Depends. If I’m peeing outdoors, I don’t bother to retract. If I’m indoors sitting, I don’t retract. If I’m at a urinal, sometimes do, sometimes don’t. But if I don’t, I always give a tug forward first to make sure nothing is sticking together that might cause a crazy stream. After tugging it’s a straight shot out. I prefer to hold my penis at a urinal by the covered glans rather than by the shaft, retracted. But either is fine. My choice doesn’t matter whether I’m being watched, which I don’t mind, either.
I have some friends with long foreskins who don’t retract to pee because they’ve learned, through trial and error, that their long prepuce serves as a reliable funnel that channels their stream. When they retract they often have a “split stream”. Other friends with long foreskins have the opposite experience and aim better when retracted slightly or fully. It really depends on learning what works best with your own anatomy, rather than following some vague “best practices” rules of behavior.
I think it’s a given that all intact boys start out peeing through our acroposthions and don’t give it any thought. The question then is when and why some guys change that pattern. The most common reasons for preferring to retract are aim and hygiene. Sometimes parents expect it and sometimes we just observe and follow peers. Ultimately it should come down to what feels best and works best for you.