Board of Directors Alignment with Government Standards

Our Alignment with Governance Standards

In 2018, Lockheed Martin became a signatory to the Commonsense Principles 2.0, a series of corporate governance principles for public companies, their boards and their institutional stockholders, which are intended to provide a basic framework for sound, longterm oriented governance. These Principles recognize that not every principle will be applied in the same fashion (or at all) by every company or board. In addition, our corporate governance practices comply with the Investor Stewardship Group (ISG) Corporate Governance Principles for U.S. Listed Companies that went into effect in 2018. Below we identify each of the ISG's corporate governance principles and how our specific practices are aligned. 

Boards are Accountable to Stockholders

  • Annual election of directors 
  • Majority voting standard for uncontested director elections 
  • Directors not receiving majority support tender resignation to Board for consideration 
  • Market-standard proxy access right for stockholders 
  • No poison pill 
  • Fully disclose corporate governance practices

Boards should Adopt Structures and Practices that Enhance their Effectiveness

  • 10 of 11 directors are independent 
  • 3 of our directors are women 
  • Significant Board refreshment 
  • Directors reflect a diverse mix of skills and experience 
  • All Board committees are fully independent 
  • Annual Board and committee selfassessments 
  • Board access to officers and employees 
  • 2020 Board attendance greater than 97% 
  • Overboarding policy ensures Board members can devote sufficient time to the Corporation

Boards should be Responsive to Stockholders and be Proactive in Order to Understand their Perspectives

  • Proactive, year-round engagement with stockholders, including participation of independent Lead Director 
  • Engagement topics included 2020 leadership changes, board and workforce diversity, human capital management, executive compensation, and environmental, social and governance (ESG) matters, including climate change

Boards should have Strong, Independent Leadership

  • Empowered independent Lead Director 
  • Annual review of Board leadership structure 
  • Independent chairs of all Board committees

Stockholders should be Entitled to Voting Rights in Proportion to their Economic Interest

  • One class of voting stock 
  • “One share, one vote” standard

Boards should Develop Management Incentive Structures that are Aligned with the Long-Term Strategy of the Company

  • Compensation programs actively reviewed by the Board and include short- and long-term goals tied to the long-range plan and that underpin our long-term strategy