# Senators Urge Pentagon to Codify Contractor Policy

Senators Mike Lee and Elizabeth Warren are urging the Department of War to support legislation codifying a January 2026 executive order that links certain defense contractors’ executive compensation and shareholder payouts to performance and investment in production capacity. Their bipartisan review found that combined buybacks and dividends at Lockheed Martin, RTX, Northrop Grumman, and General Dynamics declined 36% from Q1 2025 to Q1 2026, a change that coincided with the order but does not establish causation. For procurement professionals and contractors, the proposal signals continued attention to delivery performance, cost and schedule results, and production investment; codification would require legislation and has not been reported as enacted.

- Defense contractors should assess how executive compensation, shareholder distributions, and production-capacity investments may be scrutinized alongside contract delivery, cost, and schedule performance.
- Procurement teams may need to account for potential legislative changes if the proposal advances; the signal does not identify specific contract modifications or new mandatory requirements.
- Lockheed Martin, RTX, Northrop Grumman, and General Dynamics are the firms cited in the payout comparison, making the review particularly relevant to major defense suppliers and their subcontractor networks.

**Jurisdictions:** federal
**Industries:** Defense & Military
**Topics:** Policy
**Published:** November 13, 2026

### Government Entities
- Department of War (DoW)
- U.S. Senate
- Congress

### Vendors
- Lockheed Martin ()
- RTX ()
- Northrop Grumman ()
- General Dynamics ()

### Sources
- [Lee, Warren Urge Pentagon to Codify Trump’s Successful EO to Cut Defense Waste, Boost Efficiency - Senator Mike Lee](https://www.lee.senate.gov/news/press-releases/lee-warren-urge-pentagon-to-codify-trumps-successful-eo-to-cut-defense-waste-boost-efficiency/) - LEE