Summary
Lockheed Martin Corporation (LMT) announced on September 22, 2011, a significant change in its executive compensation policy regarding tax assistance for elected officers. Effective January 1, 2012, the company will discontinue providing tax gross-ups for the personal use of corporate aircraft and taxable business association dues. This move signals a potential effort to streamline executive benefits and align with investor scrutiny on executive compensation practices. The company, however, will continue to offer tax assistance for specific expenses such as security, relocation, and family travel accompanying officers on business trips. Lockheed Martin's Board of Directors believes these continued provisions have a clear business purpose and benefit to the corporation, indicating a measured approach to adjusting executive perks while maintaining support for essential business-related functions.
Key Highlights
- 1Lockheed Martin is discontinuing tax assistance (gross-ups) for personal use of corporate aircraft for elected officers, effective January 1, 2012.
- 2Tax assistance for taxable business association dues for elected officers will also be discontinued from January 1, 2012.
- 3The company will continue to provide tax assistance for security, relocation, and family travel for accompanying officers on certain business trips.
- 4The Board of Directors believes the continued tax assistance for specific areas serves a business purpose and benefits the corporation.
- 5This policy change reflects a review and adjustment of executive compensation practices.
- 6The decision was made by the Board of Directors upon the recommendation of the Management Development and Compensation Committee.