GENERAL DYNAMICS CORP (GD)
Sector: Industrials
2026 Annual Meeting Analysis
GENERAL DYNAMICS CORP · Meeting: May 6, 2026
Directors FOR
12
Directors AGAINST
0
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Directors
Clarke joined in February 2023, which is within the 24-month exemption window, so the TSR trigger does not apply; he has no attendance issues and brings deep defense and national security expertise relevant to General Dynamics.
No TSR trigger applies — GD's 3-year return of +63.8% exceeds the peer group median by +1.7pp, well below the 65pp threshold required to fire a vote against; deLeon has strong aerospace and defense industry experience and satisfactory attendance.
No TSR trigger applies given GD's strong positive 3-year return and only +1.7pp gap versus peer median; Haney serves on the Audit Committee with relevant oversight experience and serves on one other public board, well within the overboarding limit.
Hooper joined in June 2023, placing him within the 24-month new-director exemption period, so the TSR trigger is not applied; he holds two other public board seats, within policy limits, and brings relevant defense and government experience.
No TSR trigger fires given GD's strong outperformance relative to the peer group; Malcolm is designated an Audit Committee Financial Expert and has no attendance, overboarding, or independence concerns.
As Chairman and CEO and an executive director, Novakovic is subject to the same TSR trigger as all other directors, but no trigger fires given GD's peer-group outperformance; she holds one outside board seat (J.P. Morgan Chase), within the one-seat limit for sitting CEOs under our policy.
No TSR or overboarding trigger applies; Nye is a sitting CEO at Martin Marietta Materials and holds one outside public board seat (General Dynamics), which satisfies the policy requirement that a sitting CEO hold no more than two outside seats; he is also designated an Audit Committee Financial Expert.
No TSR trigger applies; Reynolds is a certified public accountant and designated Audit Committee Financial Expert, holds one other public board seat, and has no attendance or independence concerns.
No TSR trigger fires; Schumacher serves as independent Lead Director and Compensation Committee Chair with strong governance credentials, holds one outside board seat, and the company's pay practices show no issues requiring her accountability as committee chair.
No TSR trigger applies; Steel holds one outside public board seat (Perella Weinberg Partners), within policy limits, and brings deep financial markets and sustainability expertise with no attendance or independence concerns.
No TSR trigger applies; Stratton's role at Frontier Communications ended in January 2026, and he currently holds one active outside public board seat (Abbott Laboratories), within policy limits, with relevant technology and operations experience.
No TSR trigger applies; Wall holds no other public company board seats and brings deep international defense and military expertise relevant to General Dynamics' business with no attendance or independence concerns.
All 12 director nominees pass the policy screens. GD's 3-year price return of +63.8% exceeds the peer group median by +1.7pp, far below the 65pp underperformance threshold required to trigger a vote against any director. Two directors (Clarke, Hooper) joined within the past 24 months and are exempt from the TSR trigger regardless. No overboarding issues exist — the one sitting CEO on the board (Nye) holds only one outside board seat, and the executive director (Novakovic) holds one outside board seat. Attendance averaged 99.5% across all board and committee meetings. The board discloses a skills matrix and maintains a strong independent majority (11 of 12 nominees are independent).
Say on Pay
✓ FORCEO
Phebe N. Novakovic
Total Comp
$25,924,082
Prior Support
96%%
CEO total compensation of approximately $25.9 million is broadly consistent with the market for a chairman-CEO role at a large-cap defense and aerospace company of GD's scale ($94.5B market cap, $52.6B in revenue), and prior-year say-on-pay support was an extremely strong 96%, indicating no significant shareholder dissatisfaction. The pay program is well-structured: roughly 80% of CEO compensation is variable and performance-linked (50% performance stock awards tied to 3-year ROIC with a relative total shareholder return modifier, 30% stock options, and 20% restricted stock), with the annual incentive based on measurable financial metrics including earnings per share, free cash flow, and operating margin. Pay-for-performance alignment is demonstrated — GD delivered record revenue, earnings, and free cash flow in 2025, and the company's 3-year total shareholder return of +63.8% is essentially in line with the peer group median (+62.1%), showing that incentive pay was earned in the context of genuine shareholder returns.
Auditor Ratification
✓ FORAuditor
KPMG LLP
Tenure
24 yrs
Audit Fees
$25,504,000
Non-Audit Fees
$3,264,000
KPMG has audited General Dynamics since 2002, giving it approximately 24 years of tenure — one year below the 25-year threshold that would trigger a vote against. Non-audit fees (audit-related fees of $1,989,000 plus tax fees of $1,128,000 plus other fees of $147,000, totaling $3,264,000) represent about 12.8% of core audit fees of $25,504,000, well below the 50% threshold that would raise independence concerns. No material restatements are disclosed and KPMG is a Big 4 firm appropriate for a company of GD's size and complexity.
Overall Assessment
General Dynamics' 2026 annual meeting ballot contains three proposals — director elections, auditor ratification, and executive compensation — all of which pass the applicable policy screens and receive a FOR determination. The company's strong 3-year total shareholder return, well-structured pay program with a 96% prior-year say-on-pay approval rate, and a clean auditor fee ratio (non-audit fees at approximately 12.8% of audit fees) provide no basis for concern across any of the three votes.
Compensation Peer Group
14 companies disclosed in 2026 proxy filing