Company Name: Raytheon Co.
Public Availability Date: February 15, 2008
Document Sections:
INQUIRY LETTER
APPENDIX 1
APPENDIX 2
INQUIRY LETTER
STAFF REPLY LETTER
[INQUIRY LETTER]
Via DHL Overnight Delivery
February 12, 2008
Office of the Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Re: Raytheon CompanyFile No. 1-13699 Statement of Reasons for Omission of
Sustainability Report Shareholder Proposal Pursuant to Rule 14a-8(i)(10)
Ladies and Gentlemen:
We are writing in reference to Raytheon's January 23, 2008 letter to you
requesting the Staff's concurrence that the shareholder proposal on issuance of
a Sustainability Report referenced therein be excluded from our 2008 Proxy
Statement.
Please be advised that, after discussions on the matter, we have been notified
by the proponent, the Office of the Comptroller of the City of New York (acting
on behalf of various New York retirement funds), that the Sustainability Report
proposal is withdrawn. Consequently, we hereby respectfully withdraw our January
23\rd/ request.
Very truly yours,
/s/
Mark D. Nielsen
cc: Patrick Doherty, New York City Office of the Comptroller
[APPENDIX 1]
October 29, 2007
Mr. Jay B. Stephens
Secretary
Raytheon Company
870 Winter Street
Waltham MA 02451
Dear Mr. Stephens:
The Office of the Comptroller of New York City is the custodian and trustee of
the New York City Employees' Retirement System, the New York City Teachers'
Retirement System, the New York City Police Pension Fund, and the New York City
Fire Department Pension Fund, and custodian of the New York City Board of
Education Retirement System (the "funds"). The funds' boards of trustees have
authorized the Comptroller to inform you of their intention to offer the
enclosed proposal for consideration of stockholders at the next annual meeting.
I submit the attached proposal to you in accordance with rule 14a-8 of the
Securities Exchange Act of 1934 and ask that it be included in your proxy
statement.
Letters from The Bank of New York certifying the funds' ownership, continually
for over a year, of shares of Raytheon Company common stock are enclosed. The
funds intend to continue to hold at least $2,000 worth of these securities
through the date of the annual meeting.
We would be happy to discuss this initiative with you. Should the board decide
to endorse its provisions as company policy, our funds will ask that the
proposal be withdrawn from consideration at the annual meeting. Please feel free
to contact me at (212) 669-2651 if you have any further questions on this
matter.
Very truly yours,
/s/
Patrick Doherty
pd:ma
Enclosures
[APPENDIX 2]
Sustainability Report 2008
WHEREAS:
Investors increasingly seek disclosure of companies' social and environmental
practices in the belief that they impact shareholder value. Many investors
believe companies that are good employers, environmental stewards, and corporate
citizens are more likely to be accepted in their communities and to prosper
long-term. According to Innovest, an environmental investment research
consultant, major investment firms including ABN-AMRO, Neuberger Herman,
Schroders, T. Rowe Price, and Zurich Scudder subscribe to information on
companies' social and environmental practices.
Sustainability refers to development that meets present needs without impairing
the ability of future generations to meet their own needs. The Dow Jones
Sustainability Group defines corporate sustainability as "a business approach
that creates long-term shareholder value by embracing opportunities and managing
risks deriving from economic, environmental and social developments."
Globally, approximately 1,900 companies produce reports on sustainability issues
(www.corporateregister.com), including more than half of the global Fortune 500
(KPMG International Survey of Corporate Responsibility Reporting 2005).
Companies increasingly recognize that transparency and dialogue about
sustainability are elements of business success. For example, Unilever's
Chairman stated in a 2003 speech, "So when we talk about corporate social
responsibility, we don't see it as something business "does" to society but as
something that is fundamental to everything we do. Not just philanthropy or
community investment, important though that is, but the impact of our operations
and products as well as the interaction we have with the societies we serve."
An October 6, 2004 statement published by social research analysts reported that
they value public reporting because "we find compelling the large and growing
body of evidence linking companies' strong performance addressing social and
environmental issues to strong performance in creating long-term shareholder
value... We believe that companies can more effectively communicate their
perspectives and report performance on complex social and environmental issues
through a comprehensive report than through press releases and other ad hoc
communications." (www.socialinvest.org)
RESOLVED: Shareholders request that the Board of Directors issue a report to
shareholders, by December 31, 2008, at reasonable cost and omitting proprietary
information, on the Company's sustainability policies and performance, including
multiple, objective statistical indicators.
Supporting Statement
The report should include the Company's definition of sustainability, as well as
a company-wide review of company policies, practices, and indicators related to
measuring long-term social and environmental sustainability.
We recommend that the Company use the Global Reporting Initiative's
Sustainability Reporting Guidelines ("The Guidelines") to prepare the report.
The Global Reporting Initiative (www.globalreporting.org) is an international
organization with representatives from the business, environmental, human
rights, and labor communities. The Guidelines provide guidance on report
content, including performance in six categories (direct economic impacts,
environmental, labor practices and decent work conditions, human rights,
society, and product responsibility). The Guidelines provide a flexible
reporting system that permits the omission of content that is not relevant to
company operations. Almost 900 companies use or consult the Guidelines for
sustainability reporting.
[INQUIRY LETTER]
Via DHL Overnight Delivery
January 23, 2008
Office of the Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Re: Raytheon CompanyFile No. 1-13699 Statement of Reasons for Omission of
Sustainability Report Shareholder Proposal Pursuant to Rule 14a-8(i)(10)
Ladies and Gentlemen:
Raytheon Company ("Raytheon" or the "Company") has received a shareholder
proposal (the "Proposal") which is attached to this letter as Exhibit A, from
the Office of the Comptroller of New York City, as custodian and trustee of the
New York City Employees' Retirement System, the New York City Teachers'
Retirement System, the New York City Police Pension Fund and the New York City
Fire Department Pension Fund, and as custodian of the New York City Board of
Education Retirement System (the "Proponent"), that the Proponent wishes to have
included in Raytheon's proxy materials for its 2008 annual meeting of
shareholders.
The Proposal states as follows:
"Whereas:
Investors increasingly seek disclosure of companies' social and environmental
practices in the belief that they impact shareholder value. Many investors
believe companies that are good employers, environmental stewards, and corporate
citizens are more likely to be accepted in their communities and to prosper
long-term. According to Innovest, an environmental investment research
consultant, major investment firms including ABN-AMRO, Neuberger Herman,
Schroders, T. Rowe-Price, and Zurich Scudder subscribe to information on
companies' social and environmental practices.
Sustainability refers to development that meets present needs without impairing
the ability of future generations to meet their own needs. The Dow Jones
Sustainability Group defines corporate sustainability as "a business approach
that creates long-term shareholder value by embracing opportunities and managing
risks deriving from economic, environmental and social developments."
Globally, approximately 1,900 companies produce reports on sustainability issues
(www.corporateregister.com), including more than half of the global Fortune 500
(KPMG International Survey of Corporate Responsibility Reporting 2005).
Companies increasingly recognize that transparency and dialogue about
sustainability are elements of business success. For example, Unilever's
Chairman stated in a 2003 speech, "So when we talk about corporate social
responsibility, we don't see it as something business "does" to society but as
something that is fundamental to everything we do. Not just philanthropy or
community investment, important though that is, but the impact of our operations
and products as well as the interaction we have with the societies we serve.
An October 6, 2004 statement published by social research analysts reported that
they value public reporting because "we find compelling the large and growing
body of evidence linking companies' strong performance addressing social and
environmental issues to strong performance in creating long-term shareholder
value. We believe that companies can more effectively communicate their
perspectives and report performance on complex social and environmental issues
through a comprehensive report than through press releases and other ad hoc
communications. (www.socialinvest.org)
Resolved: Shareholders request that the Board of Directors issue a report to
shareholders, by December 31, 2008, at reasonable cost and omitting proprietary
information, on the Company's sustainability policies and performance, including
multiple, objective statistical indicators.
SUPPORTING STATEMENT
The report should include the Company's definition of sustainability, as well as
a company-wide review of company policies, practices, and indicators related to
measuring long-term social and environmental sustainability.
We recommend that the Company use the Global Reporting Initiative's
Sustainability Reporting Guidelines ("The Guidelines") to prepare the report.
The Global Reporting Initiative (www.globalreporting.org) is an international
organization with representatives from the business, environmental, human rights
and labor communities. The Guidelines provide guidance on report content,
including performance in six categories (direct economic impacts, environmental,
labor practices and decent work conditions, human rights, society, and product
responsibility). The Guidelines provide a flexible reporting system that permits
the omission of content that is not relevant to company operations. Almost 900
companies use or consult the Guidelines for sustainability reporting.
Raytheon proposes to omit the Proposal and its supporting text because it is
excludable under Rule 14a-8(i)(10), since it has already been substantially
implemented by Raytheon.
Accordingly, we submit this statement of reasons for exclusion of the Proposal
from the 2008 proxy materials pursuant to Rule 14a-8(j) promulgated under the
Securities Exchange Act of 1934, as amended, and hereby request that the Staff
of the Division of Corporation Finance confirm that it will not recommend
enforcement action against Raytheon should it omit the Proposal from its 2008
proxy materials. Pursuant to Rule 14a-8(j)(2), filed herewith are six copies of
this letter as well as six copies of the Proposal. In addition, pursuant to Rule
14a-8(j)(1), Raytheon is notifying the Proponent of its intention to omit the
Proposal from the 2008 proxy and we have provided a copy of this submission to
the Proponent.
1. Raytheon Currently Publishes a Stewardship Report that Substantially
Implements the Written Objectives of the Proposal, and the Proposal Should
Therefore Be Excluded.
This Proposal requests that Raytheon issue a sustainability report to
shareholders, at reasonable cost, and omitting proprietary information, by
December 31, 2008. Since 1996, the Company has published a Stewardship Report,
or its precursor, for the benefit of stockholders and other stakeholders, and
intends to continue publishing such a Report periodically in the future. The
Company's current Stewardship Report issued in April 2007 covers the Company's
commitment and actions in an array of areas including: the environment, energy,
health, safety, diversity, community giving, corporate governance and ethics.
The Report features the Company's efforts and accomplishments in promoting
employee health and wellness along with a safe work environment, reducing
hazardous waste and solid waste, saving electricity, and reducing greenhouse gas
emissions. In many instances, these accomplishments are reported in terms of
specific statistical indicators. Thus, the Company believes that it has
substantially fulfilled the proponent's request for a sustainability report by
publishing the Stewardship Report.
Raytheon's Stewardship Report is publicly available at http://www.raytheon.com
by selecting "Investor Relations" and clicking on the link entitled "Stewardship
Report PDF Format." In June 2006, the Company began making available an
interactive online version of the Report. It is also noteworthy that, although
the Proponent cites the 1,900 companies globally that produce reports on
sustainability issues as appearing at www.CorporateRegister.com, it fails to
acknowledge that Raytheon's current Sustainability Report is among those
included in full on the Corporate Register site. Rule 14a-8(i)(10) allows for
the exclusion of proposals "if the company has already substantially implemented
the proposal."
The Staff has consistently taken the position that shareholder proposals are
moot under Rule 14a-8(i)(10) when the procedures or policies addressed in the
proposal have been substantially implemented by the company. See, for example,
Nordstrom Inc. (February 8, 1995)(proposal that requested company's board of
directors to commit to a code of conduct to ensure that its overseas suppliers
meet basic standards of conduct held moot because company had issued conduct
guidelines to all of its vendors).
In order to make the determination that a procedure or policy has been
substantially implemented, the Commission does not require that a company
implement every aspect of the proposal in question. See SEC Release No. 34-20091
(August 16, 1983). See also, AMR Corporation (April 17, 2000), Masco Corp.
(March 29, 1999), Erie Indemnity Company (March 15, 1999), AutoNation Inc.
(March 5, 2003; request for reconsideration denied on March 20, 2003) and
AutoNation Inc. (February 10, 2004; request for reconsideration denied on April
1, 2004), where in each instance the Division concurred that an issuer may omit
a shareholder proposal from its proxy materials under Rule 14a-8(i)(10) where
the proposal was not implemented exactly as proposed. Rather, a company need
only have appropriately addressed the concerns underlying such a proposal. See,
for example, Texaco, Inc. (March 11, 1991)(company's environmental policies and
practices rendered the proposal moot despite some differences between the
company's policies and practices and the specific request of the proposal).
In a 2006 no-action ruling, the staff permitted Raytheon to omit a proposal from
this same Proponent that was substantively identical to the Proposal. See,
Raytheon (January 25, 2006). Additionally, in more recent no-action rulings that
closely mirror Raytheon's request, the staff permitted ConAgra Foods, Inc.,
Honeywell International, Inc., and The Kroger Co. to omit proposals that are
substantively identical to the proposal submitted to Raytheon. The staff
permitted the exclusions, noting ConAgra's, Honeywell's and Kroger's
representations that they already prepare and publish equivalent reports. See,
ConAgra Foods, Inc. (July 3, 2006) Honeywell Int'l, Inc. (February 21, 2007) and
Kroger Co. (April 11, 2007).
Raytheon does recognize that in Terex Corporation (March 18, 2005), the Staff
did not permit exclusion (on substantial implementation grounds) of a proposal
that was also substantively identical to the Proposal. Unlike Raytheon, Terex
claimed that it substantially implemented the proposal by including on its
website its views regarding corporate citizenship and making reference to a
variety of other public disclosures including filings made with the Securities
and Exchange Commission. Raytheon's claim of substantial implementation may be
distinguished from Terex' because Raytheon has prepared and published (in one
discrete document) a detailed Stewardship Report addressing the Company's social
and environmental practices (i.e., the actions requested by the Proposal).
Raytheon is also aware that in Burlington Resources, Inc. (February 4, 2005),
the Staff did not permit exclusion (on substantial implementation grounds) of a
proposal that was substantially identical to the Proposal. However, at the time
of that proposal, Burlington Resources, Inc. had not published any documents
that resembled a "sustainability report." While Burlington Resources, Inc. had
publicly disclosed that it had formally commissioned a Corporate Social
Responsibility ("CSR") initiative, and envisioned that a "CSR Report" would be
an outgrowth of that initiative, "the specific form and substance of the report
had not been decided." Conversely, in Raytheon's case, the Stewardship Report
has been published and continues to be available to its shareholders and the
public on Raytheon's website.
With its Stewardship Report, Raytheon has published a company-wide review of
policies, practices and indicators relating to the subject matter of the
Proposal and has thus implemented the essential objectives of the Proposal. The
Proposal has, therefore, been substantially implemented.
2. Conclusion
For the foregoing reasons, we believe that the Proposal may be omitted from
Raytheon's 2008 proxy materials. Accordingly, we request the concurrence of the
Staff that it will not recommend enforcement action against Raytheon, should it
omit the Proposal from its 2008 proxy materials.
If you have any questions regarding this matter or require any additional
information, please contact the undersigned at 781-522-3036. If the Staff
disagrees with any of the conclusions set forth above, please contact the
undersigned prior to the issuance of a written response. Please be advised that
Raytheon now estimates that it will send the 2008 Proxy Statement to a financial
printer on or about April 15, 2008 and we therefore respectfully request that
the Staff act promptly on the request set forth in this letter.
Very truly yours,
/s/
Mark D. Nielsen
cc: Patrick Doherty, New York City Office of the Comptroller
[STAFF REPLY LETTER]
February 15, 2008
Mark D. Nielsen
Vice President-Legal
Corporate Governance
Raytheon Company
870 Winter Street
Waltham, MA 02451-1449
Re: Raytheon Company
Dear Mr. Nielsen:
This is in regard to your letter dated February 12, 2008 concerning the
shareholder proposal submitted by the New York City Employees' Retirement
System, the New York City Teachers' Retirement System, the New York City Police
Pension Fund, the New York City Fire Department Pension Fund, and the New York
City Board of Education Retirement System for inclusion in Raytheon's proxy
materials for its upcoming annual meeting of security holders. Your letter
indicates that the proponents have withdrawn the proposal, and that Raytheon
therefore withdraws its January 23, 2008 request for a no-action letter from the
Division. Because the matter is now moot, we will have no further comment.
Sincerely,
/s/
Gregory Belliston Special Counsel
cc: Patrick Doherty
Bureau of Asset Management
The City of New York
Office of the Comptroller
1 Centre Street
New York, NY 10007-2341 |
