Governance

Corporate Governance

Texas Pacific Land Trust (the “Trust”) was organized under a Declaration of Trust, dated February 1, 1888, to receive and hold title to extensive tracts of land in the State of Texas, previously the property of the Texas and Pacific Railway Company. The Trust was managed by three trustees empowered under the Declaration of Trust to manage the lands with all the powers of an absolute owner. After 132 years of operating as a business trust, the Trustees of the Trust, with the recommendation of a Conversion Exploration Committee, determined that it was in the best interest of the sub-share certificate holders to reorganize the Trust into a corporation following the laws of the State of Delaware. Accordingly, on January 11, 2021, all of the assets, rights, powers, liabilities, and obligations of the Trust were conveyed to Texas Pacific Land Corporation and Trust sub-share certificates were exchanged for common stock in TPL.

When TPL converted to a corporation from a business trust in 2021, the new Board approved and adopted Corporate Governance Guidelines that provide the framework for the governance of the Company, including oversight and stewardship of our ESG strategies. The Corporate Governance Guidelines, along with the charters of our Audit, Compensation, Strategic Acquisitions, and Nominating and Corporate Governance Committees and our Code of Business Conduct and Ethics, are available on our website at www.TexasPacific.com on our Investor Relations page under the heading “Governance Documents.”

Board of Directors

Oversight and accountability for TPL reside with our ten-member Board. The Board ensures TPL’s business is conducted with the highest levels of integrity, ethics, and responsibility to build strong corporate governance and achieve long-term financial value. This governance body works to ensure our business operations are also conducted in accordance with our ESG program standards.

Our current Board of Directors is as follows:

Board Members	Independent	Audit Committee	Nominating and Governance Committee	Compensation Committee	Strategic Acquisitions Committee	Member Since
Rhys J. Best	Independent X					Member Since April 2022
General Donald G. Cook	Independent X		Nominating and Governance Committee Chair	Compensation Committee X		Member Since January 2021
Barbara J. Duganier	Independent X	Audit Committee X		Compensation Committee Chair	Strategic Acquisitions Committee X	Member Since January 2021
Donna E. Epps	Independent X	Audit Committee Chair	Nominating and Governance Committee X			Member Since January 2021
Eric L. Oliver	Independent X	Audit Committee X				Member Since January 2021
Murray Stahl	Independent X		Nominating and Governance Committee X		Strategic Acquisitions Committee X	Member Since January 2021
Tyler Glover	Independent					Member Since January 2021
Karl F. Kurz	Independent X			Compensation Committee X	Strategic Acquisitions Committee Chair	Member Since April 2022
Marguerite Woung-Chapman	Independent X	Audit Committee X	Nominating and Governance Committee X			Member Since November 2023
Robert Roosa	Independent X	Audit Committee X		Compensation Committee X	Strategic Acquisitions Committee X	Member Since November 2023

Each Board member brings distinguished skills and capabilities enabling oversight of the strategies driving our long-term growth, economic performance, and sustainability and ESG goals.

Examples include:

Leadership / public company governance
Real estate and energy development
Company knowledge and experience
Financial expertise
Risk management
Talent management / executive compensation
Regulatory and legal compliance

Board Committees

The Board has four standing committees that help oversee the Company’s business: the Audit Committee, the Compensation Committee, the Strategic Acquisitions Committee and the N&G Committee. All standing committees are comprised entirely of independent directors, and our independent directors meet regularly in executive session. The responsibilities of each committee are listed below, along with additional detail in our Board and committee charters and Proxy Statement.

Audit Committee

Ensures the Company has adequate internal controls, including frequent engagement with the Company’s auditors to review internal controls and other financial reporting matters;
Appointment, pre-approval of work, compensation, and oversight of the auditors; and
Oversight of enterprise risk management, including oversight of risks from cybersecurity threats.

Nominating and Governance Committee

Identifies, evaluates, and recommends individuals qualified to become members of the Board;
Oversight of corporate governance matters; and
Oversight of Company policies and programs concerning corporate social responsibility, including ESG matters.

Compensation Committee

Reviews, approves, and recommends corporate goals and objectives relevant to the compensation of TPL’s Named Executive Officers;
Reviews and approves TPL’s compensation plans; and
Reviews and makes recommendations regarding compensation for non-employee directors.

Strategic Acquisitions Committee

Assists the Board in fulfilling oversight responsibilities related to the evaluation of potential acquisitions and divestitures.

Stockholder Engagement

We acknowledge and value the importance of our stockholders, and the trust they place in us to act as stewards of the company. As part of TPL’s commitment to stockholders, we publish transparent disclosures on our operations and actively seek to incorporate stockholder feedback into our business practices, as feasible.

Our timely and accurate disclosures to the investment community include, but are not limited to:

Press releases, dividend announcements, earnings releases, and earnings conference calls;
Detailed disclosures regarding our portfolio, including SEC Filings and other annual reports; and
Sustainability reporting through our website.

We believe our disclosures to the investment community foster a better understanding of our strategy and performance. Additionally, our disclosures are meant to help stockholders and analysts better understand our business, allowing for insightful communication and engagement on relevant topics of interest.

For the past several years, we have increased the frequency and scope of our stockholder engagement activities to actively solicit stockholder feedback, incorporating feedback wherever possible. We utilize a variety of communication and disclosure practices to maintain consistent and transparent engagement, including one-on-one meetings with stockholders, TPL’s annual meeting, and open dialogue in response to inquiries received by our investor relations team.

We believe our ability to listen to and incorporate stockholder feedback into our business practices allows TPL to generate long-term value for our stockholders, creating a more sustainable business. Within pages 34 through 37 of our Proxy Statement, we provide a comprehensive list of ways in which TPL has responded to stockholder feedback, including additional details on common discussion topics with the investment community.

Business Ethics and Transparency

TPL sets high standards for ethical business conduct that apply to each of our employees and all third parties that do business with the Company. Our ethics and compliance expectations, including our commitment to adhere to all applicable laws and best practices within the United States, are outlined in our Code of Business Conduct and Ethics (“Code of Conduct”), as well as the Employee Handbook. Each of these policies are reviewed periodically by the Audit Committee to ensure our standards reflect up-to-date ethics and compliance expectations. Any changes to our Code of Conduct must be approved by the Board.

Our Code of Conduct covers a variety of topics including, but not limited to:

Insider trading;
Related person transactions;
Political and charitable contributions;
Confidential information;
Intellectual property;
Bribery and corruption;
Gifts and entertainment; and
Reporting concerns.

All employees receive these policies upon hire and can access them through the TPL intranet site. Additionally, on an annual basis, employees and third-party contractors must read and acknowledge TPL’s Code of Conduct, as all employees and affiliates of the Company are required to comply with this Code. Failure to follow it subjects them to disciplinary action, up to and including termination and possible legal prosecution.

Employee Training

TPL mandates a variety of employee training courses, which are designed to promote an ethical and inclusive company culture. The training courses outlined below are critical to communicate TPL’s expectations and ensure employees are equipped with the resources they need to maintain responsible business practices, including access to communication channels to report potential ethical concerns.

Code of Conduct acknowledgement
Anti-bribery and Anti-Trust in the Workplace
Inclusive Behaviors
Discrimination and Anti-Harassment
Supervisor Management Training

All employees are required to undertake training annually or whenever there are changes to key provisions or updates. These trainings ensure all employees are aligned on expectations for ethical behavior and understand TPL’s company culture.

Reporting Ethics Concerns

The Policy for Reporting Concerns within TPL’s Code of Conduct outlines how employees are enabled and empowered to anonymously report ethics and compliance concerns through our Whistleblower Program. As part of this commitment, TPL prohibits any retaliation against any employee who in good faith reports a violation of this Code or any of the Company’s policies.

TPL provides good-faith reporters with numerous confidential communication channels to report concerns, including our anonymous Ethics Hotline (844-639-9563) and reporting website (https://texaspacific.ethicspoint.com). Employees can also communicate concerns to their manager, Compliance, Human Resource, the General Counsel, or the Audit Committee.

Our Ethics and Compliance team is informed of any grievance reports and is responsible for reviewing such reports within a reasonable timeframe. Reports that are submitted to the Ethics Hotline or reporting website are investigated by an independent party as deemed appropriate by Legal Compliance and/or the Board. This investigator will prepare a plan of investigation, which includes expected timing, persons to be interviewed, documents to be reviewed, reports to be prepared, and roles to be assigned to Company personnel and outside advisors. The Ethics and Compliance team will meet with the investigator on a regular basis to provide oversight and receive updates on the progress of any such investigation.

At the conclusion of the investigation, the Ethics and Compliance team and/or the independent investigator may recommend corrective action. Corrective actions will be consistent with applicable laws, regulations, and guidelines for disciplinary action included in the Employee Handbook. Available types of disciplinary action may include, but are not limited to, reprimand (verbal or written), suspension, and termination.

The Ethics and Compliance team shall maintain a log of all concerns and the status of any investigations and corrective actions. This team is also responsible for providing the Audit Committee with an update on all matters within the log at least quarterly.

Policy on Human Rights

All TPL operations are located within the U.S., and therefore subject to U.S. human rights and labor laws. In addition to adhering to all applicable laws, TPL outlines its corporate responsibility to protect human rights within its Human Rights Policy, which is aligned with various internationally recognized human rights principles, such as those outlined within the United Nations Universal Declaration on Human Rights, United Nations Guiding Principles on Business and Human Rights, and the International Labor Organization’s Declaration of Fundamental Principles and Rights at Work, among others. TPL’s commitment to protecting human rights extends to our employees, suppliers, and to the communities in which we operate, as we believe all employees, community members, and third-party agents of TPL are entitled to work in an environment that is free of any violation of their human rights.

To ensure our Human Rights Policy remains relevant, the Company commits to providing regular, objective monitoring and reporting on our human rights progress, as well as monitoring the effectiveness and performance of the Human Rights Policy. TPL’s Human Resources department is accountable for ensuring our Human Rights Policy is effectively implemented and all members engaged in activities under the Company’s control are responsible for the application of the Human Rights Policy. Additionally, TPL involves all employees in the process through annual trainings that cover inappropriate conduct, workplace harassment, and workplace violence.

As part of our commitment to human rights, TPL’s Human Rights Policy clearly outlines expectations for equal treatment and ethical behavior, including protection of freedom of association and collective bargaining, non-discrimination, and prohibition of forced and child labor within the workplace. Related policies, such as those outlined in our Code of Conduct, supplement our Human Rights Policy and ensure coverage of topics such as anti-harassment, prohibition of violence in the workplace, and our commitment to providing employees fair living wages and appropriate working hours.

TPL identifies our potential human rights impacts through active risk management, prevention, and structured mitigation strategies. Through TPL’s human rights impact and risk assessment, we are able to identify, prevent, mitigate, and remedy potential impacts on human rights. While this process focuses on our own operations, we also have a process to examine potential impacts from material third-party business relationships. Additionally, TPL does not lease surface to oil and gas operators or operate our water business in areas of conflict. In this way, we are able to protect human rights throughout our value chain.

Employees can report instances of workplace violence or suspicious activity by contacting the Department of Public Safety (DPS) through the iWatchTexas Community Reporting System at www.iwatchtx.org, or by calling 844-643-2251. Employees have the right to make a report to DPS anonymously. Human rights violations are monitored 24/7 through our Ethics Hotline.

None of the Company’s operations have been subject to human rights impact assessments and there have been no human rights grievances. While TPL has had no actual human rights incidents that require remediation, the Company is prepared to act quickly should that scenario ever arise. Disciplinary measures are also stipulated in our Business Code of Conduct and Ethics, which is acknowledged by all TPL employees annually.

Enterprise Risk Management

Our Board of Directors is responsible for overseeing the Company’s operations, including its strategy, risk management, and performance of management, to ensure alignment with the interests of our stockholders. The Board reviews and assesses material risks, including strategic, operational, IT and cyber security, human capital, and compliance. The Board regularly reviews the Company’s performance with management at quarterly in-person meetings. Additionally, a full risk assessment, including identification of potentially material risk factors can be found within TPL’s Form 10-K.

Additional detail on TPL’s risk oversight and risk assessment processes can be found within TPL’s Form 10-K and Proxy Statement. For more information on our climate-specific risk management processes, refer to the TCFD Risk Management section of this report.

Data Protection & Information Security

TPL is committed to proactively managing our data protection and information security policies and practices. While cyber threats continue to evolve, the Company remains steadfast in our cyber and IT security policies and trainings, as well as oversight and management of these issues.

Governance of IT and cybersecurity is overseen by the Audit Committee of the Board of Directors and implemented by Executive Leadership. Throughout the year, the Audit Committee receives periodic IT and cyber security updates, unless there is a notable event that requires immediate communication. TPL’s Director of Information Technology, as well as the services of a third-party chief information security officer (“CISO”), both of which hold extensive experience in cybersecurity, IT management, and related infrastructure, also assist with the management and implementation of cybersecurity practices.

Through our annual cybersecurity risk assessment and related risk management activities, TPL stays ahead of the latest cybersecurity threats and continues to track and implement relevant technology, talent, and practices to enhance our data protection and information security program. For example, TPL employs third-party annual external penetration testing, identity management and access control safeguards, encryption of data in transit and at rest, and network security and monitoring.

Our cyber security and IT policies and procedures are outlined in our Information Technology and Cyber Security Policy. Our policies require each of our employees to complete an annual information security training, in addition to other training requirements. The result is an educated, informed, and prepared workforce, with an awareness of potential cybersecurity threats, how they may occur, and how to report and escalate such matters. These training efforts are supplemented with regular corporate-led communications and outreach initiatives to facilitate cybersecurity awareness and ensure employees remain vigilant and informed about cybersecurity threats and trends.

As a result of our efforts, TPL has experienced zero cybersecurity breaches over the last five years. For more extensive disclosures on TPL’s cybersecurity and related risk management practices, refer to the Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure within our Form 10-K.