DEFINITIVE PROXY STATEMENT

Preliminary Proxy Statement

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

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material Pursuant to §240.14a-12

DEF 14A 1 d201674ddef14a.htm DEFINITIVE PROXY STATEMENT DEFINITIVE PROXY STATEMENT

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

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Atmos Energy Corporation

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LOGO

December 17, 2021

DEAR SHAREHOLDER:

Safety is at the center of everything we do, and it is our enduring vision to be the safest provider of natural gas services. Our steadfast commitment to safety paired with the guiding principles of our culture, AtmoSpirit, enabled us to emerge from Fiscal 2021 stronger and further demonstrate the resiliency and reliability of natural gas.

The safety of our employees, customers, communities and shareholders is our first priority. As part of our continued precautions regarding COVID-19, the annual meeting of shareholders on Wednesday, February 9, 2022, at 9:00 a.m. Central Standard Time, will be conducted virtually via webcast. You will be able to attend the meeting, vote your shares, and submit questions by logging on to www.virtualshareholdermeeting.com/ATO2022.

The annual meeting will include a report on our operations and consideration of the matters set forth in the accompanying Notice of Annual Meeting and Proxy Statement. All shareholders of record as of December 13, 2021, are entitled to vote.

Your vote is very important. Whether you plan to attend the virtual meeting or not, please cast your vote over the internet, by telephone or by mailing back a proxy card as soon as possible.

On behalf of your Board of Directors, thank you for your continued support and interest in Atmos Energy Corporation.


Sincerely,


Kim R. Cocklin				J. Kevin Akers
Chairman of the Board				President and Chief Executive Officer

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

2022 ANNUAL MEETING INFORMATION

LOGO

Meeting Date:

February 9, 2022

Virtual Meeting
Location:

Webcast at
www.virtualshareholder

meeting.com/

ATO2022

Meeting Time:

9:00 a.m. (Central)

Record Date:

December 13, 2021

ANNUAL MEETING BUSINESS

Atmos Energy Corporation’s annual meeting of shareholders will be held February 9, 2022 to:

1.	elect the 10 directors named in the proxy statement for one-year terms expiring in 2023;

2.	ratify the Audit Committee’s appointment of Ernst & Young LLP (“Ernst & Young” or “E&Y”) to serve as the Company’s independent registered public accounting firm for fiscal 2022;

3.	approve, on an advisory basis, the compensation of the named executive officers of the Company for fiscal 2021 (“Say-on-Pay”);

4.	approve, on an advisory basis, the frequency of Say-on-Pay in future years; and

5.	transact such other business as may properly come before the meeting or any adjournment thereof.

ATTENDING AND VOTING AT THE ANNUAL MEETING

There will be no physical location for the annual meeting. Shareholders may attend, vote, and ask questions at the meeting only by logging in at www.virtualshareholdermeeting.com/ATO2022. To participate, you will need your unique control number included on your proxy card or on the instructions that accompanied your proxy materials.

VOTING

YOUR VOTE IS VERY IMPORTANT TO US. Shareholders of record of our common stock at the close of business on December 13, 2021, will be entitled to notice of, and to vote at, our meeting. Whether or not you plan to attend the annual meeting, we urge you to vote as soon as possible by one of these methods.

LOGO

By Internet

www.proxyvote.com

By Telephone

1.800.690.6903

By Mail

Follow the instructions on your proxy card or voting instruction form

If you are a beneficial owner of shares held through a broker, bank or other holder of record, you must follow the voting instructions you receive from the holder of record to vote your shares. Shareholders may also vote during the virtual meeting using the unique control number assigned to him or her. For more information on how to vote your shares, please refer to “Information About the Meeting” beginning on page 61.

LOGO

Karen E. Hartsfield

Senior Vice President, General Counsel and Corporate Secretary

December 17, 2021

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING

OF SHAREHOLDERS TO BE HELD ON FEBRUARY 9, 2022:

This Proxy Statement, along with the Company’s Annual Report, which includes our Annual

Report on Form 10-K for the fiscal year ended September 30, 2021, are available at www.proxyvote.com.

Table of Contents


PROXY STATEMENT OVERVIEW			1

CORPORATE GOVERNANCE AND OTHER BOARD MATTERS			7

Independence of Directors			7

Board Leadership Structure			7

Risk Management and Oversight Framework			8

Cybersecurity Oversight			9

Corporate Governance Guidelines			9

Committees of the Board of Directors			10

Board and Committee Meetings in 2021			11

Succession Planning			11

Shareholder Engagement			12

Corporate Responsibility and Sustainability			12

Code of Conduct			12

Executive and Director Share Ownership Requirements			13

Clawback Policy			13

Anti-Hedging and Pledging Policy			13

Related Party Transactions Review and Approval Policy			13

Board Evaluation Process			15

Identifying and Evaluating Nominees for Directors			15

Shareholder Nominees			15

Communication with the Board			15

PROPOSAL ONE—ELECTION OF DIRECTORS			16

Qualifications for Directors			16

Director Nominees’ Skills and Experience			17

Nominees for Director			17

DIRECTOR COMPENSATION			23

Annual Compensation			23

Long-Term Compensation			23

Annual Review of Compensation			24

Summary of Cash and Other Compensation			25

Director Deferred Board Fees			26

PROPOSAL TWO—RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			27

Audit and Related Fees			27

Audit Committee Pre-Approval Policy			28

Audit Committee Report			28

PROPOSAL THREE—APPROVAL OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS			29
Background of the Proposal			29
Executive Compensation			29

COMPENSATION DISCUSSION AND ANALYSIS			30

Executive Summary			30


Fiscal 2021 Business and Performance Highlights			30

Compensation Highlights			31

2021 Actual Results			31

Executive Compensation Program Objectives and Strategy			32

Elements of Executive Compensation			34

Additional Information on Named Executive Officer Compensation			38

Competitive Executive Compensation Benchmarking			39

Independent Compensation Consultant			40

Management’s Role in Setting Named Executive Officer Compensation			40

Executive Transition			40

Director Retirements			41

NAMED EXECUTIVE OFFICER COMPENSATION			42

Summary of Cash and Other Compensation			42

Grants of Plan-Based Awards			44

Outstanding Equity Awards			45

Vested Common Stock			46

Retirement Plans			46

Retirement Plans Tables			47

Change in Control Severance Agreements			49

Potential Payments Upon Termination or Change in Control			50

PROPOSAL FOUR – APPROVAL OF THE FREQUENCY VOTE ON APPROVAL OF EXECUTIVE COMPENSATION			56

OTHER EXECUTIVE COMPENSATION MATTERS			57

Human Resources Committee Report			57

Compensation Risk Assessment			57

Chief Executive Officer Pay Ratio			57

BENEFICIAL OWNERSHIP OF COMMON STOCK			59

Security Ownership of Certain Beneficial Owners			59

Security Ownership of Directors, Nominees, & Executive Officers			60

INFORMATION ABOUT THE MEETING			61

Date, Time, and Location			61

Internet Availability of Proxy Materials			61

Access to the Webcast			61

Questions			61

Voting Matters			61

Proxy Solicitation			62

Shareholder Proposals			62

Annual Report			63

Other Business			63

APPENDIX A—RECONCILIATION OF NON-GAAP PERFORMANCE MEASURES TO GAAP			A-1


		2022 Proxy Statement

PROXY STATEMENT OVERVIEW

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information you should consider before casting your vote. Please read this entire proxy statement carefully before voting. This proxy statement is first being made available to our Shareholders on or about December 17, 2021.

2022 Annual Meeting Information

For additional information about our Annual Meeting, see “Information About the Meeting” on page 61.





Meeting Date: February 9, 2022	Virtual Meeting Location: Webcast at www.virtualshareholder meeting.com/ ATO2022	Meeting Time: 9:00 a.m. (Central)	Record Date: December 13, 2021

Meeting Agenda and Voting Recommendations

The Atmos Energy Corporation Board of Directors asks shareholders to vote on these matters:


Items of Business		Board Recommendation	Page Number
1.	Election of the 10 directors named as nominees in the proxy statement	FOR	16
2.	Ratification of selection of independent registered public accounting firm	FOR	27
3.	Approval, on an advisory basis, of the compensation of our named executive officers (“Say-on-Pay”)	FOR	29
4.	Approval, on an advisory basis, of the frequency of future advisory vote on Say-on-Pay	ONE YEAR	56

In addition to the above matters, we will transact any other business that is properly brought before the shareholders at the annual meeting.


Advance Voting Methods There will be no physical location for the annual meeting. Shareholders may attend, vote, and ask questions at the meeting only by logging in at www.virtualshareholdermeeting.com/ATO2022. To participate, you will need your unique control number included on your proxy card or on the instructions that accompanied your proxy materials. Even if you plan to attend the 2022 annual meeting of shareholders, we urge you to vote in advance of the meeting using one of these advance voting methods.



Via the Internet: www.proxyvote.com	Call Toll-Free: 1.800.690.6903	Mail Signed Proxy Card: Follow the instructions on your proxy card or voting instruction form

If you are a beneficial owner of shares held through a broker, bank or other holder of record, you must follow the voting instructions you receive from the holder of record to vote your shares.


				2022 Proxy Statement		1

About Atmos Energy

Atmos Energy Corporation, an S&P 500 company headquartered in Dallas, is the country’s largest natural gas-only distributor. We safely deliver reliable, affordable, efficient and abundant natural gas to more than 3 million distribution customers in over 1,400 communities across eight states located primarily in the South. As part of our vision to be the safest provider of natural gas services, we are modernizing our business and infrastructure while continuing to invest in safety, innovation, environmental sustainability and our communities. Atmos Energy manages proprietary pipeline and storage assets, including one of the largest intrastate natural gas pipeline systems in Texas.

Our Company

Our Vision

Our Strategy

We are the nation’s largest fully regulated, natural gas-only distributor of safe, clean, efficient and affordable energy.

Our vision is for Atmos Energy to be the safest provider of natural gas services. We will be recognized for exceptional customer service, for being a great employer, and for achieving superior financial results.

Atmos Energy’s strategy is to:

• operate our business exceptionally well

• invest in our people and our infrastructure

• enhance our culture

2021 Financial Results and Accomplishments

Fiscal 2021 continued to bring challenges, and Atmos Energy remained resilient as we work to achieve our vision of being the safest provider of natural gas services. Earnings and earnings per share increased for the 19^th consecutive year. In fiscal 2021, we generated net income of $665.6 million or $5.12 per diluted share. We recorded net income of $601.4 million, or $4.89 per diluted share for the year ended September 30, 2020. Adjusted net income for the year ended September 30, 2020, was $580.5 million, or $4.72 per diluted share.* Capital expenditures for fiscal 2021 totaled approximately $2.0 billion, with approximately 88% of this amount invested to improve the safety and reliability of our distribution and transmission systems.


		DILUTED EARNINGS PER SHARE				DECLARED DIVIDENDS PER SHARE
		$5.12				$2.50
		19^th Consecutive Year of EPS Growth				Up from $2.30 for FY2020

10^th Year of Organic Growth Strategy

Significant Regulatory Developments

✓ EPS of $5.12; 19th consecutive year of EPS growth

✓ FY 2021 Dividend of $2.50; 8.7% growth over FY 2020

✓ Capital spending of $2.0 billion

✓ Maintained strong balance sheet; equity capitalization of 61% as of September 30, 2021, excluding incremental Winter Storm Uri financing

✓ Implemented $185.7 million of annualized regulatory outcomes during fiscal 2021

✓ Kansas and Texas State Legislatures introduced securitization legislation to minimize the impact on the customer bill by extending the recovery periods for unprecedented purchased gas costs during Winter Storm Uri

Represents a measure of performance that is calculated and presented other than in accordance with generally accepted accounting principles (“GAAP”). See Appendix A for an explanation of these non-GAAP measures, a full reconciliation of these non-GAAP results to our GAAP net income and diluted net income per share results, and a brief discussion of why we use these non-GAAP performance measures.


2		ATMOS ENERGY

Corporate Governance Highlights

Our corporate governance policies and practices promote the long-term interests of our shareholders, strengthen the accountability of our Board and management, and help build public trust in the Company. Below is a summary of some of the highlights of our corporate governance framework.

BOARD PRACTICES

✓ independent lead director

✓ separation of board chair and CEO

✓ 8 of 10 director nominees are independent

✓ annual election of all directors

✓ regular executive sessions of independent directors

✓ comprehensive and strategic risk oversight

✓ mandatory retirement age for directors

✓ annual board and committee evaluations

✓ all committees chaired by independent directors

SHAREHOLDER MATTERS

✓ robust shareholder engagement

✓ annual Say-on-Pay voting

✓ majority voting for director elections

✓ no poison pill in force

OTHER GOVERNANCE PRACTICES

✓ executive and director stock ownership guidelines

✓ clawback policy

✓ prohibition on hedging or pledging stock


				2022 Proxy Statement		3

Director Nominees

We have included summary information about each director nominee in the table below. Each director is elected annually by a majority of votes. See “Nominees for Director” beginning on page 17 for more information regarding our director nominees.

COMMITTEES

Name and Primary Occupation

Age

Director

Since

Independent

J. Kevin Akers^(a)

President and Chief Executive Officer, Atmos Energy

2019

Kim R. Cocklin^(a)

Chairman of the Board, Atmos Energy

2009

Kelly H. Compton

Executive Director, Hoglund Foundation

2016

●

Sean Donohue

Chief Executive Officer, DFW International Airport

2018

●

Rafael G. Garza

President and Founder, RGG Capital Partners, LLC

2016

●

Richard K. Gordon

General Partner, Juniper Capital LP and

Juniper Energy LP; Senior Advisor,

Juniper Capital II and

Juniper Capital III

2001

●

Lead

Director

Nancy K. Quinn

Independent Energy Consultant

2004

●

Richard A. Sampson

General Partner and Founder, RS Core Capital, LLC

2012

●

Diana J. Walters

Founder and Managing Member, Amichel, LLC

2018

●

Frank Yoho

Former Executive Vice President and President of Natural Gas, Duke Energy

2020

●

AC = Audit HR = Human Resources NC = Nominating and Corporate Governance CR = Corporate Responsibility, Sustainability, & Safety EC = Executive

M = Member C = Chair

(a)	The director is not independent and accordingly is not eligible to be a member of any of the committees except the Executive Committee and/or the Corporate Responsibility, Sustainability, & Safety Committee, pursuant to the rules of the New York Stock Exchange.


4		ATMOS ENERGY

Director Nominee Composition


Gender		Race/Ethnicity


Tenure		Independence

Compensation Highlights

Our compensation programs are designed to both attract and retain top-level executive talent and align the long- and short-term interests of our executives with those of our shareholders. We received more than 92% shareholder support for our “Say-on-Pay” vote in 2021, which our Human Resources Committee considers to be among the most important items of feedback about our compensation programs. We recognize and reward our executive officers through compensation arrangements that directly link their pay to the Company’s performance, and we ensure a strong alignment of interests with our shareholders by including a significant amount of equity in the overall mix of pay. Our pay mix includes base salary, an annual incentive cash bonus plan (“Incentive Plan”), and a long-term incentive plan (“LTIP”) under which we grant time-based and performance-based restricted stock units (“RSUs”).


				2022 Proxy Statement		5

Fiscal 2021 Target Compensation Mix

Key Features of Our Executive Compensation Program

Executive officer awards under the Incentive Plan are generally capped at 200% of target. These awards are capped at target if the Company’s total shareholder return (“TSR”) for the performance period is negative.

Fifty percent of long-term incentive compensation is performance-contingent.

Our clawback policy provides for the repayment or forfeiture of all incentive-based compensation in certain circumstances.

Executives and directors are subject to stock ownership guidelines and retention requirements.

Severance under our change in control severance arrangements does not exceed three times the sum of a named executive officer’s base salary and their most recent annual Incentive Plan payment.

Our change in control severance arrangements are triggered only by an involuntary job loss or substantial diminution of duties.

We have no employment agreements with our officers.

We prohibit hedging and pledging of our securities at any time by any employees or directors.

There is no single trigger vesting of outstanding awards under our LTIP upon a change in control.

Our change in control severance arrangements do not contain excise tax gross-up payments.

We have no excessive perquisites for executives.

We pay dividends on performance-contingent stock awards when vesting is complete and then only to the extent performance targets are met.


6		ATMOS ENERGY

CORPORATE GOVERNANCE AND OTHER BOARD MATTERS

Independence of Directors

Our Corporate Governance Guidelines and the listing requirements of the New York Stock Exchange (“NYSE”) each require that a majority of the Board be comprised of “independent” directors, as defined from time to time by law, NYSE standards, and any specific requirements established by the Board. A director may be determined to be independent only if the Board has determined that he or she has no material relationship with the Company, either directly or as a partner, shareholder, or officer of the Company. To assist it in making its determination of the independence of each of its non-employee members, the Board has adopted its Categorical Standards of Director Independence (“Standards”). The Standards specify the criteria by which the independence of our non-employee directors will be determined and the types of relationships the Board has determined to be categorically immaterial, including relationships of such directors and their immediate families with respect to past employment or affiliation with the Company, our management or our independent registered public accounting firm. The Standards and our Guidelines are posted on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.”

The Nominating Committee considers all relevant facts and circumstances in evaluating the independence of directors, including without limitation, written responses to submitted questionnaires completed annually by each of our directors. On the basis of this information, the Nominating Committee advised the full Board of its conclusions regarding director independence. After considering the committee’s recommendation, for fiscal 2021, the Board affirmatively determined that each of the Company’s directors other than Mr. Akers, Mr. Cocklin, and Mr. Springer is independent in accordance with applicable NYSE and Securities and Exchange Commission (“SEC”) independence rules and requirements and the standards described above. The Board determined that Mr. Akers is not independent because he is the President and Chief Executive Officer of the Company; that Mr. Cocklin is not independent because he was the Executive Chairman of the Company until December 10, 2020; and that Mr. Springer is not independent because his son-in-law is a partner with the firm of E&Y, our independent registered public accounting firm. Mr. Springer’s son-in-law is not involved in our audit and is not considered a “covered person” with respect to us, as defined under the SEC’s independence-related rules and regulations for auditors. Thus, this relationship has no effect on E&Y’s independence as our independent registered public accounting firm.

Board Leadership Structure

The Company’s Corporate Governance Guidelines provide that our Board has the right to exercise its discretion to either separate or combine the offices of the Chairman of the Board and the CEO. This decision is based upon the Board’s determination of what is in the best interests of the Company and its shareholders, in light of the circumstances and taking into consideration succession planning, skills and experience of the individuals filling those positions and other relevant factors. The current leadership structure is based on the experienced leadership provided by a Chairman of the Board (currently Mr. Cocklin) and a full-time President and CEO (currently Mr. Akers), with both positions being subject to oversight and review by the Company’s independent directors. The Board recognizes that if the circumstances change in the future, other leadership structures might also be appropriate and it has the discretion to revisit this determination of the Company’s leadership structure.

The Board’s leadership structure is designed so that independent directors exercise oversight of the Company’s management and key issues related to strategy and risk. Only independent directors serve on our Audit Committee, Human Resources Committee (“HR Committee”) and Nominating and Corporate Governance Committee (“Nominating Committee”), and all standing Board committees are chaired by independent directors. Additionally, independent directors regularly hold executive sessions of the Board led by the Lead Director (defined below) outside the presence of the Chairman, the President and CEO or any other Company employee, and they generally meet in a private session with the Chairman and the President and CEO at regularly scheduled Board meetings.


				2022 Proxy Statement		7

Each year, the independent directors of the Board select an independent director to serve as a lead director (the “Lead Director”). The Lead Director is expected to consult with the chairs of the appropriate Board committees and solicit their participation. The Lead Director also has the authority to call meetings of the independent directors as well as the non-management directors; and if requested by major shareholders, will ensure that he or she is available for consultation and direct communication. In 2021, the independent directors of the Board designated Mr. Richard K. Gordon as the Lead Director.

Risk Management and Oversight Framework

The Board is actively involved in the oversight of risks that could affect the Company. This oversight is conducted primarily through committees of the Board pursuant to the charters of each committee, as described in the summaries of each of the committees beginning on page 10. The full Board has retained responsibility for oversight of strategic risks. The Board satisfies this responsibility through reports by each committee chair regarding the committee’s consideration and actions, as well as through regular reports directly from officers responsible for management of particular risks within the Company.


8		ATMOS ENERGY

While the Board and its committees have responsibility for general risk oversight, Company management is charged with managing risk. Through the Company’s Risk Management and Compliance Committee, the Company has a robust strategic planning and enterprise risk management process that facilitates the identification and management of risks. Our enterprise risk management program is supported by regular internal audits and audits by our independent public accounting firm. KPMG LLP (“KPMG”), which serves as the Company’s internal auditor, presents to the Audit Committee at its regularly scheduled quarterly meetings on its internal audit activities, including the audit activities performed the previous quarter, which address the key business risks identified by the Audit Committee, including evaluations and assessments of internal controls and procedures.

LOGO

Cybersecurity Oversight

The Audit Committee oversees the Company’s cybersecurity risks. Our Chief Information Officer provides the Audit Committee periodic cybersecurity updates.

Corporate Governance Guidelines

In accordance with, and pursuant to, the corporate governance standards of the NYSE, the Board has adopted and periodically updates our Corporate Governance Guidelines, which govern the structure and proceedings of the Board and contain the Board’s position on many governance issues. The Corporate Governance Guidelines are available on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.”


				2022 Proxy Statement		9

Committees of the Board of Directors

Atmos Energy’s Board committee structure is organized around key strategic issues to facilitate oversight of management. Committee chairs regularly coordinate with one another to ensure appropriate information sharing. To further facilitate information sharing, all committees provide a summary of significant actions to the full Board. As required under our Corporate Governance Guidelines, each standing committee conducts an annual self-assessment and review of its charter.


		AUDIT COMMITTEE Richard A. Sampson (Chair) Kelly H. Compton Rafael G. Garza Robert C. Grable Nancy K. Quinn Richard Ware II* Frank Yoho Meetings Held in Fiscal 2021: 4		The Audit Committee oversees our accounting and financial reporting processes and procedures, reviews the scope and procedures of the internal audit function, appoints our independent registered public accounting firm and is responsible for the oversight of its work and the review of the results of its independent audits. The Audit Committee also oversees the Company’s cybersecurity risk. The Audit Committee charter is available on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.” The Board has determined that each member of the Audit Committee satisfies the independence requirements of the NYSE and SEC applicable to members of an audit committee. All members are financially literate within the meaning of stock exchange listing rules. The Board has determined that the following individuals are each an audit committee financial expert, as defined by the SEC: Mr. Garza, Ms. Quinn, Mr. Sampson, Mr. Ware, and Mr. Yoho.

		HUMAN RESOURCES COMMITTEE Nancy K. Quinn (Chair) Kelly H. Compton Richard K. Gordon Richard A. Sampson Diana J. Walters Meetings Held in Fiscal 2021: 5		The Human Resources Committee reviews and makes recommendations to the Board regarding executive compensation policy and strategy, and specific compensation recommendations for the President and CEO, as well as our other officers. In addition, the committee determines, develops and makes recommendations to the Board regarding severance agreements, succession planning and other related matters concerning our President and CEO, as well as other officers. This committee also administers our LTIP and our Incentive Plan. The Human Resources Committee charter is available on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.” The Board has determined that each member of the committee satisfies the independence requirements of the NYSE and SEC applicable to members of a compensation committee.

		NOMINATING AND CORPORATE GOVERNANCE COMMITTEE Robert C. Grable (Chair) Sean Donohue Rafael G. Garza Richard K. Gordon Richard Ware II* Meetings Held in Fiscal 2021: 2		The Nominating and Corporate Governance Committee makes recommendations to the Board regarding the nominees for director to be submitted to our shareholders for election at each annual meeting of shareholders, selects candidates for consideration by the full Board to fill any vacancies on the Board which may occur from time to time and oversees all of our corporate governance matters. The Nominating and Corporate Governance Committee charter is available on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.” The Board has determined that each member of the committee satisfies the independence requirements of the NYSE and SEC.


10		ATMOS ENERGY


		CORPORATE RESPONSIBILITY, SUSTAINABILITY, & SAFETY COMMITTEE Richard K. Gordon (Chair) Robert W. Best Sean Donohue Nancy K. Quinn Stephen R. Springer* Diana J. Walters Frank Yoho Meetings Held in Fiscal 2021: 3		The Corporate Responsibility, Sustainability, & Safety Committee oversees matters relating to responsibility, sustainability, safety, the Company’s vision, values, culture, and diversity, and climate change risk. The Committee also assists management in setting strategy, establishing goals and integrating responsibility and sustainability into strategic and tactical business activities across the Company to create long-term shareholder value. The Corporate Responsibility, Sustainability, & Safety Committee charter is available on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.”

		EXECUTIVE COMMITTEE Richard K. Gordon (Chair) Robert C. Grable Nancy K. Quinn Richard A. Sampson Meetings Held in Fiscal 2021: 0		The Executive Committee has, and may exercise, all of the powers of the Board of Directors during the intervals between the Board’s meetings, subject to certain limitations and restrictions as set forth in the bylaws or as may be established by resolution of the Board from time to time. The Executive Committee charter is available on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.”

*	Mr. Springer retired from the Board, effective December 1, 2021. Mr. Ware retired from the Board, effective November 30, 2021.

Board and Committee Meetings in 2021

In fiscal 2021, the Board held 15 meetings. Each of the directors attended at least 80% of the total meetings of the Board and the Committees on which he or she served. In addition, we strongly support and encourage each member of our Board to attend our annual meeting of shareholders. All members of the Board attended our annual meeting of shareholders on February 3, 2021.

Succession Planning

The Board is actively engaged and involved in succession planning, including detailed discussions of the Company’s leadership and succession plans for key positions at the senior officer level. As part of these activities, the Board engages in a robust CEO succession planning process, including reviewing development plans for potential CEO candidates and engaging with potential successors at board meetings and in less formal settings to allow directors to personally assess candidates.

Succession planning does not stop with senior officers. We perform succession planning annually throughout the organization to ensure that we are building a strong bench of talent capable of performing at the highest levels. Not only is talent identified, but potential paths of development are discussed to ensure that employees have an opportunity to build their skills and are well-prepared for future roles. The strength of our succession planning process is evident through our long history of promoting our senior leadership from within the organization.


				2022 Proxy Statement		11

Shareholder Engagement

We believe that maintaining an active dialogue with our shareholders is important to our commitment to deliver sustainable, long-term value to our shareholders. We engage with shareholders on a variety of topics throughout the year to ensure we are addressing questions and concerns, to seek input, and to provide perspective on our policies and practices. We also engage with proxy and other advisory firms that represent the interests of various shareholders. Shareholder feedback is regularly reviewed and considered by the Board and is reflected in adjustments or enhancements to our policies and practices. We remain committed to investing time with our shareholders to maintain transparency and to better understand their views on key issues.

LOGO

Corporate Responsibility and Sustainability

Operating our business safely, ethically, and transparently, and meeting our responsibilities to the environment, to our employees, and to the communities in which we operate and live, are among our highest priorities. To learn more about our corporate responsibility and sustainability efforts, see our 2021 Corporate Responsibility and Sustainability Report on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.”

Code of Conduct

The Board has also adopted and periodically updates the Code of Conduct for our directors and employees. The Code of Conduct provides guidance to the Board and management in areas of ethical business conduct and risk and provides guidance to employees and directors by helping them to recognize and deal with ethical issues including, but not limited to (i) conflicts of interest, (ii) gifts and entertainment, (iii) confidential information, (iv) fair dealing, (v) protection of corporate assets and (vi) compliance with rules and regulations. We have provided to our directors, employees, customers, and any other member of the public a toll-free compliance helpline and website by which they may report on an anonymous basis any suggestions, recommendations, questions, observations of unethical behavior, or any suspected violations of our Code of Conduct. A copy of the Code of Conduct may be found on our website www.atmosenergy.com on the “Reports” page under “Corporate Responsibility.”


12		ATMOS ENERGY

Executive and Director Share Ownership Requirements

We have share ownership guidelines for our named executive officers and directors that require each named executive officer and director to hold a multiple of his or her base salary (or annual retainer) in shares of Company stock. The HR Committee believes that executive share ownership promotes better alignment of the interests of our named executive officers with those of our shareholders, and it monitors compliance with the ownership guidelines each year. Minimum ownership levels are as follows:



Position		Holding Requirement

Chairman of the Board		5X base salary value

President and CEO		5X base salary value

Other Named Executive Officers		3X base salary value

Non-Employee Directors		5X annual retainer

Ownership Sources Included
● Direct or indirect ownership of Company stock ● Unvested time-lapse RSUs ● Share units held by non-employee directors under our Directors Plan (defined on page 23) and the LTIP

Clawback Policy

Our Board has adopted an incentive compensation clawback policy to help ensure that incentive compensation is paid based on accurate financial and operating data, and the correct calculation of performance against incentive targets. Our policy addresses recoupment of amounts from performance-based awards paid to employees under the Incentive Plan and LTIP to the extent that they would have been materially less due to inaccurate financial statements, fraud, or intentional, willful or gross misconduct.

Anti-Hedging and Pledging Policy

Our Insider Trading Policy prohibits our directors and employees (including officers) from engaging in transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of Company stock including engaging in short sales or trading in options, puts, calls, or other derivative instruments related to Company stock or debt. The policy also prohibits directors and executive officers from pledging Company stock, borrowing against an account in which Company stock is held, or trading Company stock on margin.

Related Party Transactions Review and Approval Policy

The Board recognizes that related party transactions can present a heightened risk of potential or actual conflicts of interest and may create the appearance that Company decisions are based on considerations other than the best interests of the Company and its shareholders. As a result, the Board prefers to avoid related party transactions, while also recognizing that there are situations where related party transactions may be in the best interests of or may not be inconsistent with the best interests of the Company and its shareholders. The Board has adopted and periodically reviews written guidelines with respect to related party transactions delegated to the Nominating Committee the responsibility to review and, if not adverse to the Company’s best interests, approve, related party transactions. Under the guidelines, a related party transaction is any transaction (or series of related transactions) involving the Company and in which the amount involved exceeds $100,000 and a related person has a direct or indirect material interest. A “related person” is:

•

A director or executive officer of the Company;

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A shareholder who beneficially owns more than 5% of the Company’s stock or any immediate family member of such shareholder;


				2022 Proxy Statement

SEC Form DEF 14A filed by Atmos Energy Corporation