice Chairman of the Institutional Clients Group and a member of the Senior Strategic Advisory Group at Citigroup Inc. from 2011 to February 2013. He joined Citigroup from communications and public affairs consulting firm APCO Worldwide Inc., where he was Chairman of the Global Political Strategies division in 2010. He served as U.S. Secretary of Commerce in the administration of President George W. Bush from February 2005 to January 2009. Prior to his government service, Secretary Gutierrez was with Kellogg Company for 30 years. He became Kellogg’s Chief Executive Officer in 1999 and served as Chairman of the Board from 2000 to 2005. Secretary Gutierrez serves on the Board of Directors of MetLife, Inc., where he serves on the Finance and Investment and Governance Committees, Time Warner Inc., where he serves on the Audit Committee, and Viridis, Inc., a privately held company. He previously served as a Director of Corning Incorporated, United Technologies Corporation, Colgate-Palmolive Lighting Science Group Corp., where he served on the Audit Committee, and iGPS, a privately held company. In addition to serving as Chairman of the U.S.-Cuba Business Council of the U.S. Chamber of Commerce, Secretary Gutierrez is a member of the Human Freedom Advisory Council at the George W. Bush Institute and is Chairman of the Board of Trustees of the Meridian International Center. He is also a co-founder of The Dream.US, a scholarship fund for undocumented students, and is a member of the Board of the U.S.-Mexico Foundation.

Qualifications: Secretary Gutierrez’s highly successful service as Chief Executive Officer and Chairman of Kellogg Company provides him deep insight into the complex challenges faced by a growing organization in a highly competitive business environment. Additionally, his experience as U.S. Secretary of Commerce provides the Board exceptional knowledge and insight into the complex environment of international commerce. Secretary Gutierrez brings valuable business management and operational experience and an international commerce and global economic perspective to the Board.

2017 Notice of Annual Meeting and Proxy Statement   12

VICKI HOLLUB   Director since 2015 | Age 57

Ms. Hollub has held the position of President and Chief Executive Officer of Occidental since April 2016 and has been a member of the Board of Directors since December 2015. Ms. Hollub has been an employee of Occidental for over 35 years, and has held a variety of technical and leadership roles, both domestic and international, over the course of her career. Ms. Hollub most recently served as President and Chief Operating Officer from December 2015 to April 2016 and Senior Executive Vice President and President – Oxy Oil and Gas from May 2015 to December 2015. Prior to that, Ms. Hollub served as Executive Vice President and President – Oxy Oil and Gas, Americas; Vice President and Executive Vice President, U.S. Operations, Oxy Oil and Gas; and as Executive Vice President, California Operations. Ms. Hollub serves on the boards of the American Petroleum Institute and Khalifa University for Science and Technology in Abu Dhabi. A graduate of the University of Alabama, Ms. Hollub holds a B.S. in Mineral Engineering. She was inducted into the University of Alabama College of Engineering 2016 class of Distinguished Engineering Fellows.

Qualifications: As Occidental’s President and Chief Executive Officer, Ms. Hollub is responsible for Occidental’s operations, strategy, and financial management. Ms. Hollub brings to the Board over 35 years of experience in the oil and gas industry, including extensive international experience, having previously held a variety of management and technical roles on three continents, including roles in Russia, Venezuela and Ecuador. Throughout her tenure at Occidental, Ms. Hollub has been instrumental in efficiently and profitably growing Occidental’s oil and gas business. Ms. Hollub’s extensive leadership and operational experience brings valuable perspective to the Board.

WILLIAM R. KLESSE   Director since 2013 | Age 70 | Independent   Committees:   ■  Environmental, Health and Safety   ■  Executive Compensation

Mr. Klesse is the former Chief Executive Officer and former Chairman of the Board of Valero Energy Corporation, an international manufacturer and marketer of transportation fuels, other petrochemical products and power. He joined the Valero board as Vice Chairman in 2005 and served as Chairman of the Board from 2007 to December 2014. From 2006 to May 2014, he served as Chief Executive Officer of Valero and served as President from 2008 to 2013. From 2003 to 2005, Mr. Klesse was Valero’s Executive Vice President and Chief Operating Officer. Prior to that, he served as Executive Vice President of Refining and Commercial Operations following Valero’s 2001 acquisition of Ultramar Diamond Shamrock Corporation, where he had been Executive Vice President of the company’s refining operations. Mr. Klesse began his 40-plus year career in the energy industry at Diamond Shamrock Corporation, which merged with Ultramar Corporation in 1996. Mr. Klesse serves on the Board of Directors of MEG Energy. Mr. Klesse is a trustee of the Texas Biomedical Research Institute and United Way of San Antonio and Bexar County and serves on the Advisory Board of the San Antonio Food Bank. Mr. Klesse holds a bachelor’s degree in Chemical Engineering from the University of Dayton and a Master of Business Administration with an emphasis in Finance from West Texas A&M University.

Qualifications: Mr. Klesse brings more than four decades of energy industry executive management experience to Occidental’s Board. As Valero’s former Chairman, he led the Board’s strategic planning and, as Valero’s former Chief Executive Officer, he oversaw the daily operations of a major global energy company. Mr. Klesse’s experience provides an informed management perspective and insights with respect to global business and energy issues to the Board. He also has leadership experience on industry association and nonprofit boards.

Occidental Petroleum Corporation   13

JACK B. MOORE   Director since 2016 | Age 63 | Independent   Committees:   ■  Environmental, Health and Safety   ■  Executive Compensation

Mr. Moore most recently served as President and Chief Executive Officer of Cameron International Corporation from April 2008 to October 2015 and served as Chairman of the Board of Cameron from May 2011 until it was acquired by Schlumberger in April 2016. Mr. Moore served as Cameron’s President and Chief Operating Officer from January 2007 to April 2008. Mr. Moore joined Cameron in 1999 and, prior to that, Mr. Moore held various management positions at Baker Hughes Incorporated, where he was employed for over 20 years. Mr. Moore serves on the Board of Directors of Rowan Companies plc, where he serves on the Compensation and Health, Safety and Environment committees, ProPetro Holding Corp., where he serves on the Nominating and Corporate Governance committee, and KBR Inc., where he serves on the Compensation and Nominating and Corporate Governance committees. Mr. Moore actively serves in leadership positions within the Petroleum Equipment and Services Association, the University of Houston, the United Way of Greater Houston and Memorial Assistance Ministries. Mr. Moore is a graduate of the University of Houston with a B.B.A. degree and attended the Advanced Management Program at Harvard Business School.

Qualifications: Mr. Moore brings over 35 years of energy industry experience to Occidental’s Board and has a deep understanding of oil and gas operations. As a former Chief Executive Officer and Board Chairman, Mr. Moore has extensive executive management and leadership experience, and is knowledgeable in the areas of strategic planning, financial management, mergers and acquisitions and executive compensation. Mr. Moore also has leadership experience on industry association and nonprofit boards.

AVEDICK B. POLADIAN   Director since 2008 | Age 65 | Independent   Committees:   ■  Audit (Chair)   ■  Corporate Governance, Nominating and Social Responsibility

Mr. Poladian is a Director and the former Executive Vice President and Chief Operating Officer of Lowe Enterprises, Inc., a privately-held diversified national real estate company active in commercial, residential and hospitality property investment, management and development. Mr. Poladian served in this position from December 2002 to December 2016, and is currently an advisor to the company. During his tenure as Chief Operating Officer, Mr. Poladian oversaw human resources, risk management, construction, finance and legal functions across the firm. Mr. Poladian was with Arthur Andersen from 1974 to 2002 and is a certified public accountant (inactive). He is a past member of the Young Presidents Organization, the Chief Executive Organization, the California Society of CPAs and the American Institute of CPAs. Mr. Poladian is a Director of the YMCA of Metropolitan Los Angeles, a member of the Board of Councilors of the University of Southern California School of Policy, Planning, and Development, a member of the Board of Advisors of the Ronald Reagan UCLA Medical Center, and a former Trustee of Loyola Marymount University. Mr. Poladian serves as a Director and on the Audit Committees of two funds managed by Western Asset Management Company. He also serves as a Director of California Resources Corporation, and as a member of the Board of Trustees of Public Storage, where he is the Chair of the Audit Committee and the Chair of the Nominating/Corporate Governance Committee.

Qualifications: As a certified public accountant with extensive business experience, Mr. Poladian qualifies as one of Occidental’s Audit Committee financial experts and provides the Board expert perspective in financial management and analysis. Having served in a senior management position at one of the world’s largest accounting firms, combined with his experience as Chief Operating Officer and Chief Financial Officer of a diversified real estate company, Mr. Poladian has deep knowledge of key business issues, including personnel and asset utilization, in addition to all aspects of fiscal management.

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ELISSE B. WALTER   Director since 2014 | Age 66 | Independent   Committees:   ■  Audit   ■  Environmental, Health and Safety

Ms. Walter was appointed Commissioner of the U.S. Securities and Exchange Commission (SEC) by President George W. Bush, and served in that capacity from 2008 until 2013. President Barack Obama designated her as the 30^th Chairman of the SEC in December 2012. Prior to her appointment as an SEC Commissioner, she was with the Financial Industry Regulatory Authority (FINRA) and its predecessor, the National Association of Securities Dealers (NASD), from 1996-2008. She served as Senior Executive Vice President, Regulatory Policy and Programs for FINRA and held the comparable position at NASD before its 2007 consolidation with NYSE Member Regulation. Earlier in her career, she served as the General Counsel of the Commodity Futures Trading Commission (CFTC) from 1994 to 1996 and as Deputy Director of the SEC Division of Corporation Finance from 1986 to 1994. Among the honors Ms. Walter has received are the Presidential Rank Award (Distinguished), the ASECA William O. Douglas Award, the SEC Chairman’s Award for Excellence and the Federal Bar Association’s Philip A. Loomis, Jr. and Manuel F. Cohen Awards. She is a member of the Academy of Women Achievers of the YWCA of the City of New York and the inaugural class of the DirectWomen Institute. She serves on the Board of Directors of the Sustainability Accounting Standards Board, the National Women’s Law Center and the Board of Governors of FINRA. Ms. Walter holds a B.A. in Mathematics, cum laude, from Yale University and a J.D., cum laude, from Harvard Law School.

Qualifications: Ms. Walter’s long and distinguished record of public service in major leadership roles at key agencies of the federal government has given her unique insight into both business and government. She also brings to the Board more than 35 years of experience and insight on complex domestic and international regulatory matters. As Chairman of the SEC, Ms. Walter demonstrated a keen understanding of capital markets and related regulatory issues, and led a 4,000-employee federal agency, overseeing its budget and developing policy. Ms. Walter’s experience at FINRA provides extensive knowledge with respect to corporate finance and financial regulation and disclosure and her CFTC experience brings to the Board an understanding of commodities markets and regulation.

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CORPORATE GOVERNANCE

The Board of Directors is committed to strong corporate governance policies and practices. The Board continually reviews evolving best practices in governance and seeks input from Occidental’s stockholders through Occidental’s ongoing stockholder engagement program. Occidental’s Corporate Governance Policies and Code of Business Conduct, together with information about other governance measures adopted by the Board of Directors and the charters of the four standing Board committees are available at www.oxy.com/Investors/Governance, or by writing to Occidental’s Corporate Secretary.

Corporate Governance Highlights

Board of Directors and its Committees

Occidental is governed by the Board of Directors and its four standing committees. The structure and roles of the Board and its committees are described below.

  Board Leadership Structure

Occidental’s by-laws provide for the Board to annually elect one of its independent directors to be Chairman of the Board to serve as a liaison between the Board and Occidental’s stockholders. In 2016, the Board elected Mr. Batchelder to serve in that position. The Chairman of the Board presides at meetings of stockholders and the Board and has the authority to, among other things:

Another key component of the Board’s leadership structure is the role of the Board committees. These committees regularly report specific findings and make recommendations to the full Board in their areas of oversight.

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  Board Committees

To simplify its committee structure, Occidental’s Board of Directors dissolved its Finance and Risk Management Committee and its Management Succession and Talent Development Committee in 2016, and the responsibilities of those committees were reassigned to the other standing committees or the full Board, as appropriate. The standing committees are composed solely of independent directors. The primary responsibilities of the committees are described below. From time to time, the Board of Directors delegates additional duties to the standing committees.

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  Board and Independent Director Meetings

The Board of Directors held six regular meetings during 2016. Mr. Batchelder, as Chairman of the Board, presided over the Board’s executive sessions. In 2016, each director, except for Mr. Moore, attended at least 75 percent of the total number of Board and Board committee meetings, on which he or she served, held during his or her tenure. Mr. Moore attended all meetings of the Board and Board committees on which he served following his appointment to the Board in July 2016 other than the December 2016 Board and committee meetings, which he was unable to attend due to a pre-existing conflict known to the Board at the time of his appointment. All of the directors serving at the time attended the 2016 Annual Meeting of Stockholders. Attendance at the Annual Meeting of Stockholders is expected of directors as if it were a regular meeting of the Board.

  Risk Oversight

The Board’s role in risk oversight recognizes the multifaceted nature of risk management. It is a control and compliance function, but it also involves strategic considerations in normal business decision making. It covers legal and regulatory matters, finance, security, cybersecurity, safety, health and environmental concerns.

The Board has empowered its committees with risk oversight responsibilities. The Audit Committee, the Governance Committee and the Environmental, Health and Safety Committee, all composed entirely of independent directors, are each integral to the control and compliance aspects of risk oversight by the Board. Each of these committees meets regularly with management to review, as appropriate, compliance with existing policies and procedures and to discuss changes or improvements that may be required or desirable. Each of the committees with risk oversight responsibilities meets several times each year. This ensures that each committee has adequate time for in-depth review and discussion of all matters associated with each committee’s area of responsibility. After the committee meetings, each committee reports to the Board, sometimes without the Chief Executive Officer present, for discussion of issues and findings, as well as the Board’s recommendations of appropriate changes or improvements.

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Other Governance Matters

  Stockholder Nominations of Director Candidates

Occidental’s by-laws permit a group of up to 20 stockholders, collectively owning 3% or more of Occidental’s outstanding common stock continuously for at least three years, to nominate and include in Occidental’s proxy materials directors constituting up to 20% of the Board, but not less than two directors, provided that the stockholder(s) and the nominee(s) meet the requirements of the by-laws. For more information on proxy access and other procedures to recommend or nominate candidates to Occidental’s Board of Directors, see “Nominations for Directors for Term Expiring in 2019” on page 68.

  Related Party Transactions

Pursuant to Occidental’s written Conflict of Interest Policy and Code of Business Conduct, each director and executive officer has an obligation to avoid any activity, agreement, business investment or interest, or other situation that could be construed either as divergent to or in competition with Occidental’s interest or as an interference with such person’s primary duty to serve Occidental, unless prior written approval has been granted by the Audit Committee of the Board of Directors. All potential conflicts of interest must be reported to a designated compliance officer. In addition, each director and executive officer is required to complete an annual questionnaire that requires disclosure of any transaction between Occidental and the director or executive officer or any of his or her affiliates or immediate family members. In 2016, there were no related party transactions in which Occidental or its subsidiaries were participants and in which any director or executive officer of Occidental had a direct or indirect material interest.

A summary of the Conflict of Interest Policy is included in Occidental’s Code of Business Conduct which can be found at www.oxy.com/Investors/Governance.

  Board Evaluation Process

Led by the Governance Committee, the Board of Directors conducts a robust annual evaluation of its performance as well as the performance of each of the Board’s committees. In two of the last three years, the Governance Committee has engaged a third-party facilitator to assist in the evaluation process, which included director interviews. The evaluations in 2016 included written questions, individual director self-assessments and the use of a skills matrix. The findings of the evaluations are presented to the full Board and are used to identify Board and committee strengths and areas capable of improvement, as well as to identify skills or expertise that may be used as criteria when the Board considers director candidates.

  Director Education

Directors are provided with continuing education, including business-specific learning opportunities through site visits and briefing sessions on topics that are relevant to Occidental. Directors are also encouraged to attend additional continuing education programs designed to enhance the performance of individual directors and the Board of Directors. In 2016, directors participated in various corporate director and compliance programs held by universities and corporate director, governance, legal and investor professional organizations, including the NYSE and the National Association of Corporate Directors, as attendees or as presenters.

  Communications with Directors

Stockholders and other interested parties may communicate with any director by sending a letter to such director’s attention in care of Occidental’s Corporate Secretary, Occidental Petroleum Corporation, 5 Greenway Plaza, Suite 110, Houston, Texas 77046. The Corporate Secretary opens, logs and forwards all such correspondence (other than advertisements or other solicitations) to directors unless a director has requested the Corporate Secretary to forward correspondence unopened.

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COMPENSATION DISCUSSION AND ANALYSIS

Overview

This Compensation Discussion and Analysis (CD&A) describes the material elements, objectives and principles of Occidental’s executive compensation program, compensation decisions made in 2016 and the factors the Executive Compensation Committee (the Compensation Committee) considered in making those decisions.

Our named executive officers for 2016 appearing in this Proxy Statement are:

Highlights of Compensation Program Policies and Practices

The executive compensation program for the named executive officers includes many best-practice features that are intended to enhance the alignment of compensation with the interests of Occidental’s stockholders:

	What We Do			What We Don’t Do
	Majority of named executive officer compensation linked to performance			No automatic single-trigger vesting of equity awards in the event of a change-in-control
	Long-term incentive awards payable solely in shares of common stock			No individual change-in-control contracts
	Objective TSR metric underlying the performance-based portion of the long-term incentive award aligned with stockholder interests			No backdating or repricing of stock options
	Meaningful stock ownership guidelines for executive officers			No payout of the TSR award if Occidental’s TSR ranks in the bottom quarter of the peer group
	Golden Parachute Policy capping golden parachute payments in excess of 2.99 times base salary and bonus, unless approved by stockholders			No hedging of Occidental’s stock
	Clawback provisions in the 2015 Long-Term Incentive Plan and the plan underlying the Annual Cash Incentive for misconduct			No “golden coffin” provisions
	Independent Compensation Consultant Policy requiring that the compensation consultant be independent from management			No individual supplemental executive retirement arrangements

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2016 Business Performance Highlights

In response to the weak commodity price environment that continued throughout 2016, Occidental maintained its focus on achieving operating efficiencies, cost reductions and economically growing production while maintaining an emphasis on the health and safety of its workforce and maximizing value for its stockholders. Occidental’s senior management team also continued its efforts to optimize the company’s portfolio of assets by reducing Occidental’s exposure in areas that offer less attractive returns, and expanding Occidental’s footprint in the Permian Basin with acquisitions that complement Occidental’s existing operations.

Management continued its focus on decreasing costs within its control and maximizing efficiencies throughout the year. Specifically, management was challenged to reduce its Total Spend per Barrel (TSPB) of oil equivalent sold to $28.50 in 2016, which represented an approximate 30% decrease from the prior year’s TSPB of $40.24, and a decrease of over 50% from the TSPB in 2014 of $61.65. The TSPB metric is intended to focus employees on realizing cost reductions, increasing well productivity and optimizing base production. For 2016, TSPB was the sole metric underlying the performance-based portion of the Annual Cash Incentive opportunity for the named executive officers other than Ms. Hollub, whose performance was measured against a basket of key performance metrics, including TSPB, and Mr. Chazen, who was not eligible for an Annual Cash Incentive.   Occidental’s TSPB for 2016 was $28.37, achieving the target TSPB set for 2016 of $28.50 or below.

In 2016, Occidental increased its production volumes from its ongoing operations by 7% over the prior year while reducing its capital expenditures and meaningfully lowering production costs year-over-year. The increases in production came from Occidental’s Permian Resources business unit, the Al Hosn Gas plant in the United Arab Emirates and Oman’s Block 62. Most production cost reductions were the result of sustainable efficiency gains.   Achieving production growth was an operational company objective underlying a portion of Ms. Hollub’s Annual Cash Incentive opportunity for 2016, as described beginning on page 26.

In July 2016, Occidental announced a dividend increase. The current annual dividend rate is $3.04 per share. Occidental’s senior management team views dividends as providing financial discipline, and funding the dividend is a cash flow priority. Through the dividend, Occidental returned $2.3 billion to stockholders in 2016.   Maintenance of financial discipline and a strong balance sheet were strategic company objectives underlying a portion of Ms. Hollub’s Annual Cash Incentive opportunity for 2016, as described beginning on page 26.

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Stockholder Approval of Executive Compensation and Ongoing Engagement

At the 2016 Annual Meeting, stockholders continued to express their support of Occidental’s executive compensation program, as approximately 96% of stockholders voted FOR Occidental’s advisory vote approving executive compensation. While the Compensation Committee interpreted this level of support as an endorsement of the 2015 executive compensation program by Occidental’s stockholders, the Compensation Committee ultimately determined that modifications to the executive compensation program were warranted in 2016, as discussed in more detail throughout this CD&A. During 2016, Occidental’s management continued to actively engage with stockholders, and expanded company-led engagement efforts with direct outreach to Occidental’s 50 largest stockholders representing a majority of shares of Occidental’s common stock outstanding. Topics discussed included matters related to Board composition and refreshment, executive compensation, the Chief Executive Officer transition and environmental, social and governance issues.

Executive Compensation Program Objectives

In 2016, the Compensation Committee strived to develop a compensation program designed not only to be consistent with industry practice, but also to attract and retain outstanding executives by providing incentives to reward them for superior performance that supports Occidental’s long-term strategic objectives, whether in an up- or down-cycle commodity price environment. The 2016 executive compensation program is intended to:

		Be highly aligned with stockholder interests;
		Preserve performance accountability in both strong and weak commodity price environments;
		Build long-term share ownership;
		Provide a consistent retention incentive;
		Simplify the executive compensation program;
		Address the recent need to grant one-time awards, which are intended only for exceptional circumstances; and
		Match or exceed prevailing governance standards for performance-based compensation.

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Compensation Program Considerations and Actions

In modifying the executive compensation program for the named executive officers in 2016 to meet the Compensation Committee’s objectives for the program, as discussed above, the Compensation Committee focused on the following key considerations and took responsive actions. In the current dynamic commodity price environment, the Compensation Committee continues to evaluate the optimal weightings and metrics underlying the long-term incentive program and the plan underlying the Annual Cash Incentive.

Consideration		Action
■  The absolute financial targets underlying the majority of the 2015 long-term incentive program and the Annual Cash Incentive award not accommodating a sharp and sustained decline in commodity prices, which have a substantial impact on Occidental’s financial performance. Under the 2015 executive compensation program, a significant majority of Occidental’s long-term incentive awards and the Annual Cash Incentive award were based on achieving absolute financial goals, which were largely dependent on the prices Occidental receives for its products. Meaningful targets with respect to these goals proved difficult to set in a volatile commodity price environment, as results were largely a reflection of commodity price movements.		■   Focus the long-term incentive program on relative Total Shareholder Return (TSR), rather than absolute financial targets, which incentivizes superior performance throughout the commodity price cycle. An emphasis on TSR preserves performance accountability in both strong and weak commodity price environments, and is aligned with stockholder interests. ■   The Compensation Committee retained a modifier on the TSR award that limits payout of the award to target if Occidental’s absolute TSR is negative over the performance period to align pay with performance.
■   The recent use of off-cycle, special awards to recognize performance and maintain an alignment of Occidental’s pay to its performance. In recent years, the Compensation Committee awarded supplemental long-term incentive awards to recognize operational excellence, incentivize retention, and to address the consequence of the collapse in commodity prices on outstanding long-term incentive awards, which had the effect of negating the value of many of the long-term incentive awards for reasons outside of management’s control.		■   The inclusion of a time-vesting restricted stock unit award in the long-term incentive program is intended, in part, to provide predictability to the program. The two-year holding period aligns the interests of the named executive officers with Occidental’s long-term stockholders. ■   The majority of the target long-term incentive award opportunity remains subject to performance-based vesting criteria (70% for Ms. Hollub and 55% for the other named executive officers).
■   Occidental’s CEO transition and the desire for a conventional, performance-based compensation strategy for its new CEO. Mr. Chazen was not eligible for an Annual Cash Incentive or Total Shareholder Return award in 2014, 2015 and 2016. These recent compensation arrangements were the result of an agreement between Mr. Chazen and the Board and were unique to him.		■   The Compensation Committee felt that it was appropriate for Ms. Hollub to be eligible for an Annual Cash Incentive award with the significant majority of the target value (80%) tied to company performance, with the remainder tied to an assessment of individual performance. ■   Ms. Hollub also participates in the long-term incentive program, and 70% of her target long-term incentive award is tied to creating value for the company’s stockholders through a TSR award.
■   Monitoring of compensation surveys, peer group data and other materials regarding executive officer compensation. The Compensation Committee regularly reviews compensation surveys, peer group data and other general and executive compensation materials shared or prepared by the Compensation Committee’s independent compensation consultant.		■   The Compensation Committee determined that the 2016 program matched or exceeded prevailing governance standards for performance-based compensation. ■   While the Compensation Committee does not benchmark pay for the executive officers to any specific level relative to peers, the Compensation Committee found that overall pay magnitude for the named executive officers was reasonable.

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Overview of the 2016 Compensation Program Elements

The majority of compensation for the named executive officers is based on the long-term performance of Occidental. The elements of our 2016 executive compensation program are summarized in the table below and are described further under “Elements of the 2016 Compensation Program” on page 26.

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Allocation of Compensation Elements

Consistent with Occidental’s philosophy on executive compensation, the majority of named executive officer compensation is performance-based, and can only be realized if Occidental meets applicable performance goals. The allocation of the compensation elements to the named executive officers in 2016 is shown below and is based on compensation as reported in the Summary Compensation Table (see page 37).

ALLOCATION OF COMPENSATION ELEMENTS IN 2016⁽¹⁾

Participants in the Decision-Making Process

Role of the Independent Compensation Committee. The Compensation Committee, comprised of independent members of the Board, is responsible for annually reviewing all aspects of the Chief Executive Officer’s compensation, as well as annually reviewing and approving the compensation of all other named executive officers. In performing these duties, the Compensation Committee obtains input, advice and information from senior management, members of Occidental’s Human Resources team and an independent compensation consultant, as further described below, throughout the year. The Compensation Committee also considers the views expressed by Occidental’s investors and stockholder advisory groups in making executive compensation decisions. The Compensation Committee uses publicly available data regarding the executive compensation practices of its peer group (defined below) as an additional tool, but does not benchmark executive compensation to a specific percentile within the peer group.

Role of Senior Management. The Chief Executive Officer made recommendations regarding the compensation package for each of the other named executive officers to the Compensation Committee. The Chief Executive Officer and the senior executive responsible for Human Resources were present for a portion of each of the Compensation Committee meetings, but were not present when compensation decisions regarding the Chief Executive Officer were discussed and made. The Chief Executive Officer’s compensation package is set only by the Compensation Committee. Senior members of the Human Resources team and other members of senior management interact with the compensation consultant as necessary and prepare materials for each Compensation Committee meeting to assist the Compensation Committee in its consideration of executive compensation programs and policies and its administration of plans and programs.

Role of the Independent Compensation Consultant. In 2016, Occidental participated in compensation surveys conducted by compensation consultants, including the Compensation Committee’s independent compensation consultant, in order to better understand general external compensation practices, including with respect to executive compensation. In 2016, the Compensation Committee engaged Meridian Compensation Partners, LLC (Meridian) as its compensation consultant to provide advice on various executive compensation matters. The Compensation Committee reviewed the independence of Meridian under the Securities and Exchange Commission rules, the New York Stock Exchange (NYSE) Listed Company Manual standards, and Occidental’s Independent Compensation Consultant Policy and found Meridian to be independent and without conflicts of interest.

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Role of Peer Companies. In order to evaluate and understand how Occidental’s executive compensation program compares within the oil and gas industry, particularly with respect to types of awards, performance metrics for awards and reported levels of compensation, the Compensation Committee reviewed information regarding oil and gas industry and peer company executive compensation practices, programs and data that were publicly disclosed or available. Additionally, the Compensation Committee reviewed and considered broad-based compensation surveys and related materials. The information was used merely as a reference and not to establish compensation benchmarks, as Occidental does not benchmark executive compensation to a specific percentile within the peer group.

Occidental’s peer group consists of the following companies:

The Compensation Committee also designated this group of companies as the peer group for purposes of the TSR awards granted in 2016.

Risk Assessment of Compensation Policies and Practices

Although the majority of the executive compensation program pay is performance-based, the Compensation Committee believes the program does not encourage unnecessary or excessive risk-taking. The Compensation Committee believes that any potential risk of the executive compensation program influencing behavior that could be inconsistent with the overall interests of Occidental and its stockholders is mitigated by several factors, including:

Elements of the 2016 Compensation Program

Salary and Other Annual Compensation. The Compensation Committee believes that overall executive compensation should include elements that reward executives on a market-competitive basis for consistent performance of job requirements and achievement of certain short-term goals, which, over time, contribute to long-term growth of stockholder value. Excluding Mr. Chazen, who had compensation arrangements unique to him, short-term compensation represented, on average, less than 30% of the 2016 compensation packages of the named executive officers, which is reflective of the Compensation Committee’s goal of emphasizing long-term compensation. Short-term compensation includes base salary, an Annual Cash Incentive award, perquisites and certain other annual compensation and employee benefits, which are described under “Other Compensation and Benefits” beginning on page 34. For a discussion regarding salary decisions for each named executive officer in 2016, please see “Individual Compensation Considerations” beginning on page 30.

Annual Cash Incentive. The Compensation Committee sets a target Annual Cash Incentive award amount for each of the named executive officers based on a review of commercially available compensation surveys, other publicly available information, internal pay equity and total compensation objectives. In addition, the Compensation Committee considers each executive’s ability to influence Occidental’s performance during the one-year performance period. The Annual Cash Incentive is composed of a company performance portion and an individual performance portion.

Company Performance. Payout of the company performance portion of the Annual Cash Incentive award is based on Occidental’s performance during the year as measured against an established company performance metric or set of metrics. In 2016, 80% of the Chief Executive Officer’s Annual Cash Incentive award was subject to a basket of key company performance metrics as described in more detail below. For the other named executive officers eligible for an Annual Cash Incentive award in 2016, the company performance portion of the Annual Cash Incentive award represented 60% of the target Annual Cash Incentive award opportunity, and achievement was measured against a Total Spend per Barrel (TSPB) target of $28.50, as described further below.

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The Compensation Committee determined that a basket of key performance metrics was appropriate to underlie Ms. Hollub’s company performance portion because, as Chief Executive Officer, her leadership directly affects all aspects of the company’s performance. In contrast, the Compensation Committee determined to limit the company performance metric underlying the Annual Cash Incentive award for the other named executive officers to TSPB because of the overall, company-wide focus on reducing costs and economically improving production in a period of weak commodity prices.

Individual Performance. The individual performance portion of the Annual Cash Incentive award for the named executive officers is designed to link incentive compensation directly to the performance of the particular executive. Payout is determined by the Compensation Committee’s assessment of an executive’s handling of certain key performance areas within that executive’s area of responsibility, as well as the executive’s response to unanticipated challenges. For 2016, the potential payout of the individual performance portion of the Annual Cash Incentive ranged from 0% - 80% of the target Annual Cash Incentive award for named executive officers other than Ms. Hollub, whose potential payout of the individual performance portion of her Annual Cash Incentive award ranged from 0% - 40% of her target Annual Cash Incentive award. In evaluating an executive officer’s performance, the Compensation Committee considered the following performance areas:

For a detailed discussion of the Compensation Committee’s considerations with respect to each named executive officer’s individual performance and resulting payouts, please see “Individual Compensation Considerations – Performance Assessment” beginning on page 30.

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Chief Executive Officer. In 2016, Ms. Hollub’s Annual Cash Incentive award was determined by the company and individual performance measures discussed below. For more details on the indicators and performance, see “Individual Compensation Considerations” beginning on page 30.

		Weight	Possible
		(% of	Payout			Indicated
	Objectives	Target)	Range	Metrics	Indicators	Payout
	Safety	12.5%	0-25%	■  Combined Employee / Contractor Injury & Illness Incidence Rate (IIR)   ■  Combined Employee / Contractor Days Away, Restricted or Transferred Rate (DART)	■  Beat target IIR with an IIR of 0.28   ■  Beat target DART with a DART of 0.16	25%
	Operational	27%	0-54%	■  Total Spend per Barrel   ■  Production Growth	■  Beat target TSPB of $28.50 with a TSPB of $28.37   ■  Exceeded target production growth from ongoing operations (grew volumes by 7% year-over-year)	40.5%
	Strategic	35%	0-70%	■  Development and Execution of Market-Driven Strategy   ■  Maintenance of Financial Discipline and Strong Balance Sheet	■  Achieved Colombia growth milestones   ■  Portfolio optimization on track   ■  Construction projects on-budget and on-schedule   ■  Achieved mixed financial target results	35%
	Organizational	5.5%	0-11%	■  Improvement of Organizational Effectiveness	■  Significant progress in growing Occidental’s unconventional expertise   ■  Increased talent in the geoscience and petrophysics areas   ■  Reorganized business units as a result of portfolio optimization	5.5%
	Individual	20%	0-40%	■  Oversight of succession planning process   ■  Effective leadership and communication   ■  Oversight of health, environment and safety responsibilities   ■  Overall contribution to company achievements	■  For details, see the discussion of Ms. Hollub’s performance assessment beginning on page 30	20%
TOTAL		100%	0-200%			126%
NEGATIVE ADJUSTMENT						-26%
ACTUAL PAYOUT						100%

Compensation Committee’s Exercise of Negative Discretion. Ms. Hollub’s performance indicated an Annual Cash Incentive award payout of 126% of target. While Ms. Hollub’s performance was strong in many key areas, the Compensation Committee determined to exercise negative discretion to reduce the payout of Annual Cash Incentive award by 26% to 100% of target in light of the continued effect of low commodity prices on Occidental’s results of operations and Occidental’s stock price performance.

Other Named Executive Officers. For 2016, payout of the company performance portion of the Annual Cash Incentive award for the other named executive officers was based solely on TSPB, an internal performance metric. The Compensation Committee determined that TSPB was appropriate to underlie the entirety of the company performance portion of the Annual Cash Incentive award because of Occidental’s increased focus on maximizing operating efficiencies and reducing costs, particularly in response to the continued weak commodity price environment. TSPB is a measure of the total spend per barrel of oil equivalent produced, and is defined by the formula below:

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In February 2016, the Compensation Committee set the target TSPB at $28.50 and retained discretion for awarding payouts for achievement above or below the target TSPB from 0% to 200% of target. The Compensation Committee believed this to be a challenging target that would reflect a significant reduction in costs, as TSPB for 2015 was $40.24.

Occidental’s TSPB at year-end 2016 was $28.37, achieving the target TSPB set for 2016 of $28.50 or below and representing a reduction in TSPB of over 54% from 2014. As a result, the Compensation Committee determined that the company performance portion of the Annual Cash Incentive awards for Ms. Backus and Messrs. Lowe, Stavros and Vangolen were earned at target. For a detailed discussion of the Compensation Committee’s considerations with respect to each named executive officer’s individual performance and resulting payout of the individual performance portion of the Annual Cash Incentive award, please see “Individual Compensation Considerations – Performance Assessment” beginning on page 30.

Long-Term Incentive Compensation. In 2016, this portion of the executive compensation program consisted of a performance-based TSR award and a time-based RSU award, which are each payable solely in shares of common stock. The long-term incentive awards are intended to provide incentives for achieving results consistent with the goal of maximizing stockholder value and to retain and motivate Occidental’s executives. The Compensation Committee believes that long-term compensation should represent the largest portion of each executive’s total compensation package and that the levels of payout should reflect Occidental’s performance, on a relative and absolute basis. During the process of determining the value of the long-term incentive component of each named executive officer’s compensation package for 2016, the Compensation Committee evaluated many factors, including:

Summary of 2016 Long-Term Incentive Program

2016 Long-Term Incentive Program. The 2016 long-term incentive program consisted of a performance-based relative TSR award and time-based RSU award, with the majority of the target long-term incentive award opportunity weighted toward performance, as indicated below:

Total Shareholder Return (TSR) Award. The Compensation Committee believes that the comparison of Occidental’s TSR over a specified period of time to peer companies’ returns over that same period is an objective external measure of Occidental’s effectiveness in translating its results into stockholder returns. TSR is the change in price of a share of common stock plus reinvested dividends, over a specified period of time, and is an indicator of management’s achievement of long-term growth in stockholder value. Payout of the TSR award is based on Occidental’s TSR against the companies within the peer group. The TSR award is denominated in performance stock units (PSUs), each of which is equivalent to one share of common stock. The percentage of such number of PSUs that will be payable at the end of the three-year performance period, which began July 1, 2016 and ends June 30, 2019, will depend on Occidental’s relative TSR performance. However, if Occidental’s absolute TSR is negative over the performance period, then, irrespective of Occidental’s ranking within the peer group, the payout of the TSR award is capped at no more than target. A table illustrating the potential payouts based on relative and absolute TSR performance is set forth below:

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The cap on payout of the TSR award in instances of negative TSR performance over the performance period is intended to reinforce the pay for performance nature of the program. The TSR award comprised 70% and 55% of Ms. Hollub’s and the other named executive officers’ target long-term incentive award opportunity for 2016, respectively. Mr. Chazen did not participate in the 2016 long-term incentive program. Cumulative dividend equivalents will be paid in cash at the end of the three-year performance period and will be paid only on the number of PSUs earned. The TSR award is intended to satisfy the tax deductibility requirements of Section 162(m). Forfeiture and change in control provisions applicable to the TSR award are discussed in more detail in the “Potential Payments” tables and the footnotes thereto, beginning on page 44.

Restricted Stock Unit (RSU) Award. The Compensation Committee determined that a time-based restricted stock unit (RSU) award was appropriate to comprise the remainder of the named executive officers’ 2016 long-term incentive award in light of the considerations discussed on page 23. The RSU award vests ratably over three years with one-third vesting on each of July 12, 2017, 2018 and 2019, subject to continued employment. The RSU award is denominated in restricted stock units, each of which is equivalent to one share of common stock. Payment for a vested RSU award will be made solely in shares of common stock. The shares of stock ultimately received by the named executive officer pursuant to the RSU award is subject to a two-year holding period and, after the expiration of the holding period, the named executive officer must continue to retain ownership of the shares until he or she satisfies the applicable stock ownership guidelines, as described on page 35. The RSU award comprised 30% and 45% of Ms. Hollub’s and the other named executive officers’ target long-term incentive award opportunity for 2016, respectively. Mr. Chazen did not participate in the 2016 long-term incentive program. Dividend equivalents are payable in cash at the time that dividends are paid on the company’s common stock. Forfeiture and change in control provisions applicable to the RSU award are discussed in more detail in the “Potential Payments” tables and the footnotes thereto, beginning on page 44.

Individual Compensation Considerations

In making executive compensation decisions for a given year, the Compensation Committee considers, among other factors, the performance of Occidental and the individual contributions of each named executive officer to Occidental’s overall performance and the performance of the executive’s business unit, as applicable.

  Vicki Hollub, President and Chief Executive Officer

Current Role. Ms. Hollub assumed the role of Chief Executive Officer at Occidental’s 2016 Annual Meeting on April 29, 2016 and has served as Occidental’s President and as a member of the Board of Directors since December 2015. As Chief Executive Officer, Ms. Hollub is responsible for all operations, the financial management of Occidental, implementing Occidental’s strategy, and assisting the Board with, among other matters, corporate strategy development, executive succession planning, executive compensation and talent development.

Tenure. Ms. Hollub has been an employee of Occidental for over 35 years, and has held increasingly significant leadership and technical positions.

Performance Assessment. In assessing Ms. Hollub’s accomplishments, the Compensation Committee considered the following accomplishments and actions:

Enhanced the value of Occidental’s portfolio of assets, with a focus on profitable growth opportunities for the oil and gas segment, both domestically and internationally. Throughout 2016, Occidental made a series of asset investment decisions, including those which will allow Occidental to focus its oil and gas development in areas where Occidental has depth and scale in order to fuel future growth. Results of those efforts included:

Completed Board-approved strategic review action items in a timely, beneficial, and efficient manner. As part of a multi-year process to streamline and focus operations to better execute Occidental’s long-term strategy and enhance value for stockholders, under the leadership of Ms. Hollub, Occidental:

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Focused on optimizing long-term return on invested capital by investing strategically, with an emphasis on lowering finding and development costs, operating costs and realizing capital efficiency. Led by Ms. Hollub and relying on a disciplined business approach and return-focused capital allocation decisions, Occidental:

Continued emphasis on identifying and developing Occidental’s future leadership. Ms. Hollub has worked with other members of senior management and the Board to ensure that the current and future leadership team is positioned to successfully meet the challenges of a dynamic industry. Specific accomplishments include:

Maintained focus on the Company’s commitment to safety, health, the environment, diversity, governance, social responsibility, and the highest standards of ethical conduct and to foster a collaborative culture. Under the leadership of Ms. Hollub, Occidental’s performance in these areas continued to receive high praise in 2016 as evidenced by:

Compensation Decisions. In recognition of the significant increase in Ms. Hollub’s responsibilities following her promotion to Chief Executive Officer, and in light of the accomplishments detailed above, the Compensation Committee set Ms. Hollub’s compensation package in 2016 as follows:

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  Edward A. Lowe, Executive Vice President and Group Chairman, Middle East

Current Role. Mr. Lowe has been Executive Vice President of Occidental since February 2015 and Group Chairman, Middle East since August 2016. Prior to that, Mr. Lowe served as President, Oxy Oil and Gas — International since 2009. Mr. Lowe is responsible for growing Occidental’s business in the Middle East, including strategy, business development, contract extensions and partner relationships.

Tenure. Mr. Lowe has been an employee of Occidental for over 33 years.

Performance Assessment. In assessing Mr. Lowe’s accomplishments, the Compensation Committee considered his contributions to the successful exit or sale of assets in Libya, Bahrain, Iraq and Yemen; Mr. Lowe’s involvement in the signing of an agreement with the Abu Dhabi National Oil Company (ADNOC) and OMV of Austria to explore and develop Abu Dhabi’s oil and gas fields in offshore northwest Abu Dhabi; and his oversight of the Al Hosn Gas plant, which received a “Project Execution of the Year” award from the “Oil and Gas Year Abu Dhabi 2016” for recognition of successful commissioning of the Shah Gas Development Project at year-end 2015.

Compensation Decisions. The Compensation Committee set Mr. Lowe’s compensation package in 2016 as follows:

  Marcia E. Backus, Senior Vice President, General Counsel and Chief Compliance Officer

Current Role. Ms. Backus has been General Counsel since October 2013 and Senior Vice President since May 2014. Ms. Backus is responsible for overseeing Occidental’s legal and compliance departments.

Tenure. Ms. Backus has been an employee of Occidental since October 2013. Previously, Ms. Backus was a partner at the law firm Vinson & Elkins L.L.P, heading the firm’s Energy Transactions/Projects Practice Group and serving in key leadership positions.

Performance Assessment. In assessing Ms. Backus’ accomplishments, the Compensation Committee considered her instrumental contributions to Occidental’s mergers and acquisitions activity, including the divestment of Occidental’s non-core domestic operations in the Piceance Basin and the divestment of non-core international operations in Libya, Bahrain, Iraq and Yemen. The Compensation Committee also considered her contributions to the successful acquisition of producing and non-producing leasehold acreage, CO₂ properties and related infrastructure in the Permian Basin; management of ongoing litigation matters; and overseeing the disposition of Occidental’s remaining shares of California Resources. In addition, Ms. Backus successfully secured payments of approximately $1 billion from Ecuador owed to Occidental pursuant to a November 2015 arbitration award.

Compensation Decisions. The Compensation Committee set Ms. Backus’ compensation package in 2016 as follows:

  Christopher G. Stavros, Senior Vice President and Chief Financial Officer

Current Role. Mr. Stavros has been Senior Vice President since February 2015 and Chief Financial Officer since July 2014. Mr. Stavros is responsible for Occidental’s tax, treasury and controller functions as well as investor relations, communications, public affairs and government relations.

Tenure. Mr. Stavros has been an employee of Occidental for over 12 years.

Performance Assessment. In assessing Mr. Stavros’ accomplishments, the Compensation Committee considered his leadership and management of Occidental’s accounting, treasury, investor relations and finance functions, including his involvement in the issuance of senior unsecured notes in 2016; the disposition of Occidental’s remaining shares of California Resources; leadership in cost reduction efforts and his

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maintenance of a conservative balance sheet despite depressed commodity prices, which were critical to Occidental’s maintenance of an “A” credit rating with the major ratings agencies, and resulted in a relative credit spread highly competitive with that of our peers. In addition, Mr. Stavros successfully maintains ongoing relationships with institutional investors and oversees corporate communications and government relations activities.

Compensation Decisions. The Compensation Committee set Mr. Stavros’ compensation package in 2016 as follows:

  Glenn M. Vangolen, Senior Vice President, Business Support

Current Role. Mr. Vangolen has been Senior Vice President, Business Support since February 2015, and, prior to that role, held positions of increasing responsibility in the oil and gas and corporate segments. In his current role, Mr. Vangolen is responsible for human resources; health, environment and safety; and information technology functions.

Tenure. Mr. Vangolen has been an employee of Occidental for over 36 years.

Performance Assessment. In assessing Mr. Vangolen’s accomplishments, the Compensation Committee considered Mr. Vangolen’s role in the launch of Occidental’s Re-Imagined Oilfield (RIO) project, an initiative aimed at driving innovation by valuing novel ideas and creating a platform for ideation with the goal of empowering employees to participate in shaping the future of Occidental; various honors and achievements bestowed on Occidental in 2016 under Mr. Vangolen’s leadership for safety, including seven OxyChem and OxyVinyls plants recognized by the Vinyl Institute for excellence in worker safety and environmental protection, based on performance against guidelines and standards established by federal agencies; and the achievement of unprecedentedly low injury rates at Colombia’s Cano Limon and Caricare fields, which achieved 365 days without a recordable injury.

Compensation Decisions. The Compensation Committee set Mr. Vangolen’s compensation package in 2016 as follows:

  Stephen I. Chazen, Former Chief Executive Officer

Current Role. Mr. Chazen is currently serving as strategic advisor and served as Chief Executive Officer from May 2011 to April 2016 and served as Occidental’s President from 2007 to December 2015. Mr. Chazen has served on Occidental’s Board of Directors since 2010.

Tenure. Mr. Chazen has been an employee of Occidental for over 23 years.

Compensation Decisions. The Compensation Committee made the following compensation decisions with respect to Mr. Chazen’s compensation package in 2016:

Status of Previously-Granted Performance Stock Awards

  2013 Long-Term Incentive Awards

In July 2013, the Compensation Committee granted long-term incentive awards to the then-named executive officers, which were allocated approximately 40% to a Return on Capital Employed Incentive Award (ROCE award) or a pair of Return on Asset Incentive Awards (ROA awards), 30% to a TSR award, and 30% to a performance-based Restricted Stock Incentive award (PRSI award), based on target performance and grant date stock price, except for Mr. Chazen, who received only an RSI award. Occidental’s returns and earnings metrics were greatly influenced by the decline in commodity prices that began in late 2014 and continued through 2016, which affected the payout of the 2013 long-term incentive awards. A table illustrating the payouts of the 2013 long-term incentive awards is shown below:

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Total Shareholder Return Award. In July 2013, the Compensation Committee granted TSR awards denominated in PSUs, each of which was equivalent to one share of common stock, to the then-named executive officers. The TSR awards granted in 2013 were payable in shares of common stock from zero to 150% of the target number of PSUs granted based on Occidental’s relative TSR performance compared to the TSR performance of its peer group. Additionally, if Occidental’s absolute TSR performance was negative over the performance period, payout of the award was capped at no more than the target number of PSUs granted. The performance period began July 1, 2013, and ended June 30, 2016.

In July 2016, the Compensation Committee certified Occidental’s TSR over the performance period, with Occidental ranking fifth out of the twelve companies in the peer group. While the interpolation formula as per the terms of the TSR award indicated a payout of 116.7% of the target number of PSUs granted in shares of common stock, payout of the TSR award was capped at the target number of PSUs granted because Occidental’s TSR performance over the performance period was negative. The number of shares earned, and the corresponding value realized by the named executive officers, are included in the “Options Exercised and Stock Vested” table on page 43. Not less than 50% of the net after-tax shares received pursuant to the TSR award are subject to a three-year holding period. The capping of the payout of the TSR awards at target, resulting from negative TSR performance over the performance period despite above-average relative performance, illustrates the pay-for-performance nature of Occidental’s executive compensation program and the alignment of the program with the interests of Occidental’s stockholders.

Other Compensation and Benefits

  Employment Arrangements

Employment agreements, offer letters or retention and severance arrangements may be offered to key executives for recruitment and retention purposes and to ensure the continuity and stability of management. Currently, none of the named executive officers have an employment agreement with Occidental.

Retention Benefits. In February 2013, as part of the succession planning process for the Chief Executive Officer, Occidental provided written arrangements regarding retention payments (Retention Benefits) in certain circumstances for Messrs. Lowe and Stavros, who do not have employment agreements with Occidental. Pursuant to the Retention Benefits, Mr. Lowe will receive a retention payment of two times, and Mr. Stavros three times, the executive’s then-current annual base salary in one lump sum payment on the one-year anniversary of the appointment of the new Chief Executive Officer, provided the covered executive remains employed by Occidental on that date. It is expected that Messrs. Lowe and Stavros will earn the Retention Benefits on April 29, 2017, the one-year anniversary of Ms. Hollub’s appointment as Chief Executive Officer.

  Qualified Defined Contribution Plans

Occidental does not have a defined benefit pension plan that provides named executive officers a fixed monthly retirement payment. Instead, all salaried employees on the U.S. dollar payroll, including the named executive officers, are eligible to participate in one or more tax-qualified, defined contribution plans.

Savings Plan. For 2016, the defined contribution 401(k) savings plan (Savings Plan) permitted employees to save a percentage of their annual salary up to the $265,000 limit set by IRS regulations, and employee pre-tax contributions were limited to $18,000. Employees may direct their contributions to a variety of investments. Occidental matches two dollars for every one dollar the employee contributes up to 2% of eligible pay, plus an additional dollar-for-dollar match on the next 3% of eligible pay. The named executive officers are fully vested in their account balances under the Savings Plan. The amounts contributed by Occidental to the Savings Plan are included in the “All Other Compensation” column of the Summary Compensation Table on page 37.

Retirement Plan. The defined contribution retirement plan (Retirement Plan) is funded annually through a reallocation process from the employee’s Supplemental Retirement Plan II (SRP II) account balance (described below). Because it is not possible to determine the exact amount that could be contributed to the Retirement Plan without exceeding governmental limits until the end of the year, the reallocation process has been developed to maximize the amount contributed each year to a tax-qualified defined contribution plan. The Retirement Plan is company-funded, and employees may not contribute to the Retirement Plan. The named executive officers are fully vested in their account balances under the Retirement Plan. The amounts allocated to the Retirement Plan are included in the SRP II contributions by Occidental in the “All Other Compensation” column of the Summary Compensation Table on page 37.

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  Nonqualified Deferred Compensation Plans

Occidental maintains two nonqualified deferred compensation plans: (i) the SRP II, and (ii) the Modified Deferred Compensation Plan (MDCP). The purpose of the SRP II is to provide eligible employees, including the named executive officers, with benefits to compensate them for maximum limits imposed by law on the amount of contributions that may be made to Occidental’s tax-qualified defined contribution plans. The purpose of the MDCP is to provide key management and highly compensated employees the ability to accumulate additional retirement income through deferrals of compensation.

Additional information regarding the terms and conditions of the SRP II and the MDCP is described on page 43. Amounts contributed to the SRP II on behalf of the named executive officers are included in the “All Other Compensation” column of the Summary Compensation Table on page 37. Amounts of salary and bonus deferred by named executive officers who participate in the MDCP are included as compensation in the “Salary,” and “Non-Equity Incentive Compensation” columns of the Summary Compensation Table on page 37, as applicable. In addition, the contributions, aggregate earnings, withdrawals and aggregate balances for the named executive officers in the SRP II and MDCP with respect to the 2016 fiscal year are shown in the “Nonqualified Deferred Compensation” table on page 44. No above market earnings were paid in 2016 under either the SRP II or the MDCP.

  Perquisites

Occidental provides a limited number of perquisites for its named executive officers, which consist principally of tax preparation fees, corporate aircraft use, excess liability insurance, annual physical examinations, relocation benefits in excess of Occidental’s company-wide policy and certain tax gross-ups.

Tax Preparation. Certain executives, including each of the named executive officers, are eligible to receive reimbursement for tax preparation. Eligible executives are required to have their personal tax returns prepared by a tax professional qualified to practice before the IRS in order to ensure compliance with applicable tax laws.

Corporate Aircraft Use. Directors and executive officers may use corporate aircraft for personal travel, if space is available. The director or executive reimburses Occidental for personal use of company aircraft, including any guests accompanying them, at not less than the standard industry fare level rate (which is determined in accordance with IRS regulations).

Insurance. Occidental offers a variety of health coverage options to all employees. The named executive officers participate in these plans on the same terms as other employees. Occidental provides all salaried employees with life insurance equal to twice the employee’s base salary. In addition, for all employees above a certain grade level, Occidental will pay for an annual physical examination. Occidental also provides certain executives, including the named executive officers, with excess liability insurance coverage.

Stock Ownership Guidelines

Occidental’s stock ownership guidelines are intended to more closely align the interests of the named executive officers with those of the company’s stockholders. The ownership requirements range from six times to three times the officer’s annual base salary, based on position, as illustrated below:

Unvested performance-based stock awards and performance-based stock units do not count toward satisfaction of the stock ownership guidelines. Officers subject to the guidelines are expected to comply within five years from the later of the effective date of the guidelines or the date the individual is named to a participating position. As of February 28, 2017, each of the named executive officers was in compliance with the guidelines (see “Beneficial Ownership of Directors and Executive Officers” table on page 50).

Equity Grant Practices

In 2016, the Compensation Committee granted a special, off-cycle restricted stock unit award to the named executive officers at its regularly scheduled February meeting to recognize the accomplishments of the executives in 2015, which contributed to Occidental’s strong production growth, lowered cost structure, continued execution of the company’s strategic review, preservation of a strong balance sheet during a time of challenging market conditions, and to incentivize retention. The Compensation Committee made equity grants pursuant to the long-term incentive program at its regularly scheduled July meeting. The grant date fair value of the restricted stock unit awards is based on the closing price of Occidental’s common stock on the NYSE on the day the Compensation Committee grants the award. The grant date fair value of the TSR award incorporates the closing price of Occidental’s common stock on the NYSE on the day the Compensation Committee grants the award, as well as the estimated payout percentage as of the grant date. As specifically authorized by the terms of the 2015 Long-Term Incentive Plan (2015 LTIP), the Compensation Committee has delegated to Ms. Hollub the authority to grant awards in certain circumstances to new employees.

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Potential Recoupment of Compensation Due to Misconduct

Occidental may recoup certain compensation from the executive officers in the event of misconduct pursuant to the terms of Occidental’s Code of Business Conduct, the terms of the plan underlying the Annual Cash Incentive awards and the terms of the 2015 LTIP. Occidental’s Code of Business Conduct prohibits any officer, employee or director from violating or circumventing any law of the United States or a foreign country or engaging in unethical conduct during the course of his or her employment. The Audit Committee of the Board of Directors oversees compliance with the Code of Business Conduct and has put in place procedures, including a compliance hotline, to ensure that all violations or suspected violations of the Code of Business Conduct are reported promptly, without fear of retaliation. In general, misconduct may have several consequences, including the following:

In addition, the 2015 LTIP includes a provision that gives Occidental the contractual right to recoup awards (i) where a participant has breached Occidental’s Business Code of Conduct by violating applicable law or company policy or engaging in unethical conduct or (ii) pursuant to a policy to be adopted by Occidental to comply with Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which will generally require recoupment of incentive-based compensation if Occidental is required to prepare an accounting restatement due to material noncompliance with any financial reporting requirement.

Compensation Committee Report

The Compensation Committee of the Board of Directors has reviewed and discussed with management the preceding Compensation Discussion and Analysis section for the year ended December 31, 2016. Based on these reviews and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Proxy Statement for the 2017 Annual Meeting of Stockholders.

Respectfully submitted,

THE EXECUTIVE COMPENSATION COMMITTEE

Margaret M. Foran (Chair)

Spencer Abraham

John E. Feick

William R. Klesse

Jack B. Moore

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EXECUTIVE COMPENSATION TABLES

Summary Compensation

SUMMARY COMPENSATION TABLE

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Grants of Plan-Based Awards

The table below shows the plan-based awards granted by the Compensation Committee to the named executive officers in 2016. The awards are abbreviated in the table as follows: (i) the Annual Cash Incentive award (ACI); (ii) a special, off-cycle restricted stock unit award (SRSU); (iii) a Restricted Stock Unit award (RSU) pursuant to the 2016 long-term incentive program; and (iv) a performance-based Total Shareholder Return award (TSR) pursuant to the 2016 long-term incentive program. For a summary of the key terms of the awards granted pursuant to the 2016 long-term incentive program, please see “Summary of 2016 Long-Term Incentive Program” beginning on page 29. For the actual amounts earned under the Annual Cash Incentive award, see the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table on page 37.

GRANTS OF PLAN-BASED AWARDS

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Outstanding Equity Awards

The table below sets forth the outstanding equity awards held by the named executive officers as of December 31, 2016.

OUTSTANDING EQUITY AWARDS AT DECEMBER 31, 2016