The Board has six standing committees: Audit, Governance and Nominating, Management Development and Compensation,
Public Policy and Corporate Responsibility, Special Activities, and Executive. The charter of each committee (other than the
Executive Committee) is published on our website. See “Corporate Governance—Governance Documents” on page 27 for information on obtaining a copy.
During 2018, the Board met formally seven times, and engaged in other discussions and actions apart from these meetings.
The non-employee directors, all of whom are independent, meet in executive session chaired by the Lead Director at the
conclusion of each regularly-scheduled Board meeting. In addition, committee members generally meet in executive session,
without management present, at the conclusion of regularly-scheduled committee meetings.
AVERAGE BOARD AND
COMMITTEE ATTENDANCE
FOR INCUMBENT DIRECTORS 99.0%
All incumbent directors attended at least 75% of the total of all Board and applicable
committee meetings. All directors standing for election are expected to attend the 2019
Annual Meeting. In 2018, all of the directors who were nominated for election at that time
attended the Annual Meeting.
The Board’s six standing committees are described below. Each committee, other than
the Executive Committee, is composed entirely of independent directors. The Executive
Committee, which is not required to meet, is made up of the Chairman, the Lead Director, and the chair of each of the
standing committees.
AUDIT COMMITTEE
NUMBER OF 2018 MEETINGS: 9
COMMITTEE MEMBERS:
Tracy A. Atkinson, Chair | Robert E. Beauchamp | Letitia A. Long | Ellen M. Pawlikowski | Marta R. Stewart | James A. Winnefeld, Jr. | Robert O. Work
KEY RESPONSIBILITIES:
Appoint and evaluate the performance and
independence of Raytheon’s independent auditors;
Oversee the integrity of our financial statements;
Oversee our internal audit function;
Consider the adequacy of our internal controls and the
objectivity of our financial reporting;
Review the independent auditors’ audit of the
effectiveness of Raytheon’s internal controls;
Pre-approve all audit fees and terms for, as well as all
non-audit engagements with, the independent auditors;
Review annual and periodic reports and earnings press
releases and recommend to the Board whether the
annual audited financial statements should be included
in Raytheon’s Form 10-K;
Review and discuss with management Raytheon’s risk
assessment and risk management policies, including
enterprise risk management and major financial risk
exposures, and steps to monitor and control such
exposures;
Review the performance of Raytheon’s pension plans
and risks related to those plans;
Oversee Raytheon’s management of such risks as may
be assigned periodically by the Board as a result of our
enterprise risk management process or otherwise;
Establish and review procedures for employees and
others to report concerns or complaints confidentially
and anonymously regarding accounting, internal control
or auditing matters; and
Review compliance with our Code of Conduct with
respect to certain financial reporting, controls and
allegations of financial misconduct.
The Board has determined that each member is independent in accordance with NYSE and SEC rules applicable to audit
committee members. The Board also has determined that, at a minimum, each of Mses. Atkinson and Stewart is an “audit
committee financial expert,” as defined by SEC rules, and that all members are “financially literate” under the NYSE standards.
The Audit Committee Report is included on page 83.
GOVERNANCE AND NOMINATING COMMITTEE
NUMBER OF 2018 MEETINGS: 6
COMMITTEE MEMBERS:
Stephen J. Hadley, Chair | George R. Oliver | Dinesh C. Paliwal | William R. Spivey
KEY RESPONSIBILITIES:
Review and report to the Board with regard to matters of
corporate governance;
Make recommendations regarding Board size and
composition;
Establish procedures for nominating directors and
recommend candidates for election to the Board;
From time to time, engage a third party for a fee to help
the Committee identify potential director candidates;
Consider director nominees proposed by shareholders;
Review our Governance Principles and recommend
revisions to the Board;
Review and approve or ratify transactions and
relationships under our Related Party Transactions Policy;
Review shareholder proposals in connection with our
Annual Meetings and recommend actions to the Board
regarding such proposals;
Oversee the orientation program for new directors and
the continuing education program for existing directors;
Review and recommend to the Board the compensation
of non-employee directors; and
Oversee Raytheon’s management of such risks as may
be assigned periodically by the Board as a result of our
enterprise risk management process or otherwise.
The Board has determined that each member is independent in accordance with NYSE rules.
MANAGEMENT DEVELOPMENT AND
COMPENSATION COMMITTEE (MDCC)
NUMBER OF 2018 MEETINGS: 6
COMMITTEE MEMBERS:
William R. Spivey, Chair | Robert E. Beauchamp | Adriane M. Brown | Stephen J. Hadley | George R. Oliver | James A. Winnefeld, Jr.
KEY RESPONSIBILITIES:
Review and oversee compensation and benefits, as well as
personnel plans, policies and programs;
Review and recommend to the Board the compensation
of the CEO, the CFO and the other three most highly
compensated executive officers (NEOs);
Evaluate the CEO’s individual performance;
Review and approve the compensation of elected officers;
Periodically review succession plans for the CEO and other
executive officers and elected officers, as well as career
development plans for elected officers and other key
employees;
Administer and make awards, other than to non-employee
directors, under our equity compensation plans;
Review and discuss with management the
“Compensation Discussion and Analysis” section of
this proxy statement;
Review Raytheon’s incentive compensation arrangements
to ensure they are not reasonably likely to encourage
inappropriate risk-taking;
Appoint, compensate and oversee any outside
compensation consultant, outside legal counsel, or other
committee adviser;
Annually assess the independence of its outside
compensation consultants or advisers, and pre-approve
any services proposed to be provided by such consultants
or advisers to Raytheon;
Periodically review Raytheon’s employee diversity and
inclusion efforts; and
Oversee Raytheon’s management of such risks as may
be assigned periodically by the Board as a result of our
enterprise risk management process or otherwise.
The Board has determined that each member is independent in accordance with NYSE rules.
PUBLIC POLICY AND CORPORATE RESPONSIBILITY COMMITTEE
NUMBER OF 2018 MEETINGS: 6
COMMITTEE MEMBERS:
Letitia A. Long, Chair | Tracy A. Atkinson | Robert E. Beauchamp | Adriane M. Brown | Dinesh C. Paliwal | Marta R. Stewart | Robert O. Work
KEY RESPONSIBILITIES:
Review political, social and legal trends and issues that
may affect Raytheon’s business, operations, financial
performance or public image;
Review our policies and practices in the areas of legal,
regulatory and social responsibility, including those
involving:
environmental protection;
health and safety of employees;
ethics and our Code of Conduct;
export control;
regulatory compliance (except financial matters);
charitable contributions and community relations;
government relations and legislative policy;
political contributions and lobbying;
anticorruption and use of foreign and domestic
consultants and representatives; and
government contracting and defense procurement
policies;
Review and monitor corporate policies and practices that
relate to public policy; and
Oversee Raytheon’s management of such risks as may
be assigned periodically by the Board as a result of our
enterprise risk management process or otherwise.
The Board has determined that each member is independent in accordance with NYSE rules.
SPECIAL ACTIVITIES COMMITTEE
NUMBER OF 2018 MEETINGS: 11
COMMITTEE MEMBERS:
Vernon E. Clark, Chair | Stephen J. Hadley | Letitia A. Long | Ellen M. Pawlikowski | James A. Winnefeld, Jr. | Robert O. Work
KEY RESPONSIBILITIES:
Review Raytheon’s programs, activities, strategic pursuits
and potential acquisitions involving classified business
activities;
Review policies, processes, practices, procedures,
risk management and internal controls applicable to
Raytheon’s classified business;
Review Raytheon’s cybersecurity, including with respect to
our internal IT systems, products, programs and factories;
Review any critical technology gaps and how Raytheon is
addressing such gaps;
Support the MDCC, as required, in the review of talent
development/succession planning for key technology
positions; and
Oversee Raytheon’s management of such risks as may
be assigned periodically by the Board as a result of our
enterprise risk management process or otherwise.
The Board has determined that each member is independent in accordance with NYSE rules.
EXECUTIVE COMMITTEE
The Executive Committee is empowered to act for the full Board during intervals between Board meetings, with the exception
of certain matters that by law may not be delegated. The Executive Committee did not meet in 2018.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Directors who served as members of our MDCC during 2018 were Robert E. Beauchamp, Adriane M. Brown, Stephen J.
Hadley, George R. Oliver, William R. Spivey and James A. Winnefeld, Jr. None of these members is or has ever been an
officer or employee of Raytheon. To our knowledge, there were no relationships involving members of the MDCC or our
other directors that would constitute a compensation committee interlock.
