Textron | 2018 Corporate Responsibility Report

Integrity is the cornerstone of the way we do business at Textron. Our adherence to a strict standard of ethical behavior is not only the right thing to do but has earned us the trust and respect of our customers, shareholders, employees and the communities where we live and work.

All Textron employees - regardless of position or title - are accountable for safeguarding and furthering the high ethical standards associated with our company in the global marketplace. Adherence to our policies and the laws and regulations of each country within which we conduct business is expected. Our values of integrity, respect, trust and the pursuit of excellence are the foundation of our culture of responsible and ethical behavior.

For more than 30 years, Textron’s Ethics and Compliance Program has provided a road map and resources for our employees and has continued to evolve with changes in our business and regulations. The Program requires each of our business units to assess ethics and compliance risks annually and, based upon changes in the business, the operating environment and other factors, prepare annual risk-based Ethics and Compliance Action Plans which include action steps for risk mitigation. A variety of rigorous processes, ongoing monitoring, audits to detect violations, self-assessments by each Textron business unit and other performance checks are in place to ensure we are on the right course. Where appropriate, we incorporate lessons learned from these performance checks into our Ethics and Compliance Actions Plans and use them to otherwise improve our Program.

Oversight of Textron’s Ethics and Compliance Program resides at the highest levels of the organization. The Textron Steering Committee on Corporate Ethics and Compliance Program is responsible for oversight and review of the Program as well as its implementation and effectiveness. The Committee meets quarterly, and its members include Textron’s Chairman and Chief Executive Officer, Executive Vice President and Chief Financial Officer, and Executive Vice President, Human Resources. The Committee is chaired by the Executive Vice President, General Counsel and Chief Compliance Officer of Textron Inc., who also reports to the Audit Committee of the Board of Directors on legal, ethics and compliance matters at each Audit Committee meeting.

Textron's Business Conduct Guidelines reflect our philosophy and best practices in providing ethics and compliance guidance. Our Business Conduct Guidelines apply to our Board of Directors and every Textron employee around the world. They define our values and our code of conduct and point the way for all of us.

TEXTRON’S 2018 ETHICS & COMPLIANCE SURVEY

In 2018, Textron conducted a confidential, enterprise-wide survey targeted primarily to our administrative, professional and management employees (which represent more than half of our workforce) to measure our efforts in creating and sustaining a culture of compliance.

When asked if the company expects them to conduct Textron business with high ethical standards and in compliance with all applicable laws and regulations, 99% of responding employees agreed.

REINFORCING ETHICAL AND COMPLIANT BEHAVIORS

Business Conduct Guidelines and Compliance Certifications

All new employees are asked to review and acknowledge receipt of Textron’s Business Conduct Guidelines, which constitute our Code of Conduct, and we administer annual employee compliance certifications for both our Business Conduct Guidelines and our Global Anti-Corruption Compliance Policy.

Global Anti-Corruption Compliance Policy

Textron’s Global Anti-Corruption Compliance Policy applies to our Board of Directors and every Textron employee. It provides detailed standards and processes related to interaction with government officials and onboarding and monitoring of third-party business partners. The Policy prohibits improper payments to government officials and commercial bribery, and it strictly restricts facilitating payments to extremely limited situations where they are necessary to ensure the safety, health or well-being of Textron employees or their family members. The Policy provides detailed approval processes that govern gifts, entertainment, hospitality, and travel expenses for government officials, as well as non-U.S. charitable donations and non-U.S. political contributions. It also requires periodic training, certification, and background checks for employees in high risk positions.

With respect to third parties, the Global Anti-Corruption Compliance Policy establishes risk-based due diligence, review and approval requirements for the appointment of certain third parties acting on behalf of Textron outside the U.S., such as sales agents, representatives, dealers, distributors, consultants, customs brokers, freight forwarders, lobbyists, joint venture partners, offset providers and teaming partners. Additionally, it establishes procedures for payments to, contractual compliance provisions for agreements with, and continuing oversight of, such parties.

Compliance Training Modules

Training and awareness are an integral part of the Ethics and Compliance Program. Live and/or online compliance training are required for employees, including management. More than 126,000 online training modules on various ethics and compliance topics were completed by our employees in 2018.

Recognizing Our Employees

Textron employees are recognized for their achievements in ethics and compliance in one of three categories – Culture of Compliance, Standards and Procedures, and Communication and Training - through Textron’s annual Ethics and Compliance Award for Excellence. Positive reinforcement of best practices encourages our employees to make ethics and compliance a priority.

Ethics HelpLine

Multiple avenues exist to raise issues, ask questions or report violations without fear of retaliation, including through our confidential Ethics and Compliance HelpLine.