2019 Proxy Statement

TEXTRON 2019 PROXY STATEMENT 33 RISKS RELATED TO COMPENSATION The Committee strives to set compensation policies for senior executives which do not encourage excessive risk taking that could endanger the Company. For 201 , the Committee completed a full review of managing risk within our executive compensation program. This review was informed by a risk analysis of our executive compensation program conducted by the Committee’s independent compensation consultant. This annual review helps the Committee to structure executive compensation programs that are designed to avoid exposing the Company to unwarranted risk. OTHER COMPENSATION PROGRAMS As mentioned above, Textron provides certain other compensation programs (such as retirement death bene¿ts) that are designed to provide to NEOs the same level of bene¿ts provided to non executive of¿cers and, in most cases, all salaried employees. Certain of these programs provide bene¿ts over any caps mandated by government regulations, including: ‡ Textron Spillover Pension Plan: Non quali¿ed bene¿t plan to make up for IRS limits to quali¿ed pension plans and, in the case of Mr. Donnelly, to provide a “wrap around” pension bene¿t which takes into account his ¿nal average compensation with Textron and his combined service with Textron and GE and reduces this bene¿t by the amount of any other pension bene¿ts which he is eligible to receive under Textron and GE pension plans. ‡ Textron Spillover Savings Plan: Non quali¿ed bene¿t plan to make up for IRS limits to quali¿ed savings plans. Textron provides a program to executives which bene¿ts them by allowing for tax planning and also bene¿ts the Company, in that cash payments by the Company are delayed: ‡ Deferred Income Plan for Textron Executives: Non quali¿ed plan that allows participants to defer compensation. ROLE OF INDEPENDENT COMPENSATION CONSULTANT Under its charter, the Committee has the authority to retain outside consultants or advisors as it deems necessary to provide desired expertise and counsel. In 201 , the Committee engaged the services of Pay Governance LLC as its compensation consultant. Pay Governance reports directly and exclusively to the Committee and provides advice regarding current and emerging best practices with regard to executive compensation. In addition, as described above, Pay Governance annually conducts a risk review of our executive compensation program. A representative from Pay Governance attended each of the Committee’s ¿ve meetings in 201 . Pay Governance does not provide any other services to the Committee or the Company. The Committee has determined that Pay Governance is independent and that the work of Pay Governance with the Committee for 201 has not raised any conÀict of interest. STOCK OWNERSHIP REQUIREMENTS One objective of our executive compensation program is to align the ¿nancial interests of our NEOs with the interests of our shareholders. As a result, we require that senior executives accumulate and maintain a minimum level of stock ownership in the Company which may be achieved through direct ownership of shares, Textron Savings Plan shares, unvested RSUs and vested unvested share equivalents in Textron compensation and bene¿t plans. Minimum ownership levels are expressed as a multiple of base salary as follows: ¿ve times for the CEO and three times for other NEOs. New executive of¿cers are given ¿ve years to reach their required ownership level. All NEOs currently meet their respective stock ownership requirements or are within their initial ¿ve year period.