CORPORATE RESPONSIBILITY REPORT

2013 CORPORATE RESPONSIBILITY REPORT

OUR VALUES We, the women nd men of NORTHROP GRUMMAN, re guided by the following Vlues. They describe our compny s we wnt it to be. We wnt our decisions nd ctions to demonstrte these Vlues. We believe tht putting our vlues into prctice cretes long-term benefits for shreholders, customers, employees, suppliers, nd the communities we serve. We tke responsibility for QUALITY. Our products nd services will be best-in-clss in terms of vlue received for dollrs pid. We will deliver excellence, strive for continuous improvement, nd respond vigorously to chnge. Ech of us is responsible for the qulity of whtever we do. We deliver CUSTOMER stisfction. We re dedicted to stisfying our customers. We believe in respecting our customers, listening to their requests nd understnding their expecttions. We strive to exceed their expecttions in ffordbility, qulity nd on-time delivery. We provide LEADERSHIP s compny nd s individuls. Northrop Grummn s ledership is founded on tlented employees effectively pplying dvnced technology, innovtive mnufcturing, nd sound business mngement. We dd more vlue t lower cost with fster response. We ech led through our competence, cretivity, nd temwork. We ct with INTEGRITY in ll we do. We re ech personlly ccountble for the highest stndrds of behvior, including honesty nd firness in ll spects of our work. We fulfill our commitments s responsible citizens nd employees. We consistently tret customers nd compny resources with the respect they deserve. We vlue Northrop Grummn PEOPLE. We tret one nother with respect nd tke pride in the significnt contributions tht come from the diversity of individuls nd ides. Our continued success requires us to provide the eduction nd development needed to help our people grow. We re committed to openness nd trust in ll reltionships. We regrd our SUPPLIERS s essentil tem members. We owe our suppliers the sme type of respect we show to our customers. Our suppliers deserve fir nd equitble tretment, cler greements, nd honest feedbck on performnce. We consider our suppliers needs in conducting ll spects of our business.

TABLE OF CONTENTS OUR COMPANY Our Business ------------------------------------------------ 2 Our Ethics --------------------------------------------------- 5 Our Governnce----------------------------------------------- 8 OUR OPERATIONS IN FOCUS Diversity nd Inclusion ----------------------------------------11 Supplier Responsibility nd Diversity --------------------------- 15 Environmentl, Helth, nd Sfety ------------------------------ 19 OUR COMMUNITY INVESTMENT Eduction--------------------------------------------------- 31 Volunteerism ----------------------------------------------- 37 Disster Relief ---------------------------------------------- 38 Militry nd Veterns----------------------------------------- 38 GRI CONTENT INDEX----------------------------------- 40

INTRODUCTION The Vlue of Performnce Begins with Responsibility We published our first Northrop Grummn Corporte Responsibility Report in 2008, which highlighted our environmentl nd socil performnce in 2007. Our reporting continues to focus on the environmentl nd socil responsibilities criticl to our key stkeholders including shreholders, customers, employees, locl communities, governments, prtners, nd suppliers. We report consistent with the Globl Reporting Inititive (GRI), third-prty orgniztion tht hs developed widely used environmentl, socil, nd governnce reporting frmework. To enhnce technicl qulity, credibility, nd relevnce of our reporting, the GRI reporting frmework is developed through consensus-seeking process with prticipnts drwn globlly from business, civil society, lbor, nd professionl institutions. This is nother step in our ongoing effort to improve trnsprency nd ccountbility in ll we do. This report will be submitted for GRI Level Check, which evlutes the extent to which the GRI guidelines re met in the report. Further, for the third consecutive yer, we ssembled nd engged n independent Externl Review Pnel to provide feedbck nd dvice from stkeholder perspective. This report reflects feedbck received from the pnel on our 2012 Corporte Responsibility Report.

INTRODUCTION I m very proud of our employees, who re reflecting the compny s vlues through their ctions every dy. As this report detils, Northrop Grummn continues to mke significnt positive impcts in the communities where we live nd work. Wes Bush, Chirmn, Chief Executive Officer, nd President Northrop Grummn Corportion We t Northrop Grummn re committed to be top-performing compny for our customers, shreholders, nd employees. It is our objective to sustin top performnce over the long term. To chieve tht objective, we believe tht our compny must operte on foundtion of strong vlues tht includes: A stedfst commitment to ethics, integrity, nd complince Effective corporte governnce nd ledership A diverse nd highly engged workforce operting in sfe nd inclusive environment Dediction to qulity nd customer stisfction Effective prtnership with suppliers nd other business prtners Conducting our opertions in n environmentlly sustinble mnner Effective corporte citizenship progrms to dvnce eduction, support militry service members nd their fmilies, nd prtner with the community leders nd groups where our employees live nd work. Our commitment t Northrop Grummn to ethicl behvior remins stedfst. Our ethics progrm goes beyond complince with lws nd regultions, focusing on instilling nd communicting our compny vlues to mngement nd employees to promote the highest ethicl stndrds in ll tht we do. Our compny ledership s role is essentil. One exmple of our ledership tem s focus on ethics ws demonstrted during our 2013 Ethics Awreness Week where our senior leders cross the compny prticipted in events to spek directly with employees bout the importnce of ethics. Ech yer we exmine our corporte governnce to ensure we re meeting our commitment to shreholders nd other stkeholders, updting policies where we see greter trnsprency is desirble. While we hve lwys operted our compny in mnner respectful of humn rights, in 2013 we formlized our commitment by dopting humn rights policy tht requires treting employees, suppliers, customers, nd competitors with dignity nd respect. Sustining our performnce t high levels is not possible without diverse workplce tht embrces inclusion. We re very proud of the gret work of our employee resource groups consisting of more thn 14,000 employees cross the enterprise. In 2013, we dopted severl new diversity nd inclusion inititives nd enhnced existing inititives, including incresing support for veterns, disbled employees, nd our lesbin/gy/ bisexul/trnsgender (LGBT) collegues. We gretly vlue our 9,500 suppliers for their significnt contributions to our success. Through our Smll Business Innovtion Reserch progrm nd other socio-economic business progrms, we mentor nd prtner with smll firms to help them develop nd contribute to gme-chnging technology solutions for our customers. Employee sfety nd environmentl sustinbility re vitl to our performnce nd we re committed to improving our performnce in these res. Lst yer we chieved our greenhouse gs reduction gol two yers hed of pln nd were recognized s leder in this re by CDP (formerly the Crbon Disclosure Project). Mintining employee sfety is prmount to our mission nd opertions, nd it continues to be prt of our incentive performnce metrics. In corporte citizenship, we continued to support science, technology, engineering, nd mth progrms for students from grde school through college, nd to ssist veterns, service members, nd their fmilies. We sponsor, with the Air Force Assocition, the CyberPtriot progrm to excite high school students bout creers in cybersecurity. Every yer, this progrm hs expnded in populrity nd prticiption. We lso initited new effort in 2013 to id homeless nd low-income veterns. As we continue to increse our globl presence, we hve expnded our interntionl corporte citizenship strtegy, ensuring tht our commitment to the communities in which we work nd live extends with our new globl business ventures. I m very proud of our employees, who re reflecting the Compny s vlues through their ctions every dy. As this report detils, Northrop Grummn continues to mke significnt positive impcts in the communities where we live nd work while sustining our opertionl performnce nd delivering high-qulity, innovtive, nd ffordble solutions to our customers. Just s noteworthy, the report identifies our opportunities for improvement, which we intend to ddress proctively. As tem dedicted to top performnce, we re lwys focused on improving. Thnk you for your interest in our compny nd our commitment to corporte responsibility. Wes Bush, Chirmn, CEO, nd President

OUR COMPANY OUR BUSINESS Who We Are Northrop Grummn is publicly trded compny hedqurtered in Flls Church, Virgini. We employ pproximtely 65,000 people. Our stock is listed on the New York Stock Exchnge under the symbol NOC. We re leding globl security compny providing innovtive systems, products, nd solutions in unmnned systems; cyber, Commnd, Control, Communictions, Computers, Intelligence, Surveillnce nd Reconnissnce (C4ISR); nd logistics nd moderniztion to government nd commercil customers worldwide. We pply our core competencies nd innovtive cpbilities to ddress the diverse nd complex issues fcing our customers, including the defense of our ntion nd llies, cybersecurity, homelnd security, expnding the scientific frontiers of spce, environmentl nd climte chnge, nd lrge-scle civil informtion systems tht enhnce government services. As prime contrctor, principl subcontrctor, prtner, or preferred supplier, we prticipte in mny high-priority ntionl security technology progrms in the United Sttes nd cross the globe. We conduct most of our business with the U.S. federl government, principlly the Deprtment of Defense (DoD) nd intelligence community. We lso conduct business with locl, stte, nd interntionl governments, nd domestic nd interntionl commercil customers. Revenue from government contrcts, which excludes non-u.s. militry sles, ccounted for 89 percent in 2011, 88 percent in 2012, nd 86 percent in 2013 of totl compny revenues. A key element of Northrop Grummn s growth strtegy is our commitment to the interntionl mrketplce. We hve rnge of industry-leding cpbilities vilble for interntionl mrkets, nd we sell products nd services to customers in 25 ntions. Northrop Grummn hs well-estblished globl presence outside the United Sttes, nd we mintin n extensive network of regionl offices nd locl businesses serving customers in key mrkets in Europe, the Middle Est, nd Asi Pcific regions. 2

OUR COMPANY 2013 Highlights Delivering solutions: In 2013, we generted $24.7 billion in sles. Risks nd opportunities: One of the biggest chllenges the compny fced in 2013 ws the uncertinty surrrounding the federl budget nd funding for our products nd services. While budgets were tighter, our customers responsibilities hve not been reduced. They continue to count on Northrop Grummn to be both innovtive nd more ffordble in providing products nd services. As the demnds on customers increse, we re tking the ctions necessry to ensure we re best prepred to continue to serve our customers needs well. Our focus on delivering top performnce, ensuring the highest level of qulity, mintining close communiction with our customers, nd pplying innovtive pproches to deliver more ffordble products nd services, while mintining our commitment to ethics nd integrity, contributes to our customers bility to ddress their globl security missions. We hve four operting sectors: AEROSPACE SYSTEMS: A leder in the design, development, integrtion, nd production of mnned ircrft, unmnned systems, spcecrft, high-energy lser systems, microelectronics, nd other systems nd subsystems. Our Aerospce Systems customers, primrily U.S. government gencies, use these systems in mission res including intelligence, surveillnce nd reconnissnce (ISR), communictions, bttle mngement, strike opertions, electronic wrfre, erth observtion, stellite communictions, spce science, nd spce explortion. NORTHROP GRUMMAN SNAPSHOT Number of employees: Approximtely 65,000 Sles: 2013: $24.7 billion 2012: $25.2 billion Operting mrgin rte: 2013: 12.7% 2012: 12.4% Net ernings: 2013: $2.0 billion 2012: $2.0 billion Diluted ernings per shre: 2013: $8.35 2012: $7.81 ELECTRONIC SYSTEMS: A leder in the design, development, mnufcture, nd support of solutions for sensing, understnding, nticipting, nd controlling the operting environment for our globl militry, civil, nd commercil customers. Through Electronic Systems, we provide vriety of defense electronics nd systems, irborne fire control rdrs, situtionl wreness systems, erly wrning systems, irspce mngement systems, nvigtion systems, communictions systems, mrine power nd propulsion systems, spce systems, nd logistics services. INFORMATION SYSTEMS: A leding globl provider of dvnced solutions for the Deprtment of Defense, ntionl intelligence, federl civilin nd stte gencies, commercil, nd interntionl customers. Products nd services focus on the fields 3

OUR COMPANY 4 of commnd nd control (C2), communictions, cybersecurity, ir nd missile defense, intelligence processing, civil security, helth informtion technology, government support systems, nd systems engineering nd integrtion. TECHNICAL SERVICES: A leder in innovtive nd ffordble logistics, moderniztion, nd sustinment support. Through Technicl Services, we lso provide n rry of other dvnced technology nd engineering services, including spce, missile defense, nucler security, trining, nd simultion. Customers At Northrop Grummn, we re ccountble to our customers. We tke very seriously our commitment to globl security nd the tremendous responsibilities inherent in tht duty. We recognize tht the work we do mtters to our world tody nd in the future. We embrce our prtnership with U.S. nd llied defense nd security leders to provide high-qulity, ffordble products nd systems through robust mission-ssurnce process tht emphsizes our compny-wide focus on qulity, innovtion, nd superior progrm performnce. 2013 Mjor Gols We work ech dy to serve our customers, nd we work proctively with our business prtners to be good citizens in the communities where we work nd live. To demonstrte our commitment to perform responsibly, we highlight below our mjor Corporte Responsibility Report s Gols for 2013 nd our performnce reltive to those gols. GOAL Provide high-qulity, innovtive, nd ffordble products nd systems in support of the U.S. militry nd our llies in their missions to operte successfully nywhere on the globe. This involves confronting irregulr wrfre including terrorism nd ddressing globl security chllenges, with focus in the following primry ctegories: Unmnned Systems Cyber Commnd, Control, Communictions, Computers, Intelligence, Surveillnce nd Reconnissnce (C4ISR) Logistics nd Moderniztion 2013 PERFORMANCE Our tem continues to deliver outstnding products nd services to our customers nd finncil performnce results for our shreholders. We re consistently working to improve our performnce in everything we do. We strive to be the top-performing compny in our industry, providing our customers with unique cpbilities to continue to pursue their missions ffordbly. GOAL In our worldwide opertions, focus on doing business consistent with our vlues nd commitment to sustinbility. Incorporte socil responsibility nd customer support into decision-mking, including in the products we develop nd mnufcture, nd the services we provide within the mrket. PERFORMANCE We currently do not mnufcture or develop ntipersonnel mines, cluster munitions, depleted urnium munitions, chemicl, or biologicl wepons. Qulity GOAL Ensure mission success for our customers, strong performnce for our shreholders, nd sustined focus on performnce improvement. PERFORMANCE In 2013, we mintined our focus on qulity s one of our key strtegic priorities to ensure strong performnce outcomes for our customers nd improved vlue for our shreholders. We continued using qulity mesures compny-wide tht reflect the performnce of our key progrms ginst qulity expecttions cross the progrm life cycle, including engineering, mnufcturing, nd supply chin. We recognize tht holistic view of our qulity performnce, engging ll key stkeholders, drives successful performnce outcomes for our customers. To identify nd prioritize res for continuous qulity improvement, we implemented rigorous self-ssessment process t both the business-unit nd corporte level. We lso trgeted qulity improvement inititives to enhnce the vlue we deliver to our customers. We continue to promote the reltionship between the work of our individul employees nd the success of our customers criticl missions. This is criticl to sustined performnce improvement nd ffordble globl security solutions. We do this in prt by instilling in our employees the concept tht Qulity is Personl. From there, we encourge our employees to identify qulity issues in their work nd strive continuously to improve in those res. From time to time, s do ll compnies, we experience isolted, progrm-specific qulity issues tht do not meet the performnce expecttions of Northrop Grummn or our customers. To minimize the potentil for qulity issues, we focus on: Improving the connection between the work of the individul nd qulity outcomes for our customers Using robust root-cuse ssessment process

OUR COMPANY Instilling focus on qulity erly in progrm life cycle to help void qulity issues s progrms mture Prtnering with our suppliers to ensure cler understnding of qulity expecttions nd speedy identifiction nd resolution of qulity problems OUR ETHICS Top Performnce through Ethics, Integrity, nd Complince At Northrop Grummn, we strive to deliver qulity products nd services, never losing sight of our commitment to ethics, integrity, nd complince. We hve comprehensive vlues-bsed culture tht promotes strong focus on ethics t every level throughout the compny. Internlly, through regulr communictions, we set high expecttions for ethicl conduct for ll our employees. We lso sty pprised of regultory chnges nd leding-edge ethicl considertions, nd deploy focused nd timely trining to our employees on criticl ethics nd complince obligtions. We continully reinforce our belief tht ethics nd integrity re integrl to ll we do. Key Elements of Our Ethics nd Complince Progrm Include: Ongoing trining nd communiction Comprehensive complince policies nd procedures Business conduct officers OpenLine Strong enforcement of our policy ginst retlition 2013 Highlights Re-orgnized the ethics deprtment to ensure common processes Focused on our globl progrms including ppointing mnger of globl integrity Lunched Culture Committee to look for common trends cross functionl res nd estblish ctions throughout the compny Rolled out Ethics Awreness Week cross the compny, with more thn 60 executive leders chmpioning more thn 80 events to promote ethics wreness t 70 loctions cross the compny 2013 Mjor Gols GOAL Mintin n effective nd well-functioning ethics progrm. PERFORMANCE We conducted n internl review of our ethics progrm during 2013 nd confirmed tht it ws effective nd well-fuctioning. GOAL Trin 100 percent of our employee popultion on ethics nd complince topics. PERFORMANCE Globlly, more thn 99 percent of Northrop Grummn employees completed our 2013 ethics nd complince trining. We conduct vrious risk ssessments throughout the yer relted to our ethics nd complince progrms, which helps us provide our employees with complince trining tilored to the risks of their respective roles. Our complince trining spns wide rnge of substntive res. In 2013, our employees received ethics nd complince trining through in-person sessions, computerbsed tutorils, nd printed mteril. Trining in 2013 included progrms trgeted to employee job responsibilities in the following criticl res: During 2013, Northrop Grummn employees received ongoing ethics communictions from mngers nd compny leders, including messges from Chirmn, CEO nd President Wes Bush highlighting our 2013 theme, Ethics: The Foundtion of Performnce. Globl Trde Complince Informtion Security Insider Trding Protecting Personl Informtion Preventing Workplce Violence Socil Medi Employees lso received The High Rod, compnywide ethics newsletter feturing rticles bout the Northrop Grummn OpenLine, business courtesies, secondry employment, retlition, nd humn trfficking. The newsletter lso reports nd highlights our OpenLine sttistics nd spects of corrective ctions to provide trnsprency to our employees. 5

OUR COMPANY Business Conduct Officers To support our high ethicl stndrds, we use Business Conduct Officer (BCO) network. As of 2013, our BCO network consisted of pproximtely 125 full-time nd prt-time BCOs round the globe promoting ethics, nswering mngement nd employee questions, nd elevting the ethics progrm t the site level. Throughout the yer, these officers conduct meet-nd-greet events to rise the wreness of the ethics progrm. We encourge our employees to prticipte in vriety of onsite nd online ethics wreness ctivities nd contests to ensure our vlues re n integrl prt of our everydy behvior nd culture. Reporting Structure The ethics office, led by the vice president of globl corporte responsibility, reports qurterly to the Audit Committee of the Bord of Directors nd nnully to the Policy Committee of the Bord of Directors. To ensure the pproprite tone from the top, the corporte responsibility reporting chin includes the highest level of mngement of our compny: CHIEF EXECUTIVE OFFICER p VICE PRESIDENT OF GLOBAL CORPORATE RESPONSIBILITY p CORPORATE DIRECTOR OF ETHICS AND BUSINESS CONDUCT p SECTOR DIRECTORS OF ETHICS AND BUSINESS CONDUCT p BUSINESS CONDUCT OFFICERS (pproximtely 125 full- nd prt-time employees positioned throughout the compny) We orgnize workshops for both our U.S. nd interntionl BCOs. These workshops include shring best prctices, progrm updtes, complince nd skill trining, nd networking. We hold monthly webinr series to ensure our BCOs re knowledgeble of the ltest developments on key topics such s qulity, business courtesies, root cuse nlysis of ethics nd complince issues, nd nti-corruption. EMPLOYEE RESOURCES: 2013 OPENLINE CONTACTS WHAT: Employees nd third prties cn seek guidnce on ethics questions nd report suspected violtions of lws, regultions, or compny policy by contcting, mong others, BCO, emiling or clling the ethics office, submitting web report, or clling our toll-free OpenLine. OpenLine is dministered by third-prty service provider to permit nonymous, 24/7 reporting. In ddition, n online reporting system is vilble to employees long with OpenLine phone numbers in Europe nd Asi. HOW: The OpenLine system llows us to trck clls by totl number nd type of contcts, by sector, by llegtions (with nd without merit), nd by disciplinry ction rendered. Reports nd metrics provide trending dt to help us trget trining nd communictions to employees to strengthen ethics. We publish ongoing results in our The High Rod newsletter. RESULT: We hd totl of 2,332 OpenLine contcts in 2013, including 1,087 questions on policies nd procedures, nd 1,245 rising potentil complince nd ethics concerns. We took vrious disciplinry ctions including termintion of 60 employees for their ethicl nd business conduct violtions. The mjority of the termintions were due to inccurte time reporting; however, we lso hd few termintions due to filure to comply with qulity/mnufcturing requirements nd misuse of compny resources. This dt is limited to reports of llegtions nd concerns mde through our OpenLine process. 2013 OPENLINE CONTACTS Inquiries Allegtions 53% Almost hlf of contcts re chrcterized s inquiries. 47% 2011-2013 Compred Dt 2011 2012 2013 +/- from 2012 INQUIRIES 1,097 1,148 1,087-5% ALLEGATIONS 1,250 1,231 1,234 0% TOTAL 2,347 2,379 2,332-2% 6

Commitment OUR COMPANY We re fully committed to complying with pplicble nti-corruption lws in every country in which we operte. We mintin zero tolernce for corruption. At Northrop Grummn, we regulrly evlute the bredth nd strength of our internl nti-corruption progrm. We ssess our progrm nd performnce ginst stndrds nd benchmrks set by the U.S. government in Foreign Corrupt Prctices Act (FCPA) settlement ctions, the U.S. Federl Sentencing Commission, the Orgniztion for Economic Coopertion nd Development, nd the U.K. Ministry of Justice, mong others. Our compny stndrds cover wide vriety of governnce mtters including internl policies nd procedures; business risk ssessments; business courtesy restrictions; due diligence of subcontrctors, suppliers, nd prtners; trining nd communiction; interntionl controls enforcement, nd continul process improvement. A Step Above Abiding by the pplicble nti-corruption lws of the countries in which we operte, nd dhering to internl policies nd procedures, is only strting point. We continue to work to promote culture of ethicl behvior tht further reduces the risk of corrupt behvior. Strong Foundtion We re ctive leders nd supporters of numerous inititives nd orgniztions with the primry purpose of elevting good corporte governnce including: DEFENSE INDUSTRY INITIATIVE (DII) ON BUSINESS ETHICS AND CONDUCT INTERNATIONAL FORUM FOR BUSINESS ETHICAL CONDUCT (IFBEC) TRACE INTERNATIONAL TRANSPARENCY INTERNATIONAL (USA) Wes Bush, chirmn, CEO, nd president, prticipted in CEO pnel t the 2013 Defense Industry Inititive Best Prctices Forum, where he discussed the importnce of ethics nd integrity to n udience of more thn 400 ethics professionls from the defense industry. ENSURING COMPLIANCE: POLICIES, PROCEDURES, AND PRACTICE We prohibit nyone conducting business on behlf of Northrop Grummn, including directors, officers, employees, consultnts, representtives, distributors, suppliers, nd other third prties, from offering or mking ny improper pyments of money or nything of vlue to ny of our business ssocites including government officils, politicl prties, prty officils, cndidtes for public office, nd commercil suppliers nd customers. We mintin robust complince progrm tht includes n internl system of reviews nd pprovls governing the retention of third prties tht support the compny s business opertions. We prohibit fcilitting pyments such s those mde to expedite or secure performnce of routine governmentl ction such s obtining vis or customs clernce, except in cses where there is n imminent thret to n individul s life, helth, or sfety. We trin our employees to void situtions tht would result in, or give the ppernce of, conflict between personl interests nd the interests of the compny. Employees re required to complete n nnul conflict of interest disclosure form to ensure job performnce is not improperly influenced by outside fctors. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. 7

OUR COMPANY OUR GOVERNANCE The Bord of Directors hs dopted Principles of Corporte Governnce tht lign with nd reinforce our vlues nd strong commitment to ethics nd integrity. Our commitment ensures tht integrity is t the center of ll our ctions, from our Bord of Directors nd compny leders to ech employee on the line. You cn find these principles in their entirety on our compny website t www.northropgrummn.com. They lso re vilble in print to shreholders by request. 2013 Mjor Gols GOAL Foster the long-term success of the compny nd promote the interests of stockholders through best-in-clss corporte governnce. PERFORMANCE The Bord s commitment to its shreholders is evident in the re of corporte responsibility. We nnully provide n overview of our corporte governnce policies nd procedures in our proxy sttement, which is vilble to shreholders. Our Principles of Corporte Governnce reflect our compny vlues nd provide for effective nd responsible business prctices. These principles, long with our Certificte of Incorportion nd Bylws nd chrters of the vrious committees of the Bord, provide n overll frmework for the compny s governnce. The dy-to-dy business nd ffirs of the compny re conducted by our officers nd employees under the direction of Chirmn, CEO, nd President Wes Bush with oversight by the Bord. All Bord members re expected to ct with integrity nd to mintin high ethicl stndrds t ll times. The compny s Stndrds of Business Conduct pply to ll directors. One of the independent Bord members hs been designted s the led independent director. In tht role, the led independent director presides t meetings of the Bord t which the chirmn of the Bord is not present, including executive sessions of the independent directors. The led independent director pproves the Bord clendr nd meeting gends, interviews cndidtes for the Bord, nd hs uthority to cll meetings of the independent directors. Ech yer the full Bord nd Bord committees conduct n ssessment of their performnce. The led independent director lso tlks with ech director on n individul bsis to ssess director performnce. We ct with INTEGRITY in ll we do. We re ech personlly ccountble for the highest stndrds of behvior, including honesty nd firness in ll spects of our work. Governnce Overview The Bord periodiclly reviews the Principles of Corporte Governnce to determine whether they should be modified in response to chnged circumstnces or legl or other requirements. Over the yers, the Bord hs modified these principles nd will continue to do so s pproprite to dvnce the interests of the compny s shreholders. Cndidtes for service on the Bord re crefully evluted on the bsis of severl fctors, including personl nd professionl integrity, eduction, professionl bckground, experience, willingness to pply for nd retin top-secret security clernce, nd bility to contribute to the compny s objectives. Although the Bord does not hve forml policy regrding the diversity stndrds to be considered when evluting director cndidtes, its objective is to foster diversity including of thought, experience, nd contribution mong our directors. 8

GRI S02-S08 STANDARDS OF BUSINESS CONDUCT In the United Sttes nd Asi we hve n OpenLine operted by n independent third prty tht is vilble 24 hours dy, seven dys week. We investigte llegtions of violtions of lw or compny policy nd, when llegtions hve merit, dminister pproprite discipline including termintion. We hve lwys hd strong commitment to humn rights, which is reflected in our business prctices. In the lst yer, we dopted forml Humn Rights policy tht highlights our commitment to tret employees, suppliers, customers, nd competitors with dignity nd respect nd not tolerte discrimintion, hrssment, or retlition. Additionlly the policy covers freedom of ssocition, fir working conditions, ethicl procurement prctices, helth nd sfety of employees nd business ssocites, protection of the environment, nd the wellbeing of our communities. When we prticipte in the politicl process t the federl, stte, nd locl level in the United Sttes, we do so consistent with ll legl requirements. We provide informtion regrding federl politicl contributions mde by the Employees of Northrop Grummn Politicl Action Committee (ENGPAC), our policy regrding independent politicl expenditures, nd our trde ssocition memberships on the Northrop Grummn website, where informtion is quickly nd esily ccessible to our shreholders nd the public. As reported on the Northrop Grummn website, the ENGPAC contributed $2,139,250 to federl elections in clendr yer 2013 nd supported 311 cndidtes either through their re-election cmpign, Ledership PAC, or both. All of ENGPAC s contributions to politicl prties, politicl cndidtes, nd relted institutions were mde within the United Sttes. We disclose mteril litigtion, investigtions, nd penlties for noncomplince with lws nd regultions s pproprite in our public filings. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. CONTACT US Interested prties my communicte with ny of our directors by writing to them: c/o Secretry of the Corportion 2980 Firview Prk Drive Flls Church, VA 22042 9

OUR COMPANY Bord of Directors 2013 In September 2013, the Bord elected Willim Hernndez to the Bord of Directors, which incresed the Bord to 13 members. As of Dec. 31, 2013, 12 of the 13 Bord members were independent, non-employee directors. As of Dec. 31, 2013, 31 percent of the Northrop Grummn Bord is mde up of women nd people of color. The directors re: Wes Bush Chirmn, Chief Executive Officer, nd President, Northrop Grummn Victor H. Fzio Senior Advisor, Akin Gump Struss Huer & Feld LLP Former Member of Congress Donld E. Felsinger Led Independent Director, Northrop Grummn, Former Chirmn nd Chief Executive Officer, Sempr Energy Stephen E. Frnk Former Chirmn, President nd Chief Executive Officer, Southern Cliforni Edison Auln L. Peters Former Prtner, Gibson, Dunn & Crutcher Gry Roughed Admirl, United Sttes Nvy (Ret.) nd Former Chief of Nvl Opertions Thoms M. Schoewe Former Executive Vice President nd Chief Finncil Officer, Wl-Mrt Stores, Inc. Kevin W. Shrer Senior Lecturer t Hrvrd Business School Former Chirmn nd Chief Executive Officer, Amgen Bruce S. Gordon Former President nd CEO, NAACP nd Former President, Retil Mrkets Group, Verizon Communictions Willim H. Hernndez Former Senior Vice President nd Chief Finncil Officer, PPG Industries, Inc. Mdeleine A. Kleiner Former Executive Vice President nd Generl Counsel, Hilton Hotels Corportion Krl J. Krpek Former President nd Chief Operting Officer, United Technologies Corportion Richrd B. Myers Generl, United Sttes Air Force (Ret.) nd Former Chirmn of the Joint Chiefs of Stff DIRECTOR INDEPENDENCE: The Bord hs estblished n objective tht t lest 75 percent of the directors be independent directors s defined by the NYSE rules nd the compny s principles of corporte governnce. As of Dec. 31, 2013, the Bord of Directors is pproximtely 92 percent independent. BOARD PROTOCOL: The Bord of Directors hs pproved Principles of Corporte Governnce, which re ligned with nd support the compny s vlues. The Bord of Directors reviews the governnce principles nd seeks wys to enhnce the principles bsed on evolving circumstnces. The Principles of Corporte Governnce were revised on My 15, 2013, nd re posted on Northrop Grummn s website. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing,see GRI Content Index on pge 40. 10

OUR COMPANY OUR OPERATIONS IN FOCUS DIVERSITY AND INCLUSION At Northrop Grummn, we believe tht creting workplce tht fosters To tht end, we continue to develop ffilitions with vrious diversity diversity nd inclusion is pivotl to innovtion, improving productivity, orgniztions including the Ntionl Society of Blck Engineers, Society of enhncing enggement, nd boosting profitbility. Among our more thn Hispnic Professionl Engineers, Society of Women Engineers, Americn 65,000 employees, our gol is to chieve tlent bse of individuls whose Indin Science nd Engineering Society, nd other diversity-bsed professionl bckgrounds, chrcteristics, nd perspectives re s diverse s the globl ssocitions including those for people with disbilities, veterns, nd lesbin/ communities in which we work nd reside. Our collective diversity culture, gy/bisexul/trnsgender (LGBT) individuls. We continue to recruit tlented bckground, experience, thoughts, ides, nd work styles llows us to individuls through our reltionships with leding eductionl institutions nd design, build, nd provide some of the most sophisticted products nd ssocitions. Through these reltionships, we hire college grdutes who reflect services in our industry nd for our customers. the diversity of college nd university students ntionlly. Hlf of our college Our employees re our gretest ssets. Every success t Northrop Grummn new hires in the pst four yers hve been women or people of color. is the direct result of n mzing group of people. Our Globl Diversity nd Inclusion orgniztion is committed to enhncing tht foundtion of excellence, driving wreness of the vlue of inclusion nd promoting the integrl role of every individul. We demonstrte our commitment to the future through internl prtnerships designed to build pipeline of tlent, from entry-level to executive ledership. 11

OUR OPERATIONS 2013 Highlights Diversity, Inclusion, nd Enggement Our second Employee Resource Group Summit nd Diversity nd Inclusion Ledership Conference ws held in September in Chntilly, Virgini. This yer s theme of Diversity, Inclusion nd Enggement: Our Pth to Innovtion provided more thn 200 employees n opportunity to her from ntionlly known experts bout how to increse nd develop memberships in employee resource groups nd expnd on best prctices cross the orgniztion. Employee Resource Groups Shine Bright Our employee resource groups re committed to providing their members the opportunity to develop nd build ledership skills, rise wreness, educte others, nd give bck to the communities in which we work nd live. Ech yer, the vrious employee resource groups celebrte nd provide culturl wreness in the form of heritge month events. With more thn 11 events cross the country, they highlight vrious cultures nd popultions including Ntive Americns, veterns, nd disbled employees. At these heritge events, we provide support through employee resource group ctivities, compny-wide webcsts, nd live udience opportunities. One of our employee resource groups, PrIDA, our LGBT nd llies group, ws instrumentl in improving the effectiveness of compny policies nd enhncing our diversity nd inclusion efforts by ssisting with new progrm tht llows employees to voluntrily nd confidentilly self-identify s member of this popultion. Professionl development of members is prt of the mission of ech employee resource group. To tht end, we creted Professionl Development Series, which provides employee-designed nd led sessions tht ssist prticipnts with exploring creer skills. These include criticl thinking, executive presence, nd functionl nd domin competencies. 2013 SNAPSHOT: EMPLOYEE RESOURCE GROUPS In 2013, more thn 14,000 Northrop Grummn employees engged in 14 Employee Resource Groups in 173 chpters cross the compny, including those representing Africn Americns, Asin Pcific Islnders, Hispnics, Ntive Americns, women, people with disbilities, veterns, LGBT employees, young professionls, prents, genertions, nd environmentlists. All employees re welcome to join ny groups of their choosing. The mission: To ssimilte nd develop employees, by creting sense of belonging, s well s inviting employees to bring their whole self to work, creting more innovtive nd productive workforce. By providing development opportunities, leding community outrech efforts nd contributing to solving tody s business problems, employees feel more engged nd vlued by their peers nd mngers. An executive sponsor chmpions ech group by providing dvice nd guidnce to members. Employees get the opportunity to work longside executives tht provide visibility, ledership, nd professionl development opportunities. Our people with disbilities nd veterns groups hve been instrumentl in ssisting Northrop Grummn to prepre for new governmentl regultions on the hiring, employment, nd retention of individuls from these popultions. The development of trining progrms for mngers nd employees like encourges eduction nd wreness. 12

OUR OPERATIONS IN FOCUS OUR DIVERSITY COMMITMENT DATA AS OF AUGUST 2013 JOB CATEGORY TOTAL % MEN % WOMEN % WHITE % BLACK/ AFRICAN AMERICAN % HISPANIC/ LATINO % ASIAN % OTHER Exec/Senior Level Officils nd Mngers 208 74.52% 25.48% 85.10% 5.29% 2.88% 5.77%.96% First/Mid Level Officils nd Mngers 10,694 77.14% 22.86% 81.05% 5.67% 4.96% 6.86% 1.46% Professionls 38,736 73.32% 26.68% 71.41% 7.31% 6.53% 12.49% 2.27% Technicins 5,492 83.83% 16.17% 64.68% 10.18% 12.18% 10.36% 2.60% Administrtive 4,462 32.70% 67.30% 66.36% 14.30% 12.03% 4.24% 3.07% Crft Workers 4,104 91.74% 8.26% 61.28% 12.45% 18.88% 5.07% 2.32% Opertives 1,648 68.02% 31.98% 52.97% 14.81% 14.75% 13.83% 3.64% Lborers 182 74.73% 25.27% 41.21% 12.09% 37.36% 1.10% 8.24% Service Workers 344 75.00% 25.00% 51.16% 24.71% 17.73% 3.78% 2.62% TOTAL WORKFORCE 65,870 73.09% 26.91% 70.83% 8.36% 8.23% 10.31% 2.27% 2013 Mjor Gols GOAL Crete diverse pipeline of tlented professionls for senior ledership positions. PERFORMANCE In 2013, we mde severl orgniztionl chnges tht highlighted our top tlent. We chieved greter diversity in compny officers nd executive-level ppointments, long with creting n enterprise Tlent Cpture nd Redeployment orgniztion, which will identify nd promote high-potentil cndidtes including women nd people of color. We expnded the slte of diverse interview cndidtes by including middle mngement positions. In ddition, we estblished Globl Diversity nd Inclusion orgniztion to provide synergy nd leverge best prctices cross the orgniztion. Our vrious progrms develop top tlent by providing mentoring, coching, nd ledership skills tht focus on building diverse pipeline for the future. GOAL Improve the representtion of the compny s women, people of color, veterns, nd people with disbilities. PERFORMANCE The 2013 workforce comprised 27 percent women nd 29 percent people of color. We monitor our workforce representtion nd compre ourselves to externl benchmrks. In 2014, our veterns, people with disbilities nd LGBT self-identifiction progrm will be nlyzed to determine the effectiveness of inititives implemented within our orgniztion. GENDER RACE 2013 Diversity Highlights Voted Most Vluble Employer (militry) by Civilin Jobs.com nd Top 40 Militry Friendly Employer by G.I. Jobs. 26.91% Femle 73.09% Mle 70.83% White 29.17% People of Color Rnked #29 mong Top 50 Compnies in Diversity by DiversityInc. Mgzine. Voted Privte Sector Employer of the Yer by Creers & the Disbled Mgzine. Voted Top Compny for Employee Resource Groups by the Ntionl ERG Conference. 13

OUR OPERATIONS IN FOCUS Our Forml EEO/AAP Policy At Northrop Grummn, strong commitment to diversity nd inclusion is founded in written policies nd procedures tht mndte nondiscrimintory workplce supported by senior ledership. We dhere to Equl Employment Opportunity (EEO) nd Affirmtive Action (AA) principles nd policies, nd build them into our opertions cross the compny. We publish nnul Affirmtive Action plns tht document specific ctions to improve the representtion of minorities nd women nd to integrte veterns nd people with disbilities. These Affirmtive Action plns reflect our commitment to ensuring equl employment opportunities for qulified pplicnts nd employees without regrd to rce, color, religion, sex, or ntionl origin/ncestry. We dhere to policy of nondiscrimintion nd no hrssment consistent with pplicble, federl, stte, nd locl lws, including rce/ethnicity, color, ntionl origin, ncestry, sex/gender, gender identity/ expression, sexul orienttion, mritl/prentl sttus, pregnncy/childbirth or relted conditions, religion, creed, ge, disbility, genetic informtion, militry service/vetern sttus, disbled vetern, recently seprted vetern, other protected vetern, Armed Forces service medl vetern, or ny other protected sttus. This includes the commitment to mintin working environment free from hrssment nd bullying. GRI LA1-LA5, LA10-12, HR1, HR3-5, HR8 Humn rights including lbor nd mngement reltions, nondiscrimintion, trining nd eduction, security, nd indigenous rights At Northrop Grummn, developing our people goes beyond fulfilling strtegic priority our vlues-bsed focus provides the frmework to help ech individul employee mximize his or her potentil. Diversity nd inclusion re fundmentl for our business, nd we tke pride in recognizing tht ech individul s development needs re unique. Employment: Our employees who re regulrly scheduled to work 20 or more hours per week re eligible for helth nd welfre benefits under the Northrop Grummn Helth Pln. Qulified full-time nd prt-time employees re eligible for the 401(k) pln nd pension pln. Temporry employees on the Northrop Grummn pyroll re generlly eligible only for svings benefits. Agency Complints: In 2013, Northrop Grummn received 48 new externl gency complints of discrimintion cross the compny. We investigte ll such complints nd tke pproprite ction. Of these complints, 19 were closed nd 29 re still open/pending. Performnce Reviews: As of 2013, 80 percent or more of Northrop Grummn s employees receive performnce nd creer development review every 12 to 15 months. Bsed on scheduling, these reviews my not occur within ech clendr yer for every employee. Humn Rights Trining: Ech yer, our employees collectively receive thousnds of hours of trining covering vriety of topics. Trining on our Stndrds of Business Conduct emphsizes our culture, integrity, ethicl behvior, nd treting ll people firly nd with respect nd dignity. Collective Brgining: Currently pproximtely 5 percent of Northrop Grummn employees re covered by collective brgining greements. There re no Northrop Grummn opertions where employees re t risk of not being ble to exercise freedom of ssocition nd collective brgining. Security: All Northrop Grummn security personnel receive comprehensive trining on our policies nd procedures nd Stndrds of Business Conduct. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. 14

OUR OPERATIONS SUPPLIER RESPONSIBILITY AND DIVERSITY In 2013, we issued pproximtely $8.4 billion worth of subcontrcts nd purchse orders to brod bse of pproximtely 9,500 suppliers. Collborting with suppliers on better environmentl nd socilly responsible performnce is n importnt element of our responsibility efforts. A key strting point is the One Northrop Grummn chrter we instill throughout the compny nd the procurement orgniztion. The gol: to estblish single, consistent opertionl focus promoting best prctices in environmentl control nd sustinbility with the supplier bse nd customers. Our Online Automted Supplier Informtion System (OASIS) supplier portl provides instnt ccess to our supplier terms nd conditions nd other importnt considertions in doing business with Northrop Grummn. Suppliers to our compny re vlued tem members nd ech one is expected to understnd the need for top performnce not only in qulity, schedule, nd cost but in ll res, including diversity, occuptionl helth nd sfety, humn rights nd lbor, nd environmentl responsibility. Northrop Grummn suppliers receive n nnul letter outlining our ethics policies nd code of conduct. Ensuring High Stndrds Our vision is to be the most trusted, worldclss, innovtive supply-chin orgniztion tht delivers vlue to our customers through integrtion of highly skilled people, suppliers, processes, tools, nd communictions. Additionlly, to ensure these gols re not ttined t the expense of ethics nd integrity, our employees with procurement uthority re required to nnully complete dditionl specilized ethics trining nd complete the Disclosure of Conflicts of Interest Certificte of Stndrds of Business Conduct certifying complince nd disclosing possible conflicts of interest. 2013 Highlights In 2013, we wrded $8.4 billion to pproximtely 9,500 suppliers. We used locl smll businesses within the communities surrounding our operting fcilities, whenever possible. More thn 36 percent of Northrop Grummn procurement spending goes to smll businesses nd women or minority-owned businesses. U. S. Government Mentor-Protégé Progrm We mnged 14 Mentor-Protégé greements nd subcontrcted $13.2 million to these protégé orgniztions during 2013. Since the inception of the Mentor- Protégé Progrm, Northrop Grummn representtives hve mentored more thn 120 smll business firms. Northrop Grummn hs won 22 Deprtment of 2013 SNAPSHOT: DEPARTMENT OF DEFENSE MENTOR- PROTÉGÉ PROGRAM This progrm encourges mjor DoD prime contrctors to develop the technicl nd business cpbilities of orgniztions: Employing severely disbled employees Owned by Minorities, Women, Service- Disbled, nd Veterns Locted in historiclly underutilized business zones The Nunn-Perry Awrd is nmed in honor of retired U.S. Sentor Sm Nunn, who sponsored legisltion to enct the Mentor-Protégé Progrm in 1991, nd former Secretry of Defense Willim Perry. Nunn-Perry wrds re the highest honor prime contrctors cn receive for prticiption in the progrm. Northrop Grummn received two Nunn-Perry wrds in 2013. Defense (DoD) Nunn-Perry wrds, the most wrds of ny prime contrctor, nd hs entered into DoD s first Credit Mentor-Protégé Agreement with MVLE, n AbilityOne service provider. Of the seven prestigious Nunn-Perry Awrds for 2013, we received two. One of them cknowledged the Mentor-Protégé reltionship between Northrop Grummn nd MVLE Inc., the first nd only AbilityOne orgniztion to prticipte in the DoD Mentor-Protégé Progrm. The AbilityOne Progrm is dministered by the Committee for Purchse For People Who Are Blind Or Severely Disbled. The AbilityOne Progrm enbles people who re blind or severely disbled job trining nd employment opportunities in mnufcturing nd services for the federl government nd industries. AbilityOne is the single lrgest source of employment for people who re blind or hve other significnt disbilities nd currently provides employment opportunities to nerly 50,000 people ntionwide. 15

OUR OPERATIONS IN FOCUS Northrop Grummn lso received Nunn-Perry wrd for its Mentor-Protégé reltionship with Kimmich Softwre Systems, Inc., which provides engineering services to the intelligence community. Smll Business Innovtion Reserch (SBIR) The SBIR progrm is the only Smll Business Administrtion (SBA) progrm set side to engge smll businesses in federl Reserch nd Development (R&D) with potentil for commerciliztion. The SBIR progrm is three-phse process of trnsitioning new smll-business technology from proof of concept to commerciliztion within the government pltforms. The min objective of this progrm is to stimulte technologicl innovtion, use smll businesses to meet federl R&D needs, foster nd encourge prticiption by minorities nd disdvntged businesses in technologicl innovtion, nd increse privtesector commerciliztion innovtions derived from federl R&D. We continue to move forwrd with our SBIR progrm. Technicl led employees t ech Northrop Grummn sector use the progrm to ugment the compny s technicl nd scientific expertise. The tems consist of technicl point of contct, supply chin mnger, nd smll business liison officer who collectively work to identify, interview, nd provide subcontrcting opportunities to SBIR firms. Ultimtely, the SBIR progrm provides funding to smll business firms to ssist them in bringing gme-chnging technologies to mrket. We currently monitor Smll Business Innovtion Reserch support from ech of our business sectors by trcking n estimted 31 firms involved in Phse I, II, nd III. 2013 mrks the third consecutive yer tht we hosted the Joint Deprtment of Defense Industry Smll Business Innovtion Reserch/Commerciliztion Rediness Progrm technology interchnge workshop. Air Force nd Nvy representtives invited SBIR firms for one-on-one meetings with Northrop Grummn subject mtter experts t n interchnge workshop t Northrop Grummn fcility. As with prior workshops, the Air Force nd Nvy Trnsition Support Progrm provided the dt mining serch tool to identify smll businesses with Phse II SBIR projects with potentil for government pltforms. Indin Incentive Progrm The Indin Incentive Progrm flls under the Deprtment of Defense Office of Smll Business Progrms, which incentivizes prime contrctors by providing opportunities to contrct nd subcontrct with Ntive Americn Indin/ Alskn nd Hwiin tribl orgniztions. The incentive pyment is returned to Northrop Grummn under seprte contrct line item in the contrct. We hve prticipted in the DoD Indin Incentive Progrm since 1998, generting n estimted $5 million in incentive rebtes. We continue to trck $405,539 in incentive rebtes submitted to Deprtment of Defense during fiscl yer 2013. 2013 Mjor Gols GOAL Improve the performnce of the lrgest nd most criticl suppliers to Northrop Grummn. The set of criteri defining most criticl suppliers is dynmic nd reflects the business needs of our vrious sectors. Given this, we estblished flexible, tiered methodology tht results in corporte nd sector ledership enggement with our most criticl suppliers t ll orgniztionl levels. Ech criticl supplier undergoes seminnul performnce evlution. We continue to use the industry-stndrd cost performnce index, the schedule performnce index, nd vrious qulittive mesures to trck progrm performnce. PERFORMANCE For 2013, we evluted the cost, schedule, qulity, nd overll progrm performnce of our top 11 suppliers who supported progrms on more thn 260 subcontrcts with vlue of more thn $7.5 billion. In 2013 strtegic supplier performnce continued the trend, improving by nerly 16 percent yer-over-yer since 2008. For those criticl suppliers with lgging performnce, we initited process to correct problems nd implement joint improvement inititives. 16

OUR OPERATIONS IN FOCUS Risk Mngement Our customers hve expressed wreness nd concern regrding the defense industril supply bse resilience in light of the defense mrket constrints nd the economic environment. The supply chin could be vulnerble in times of budget reductions with potentil impct on smll businesses. Being sensitive to the finncil stresses of smll businesses in the current economic environment, in 2013 we continued to monitor the finncil risk of those most vulnerble to ctstrophic finncil impct nd to consider n rry of mitigtion mesures. To ddress concerns nd potentil vulnerbilities, we re vigilnt in our complince to corporte procedures governing Northrop Grummn supplier risk identifiction, mngement, nd mitigtion. We re monitoring the pproximtely 9,500 firms tht serve s Northrop Grummn suppliers to understnd the helth of our supply bse. As prt of our corporte risk nlysis process, we mintin supplier wtch list ddressing supplier finncil helth risk. We seek to mnge supplier performnce with robust improvement process nd risk mitigtion exchnge with suppliers. Incresingly, pst performnce by supplier is n importnt element in sourcing decisions with dded considertion given to outstnding performing suppliers. We systemticlly monitor criticl supplier risk with prticulr focus on the risks ssocited from single-source, smll, nd foreign businesses tht my be more vulnerble to progrm performnce deficiencies. Our Northrop Grummn Corporte counterfeit mteril prevention policy prescribes preventive mesures, trining, communiction, counterfeit lert mngement, nd procedures for comprehensive mteril ssurnce. Our Enterprise Mteril Authenticity tem, chrtered by our Corporte Qulity Council nd comprising members from qulity, engineering, supply chin, contrcts, nd the lw deprtment, tkes the led on counterfeit prts protection efforts. This level of focus strengthens prctices cross the compny to mitigte risk. Supply Chin Diversity We prticipte with nd sponsor industry, customer, cdemic, nd vrious other orgniztionl ctivities tht support the growth nd development of the smll- business community. To tht end, we seek collbortion with select universities through Smll Business Innovtion Reserch nd Smll Business Technology Trnsfer progrms. To further enhnce opportunities with vrious minority orgniztions, we ctively support, through our prticiption s bord member, Advncing Minorities Interest (MI) in Engineering, which consists of the schools of engineering t 14 ABET*-ccredited Historiclly Blck Colleges nd Universities (HBCU)/MIs. (*ABET is nonprofit nd non-government ccrediting gency for cdemic progrms in pplied science, computing, engineering, nd technology.) We hve provided n estimted $50,000, collectively, to these universities in support of technicl reserch projects. In ddition, we support the nnul Fyetteville Stte HBCUs technicl chllenge convened by dens nd professors from vrious HBCUs. We lso contributed $5,000 to the Minority On-Line Informtion Service (MOLIS), which supports some 268 minority institutions. The service llows institutions to updte nd provide relevnt informtion on university cpbilities for use by personnel t government gencies nd privte-sector compnies. During the 2013 White House conference celebrting Ntionl Historiclly Blck Colleges nd Universities Week in Wshington, D.C., Northrop Grummn ws n event sponsor with employee presenters wrding $10,000 scholrships to two students prticipting in the 105 Voices of History choir performnce t the Andrew Mellon Stge, nd n dditionl $1,000 in scholrships to students competing t the Wshington Ntionl Oper. This choir consists of one student from ech of 105 HBCUs throughout the United Sttes. We support ntionl diversity trde ssocitions by sponsoring trgeted outrech to suppliers of ll sizes through: AbilityOne (nonprofit gencies tht employ the physiclly chllenged) Asin Business Assocition Blck Business Assocition Cpitl Are Gy nd Lesbin Chmber of Commerce Ltin Business Assocition Ntionl Assocition of Women Business Owners Ntionl Center for Americn Indin Enterprise Development United Sttes Hispnic Chmber of Commerce U.S. Deprtment of Veterns Affirs Center for Veterns Enterprise At Northrop Grummn, our procurement employees commitment to ethicl conduct is demonstrted by : Annully reviewing the procurement integrity policy nd signing certifiction specifying tht they will not ccept supplier gifts, bribes, or kickbcks. Identifying ny conflicts of interest with current nd potentil suppliers. Performing due diligence ssessing whether suppliers or potentil suppliers hve been debrred or suspended. 17

Northrop Grummn employees prticipte on the bords of dvisors of severl universities. OUR OPERATIONS The Northrop Grummn Socio-Economic Business Progrms office cts s the liison with smll nd disdvntged business owners interested in working with Northrop Grummn. We hve received ntionl recognition for our efforts to increse the number of successful minority nd women-owned subcontrctors by providing outrech nd mentorship. Integrted Vlue Network Strtegy We further defined the integrted supply chin strtegy, during 2013, s n integrted vlue network. Compnywide vlue networks provide competitive dvntge by fostering sustined, robust competition for commodity items nd other mterils nd services. Trusted supplier reltionships develop technology hybridiztion, innovtion, nd customiztion to meet customer needs. Although not specificlly identified s such, the journey to this model begn s erly s 2004 nd continues with the strtegic vision of Northrop Grummn Vlue Network fully developed by 2017. GRI EC6, HR1-2, HR6, HR7, HR9 Locl sourcing nd humn rights including child/forced lbor nd indigenous rights Northrop Grummn stndrd terms nd conditions require complince with the Fir Lbor Stndrds Act of 1938 (29 U.S. Code 201-219), s mended, nd re consistent with the regultions nd orders of the United Sttes Deprtment of Lbor under Section 14. We estblished n orgnized pproch to ddressing the complince requirements of Section 1502 of the Dodd-Frnk Act, Conflict Minerls. We re on trck to meet the due diligence nd reporting requirements of the ct. We re committed to the responsible sourcing of minerls through our globl supply chin. We re committed to complying with the Dodd-Frnk disclosure requirements. Northrop Grummn hs n integrted globl supply chin. Ech progrm nd procurement uses its best effort to source from customer countries nd regions. Ech of our pproximtely 9,500 suppliers is sent n nnul letter stting, Strict dherence to ethicl prctices is Northrop Grummn priority nd is n essentil element of ll of our supplier reltionships. The letter links the supplier to the Northrop Grummn ssocite vlues ethics nd conduct brochure, which outlines our vlues nd compny stndrds for ethicl behvior for employees nd suppliers like. Our compny stndrds pply to nyone who represents Northrop Grummn. Violting rules relting to our reltionships with the U.S. government or to our commercil customers my result in serious consequences up to nd including termintion of one s reltionship with the compny. Further, we will not knowingly do business with suppliers tht engge in humn rights violtions or use child or forced lbor. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. 18

OUR OPERATIONS IN FOCUS ENVIRONMENTAL, HEALTH, AND SAFETY We re committed to protecting our environment s well s our employees, customers, nd people in the communities in which we operte. Our objectives re simple: to provide sfe nd productive work environment, ensure environmentl complince, nd integrte environmentl sustinbility into the wy we do business. Policy It is our policy to conduct our opertions in mnner tht protects the helth nd sfety of our employees, contrctors, visitors, nd the community in mnner tht is environmentlly responsible nd in ccordnce with ll pplicble lws nd regultions. To fulfill this policy, we strive to: Provide sfe nd productive work environment while minimizing environmentl impct. Develop nd implement mngement systems to mitigte potentil environmentl, nd helth nd sfety (EHS) risks. Integrte EHS nd environmentl sustinbility requirements into plnning, design, procurement, mnufcturing, nd internl mngement ctivities throughout the compny. Mke continuous improvement in wht we do, nd how we do it, top priority. Drive performnce through continul improvement. Ledership To guide nd oversee the compny s EHS progrms, we rely on the EHS Ledership Council, which comprises senior leders from the corporte office nd ech operting sector. The EHS Ledership Council develops EHS nd environmentl sustinbility strtegies, gols, nd plns; promotes efficiencies through best prctice shring; monitors nd reports on EHS nd environmentl sustinbility performnce; dvnces mngement ownership of these efforts t ll levels; engges employees in EHS nd environmentl sustinbility progrms; nd develops nd implements progrms tht support complince nd continul improvement. We believe so strongly in these res of performnce tht two sfety nd three environmentl sustinbility metrics re included in our compny s performnce scorecrd: Sfety: Totl cse rte (TCR) Lost work dy rte (LWDR) Environmentl: Greenhouse gs (GHG) emissions reduction/voidnce Solid wste reduction best mngement prctices implementtion Wter conservtion best mngement prctices implementtion These non-finncil metrics impct overll corporte performnce metrics, which receive visibility t the highest levels within the compny. 2013 Highlights Achieved our greenhouse gs reduction gol two yers hed of pln by reducing GHG emissions 25.3 percent, normlized to sles, from our 2008 bse yer through yer-end 2012. This reduction performnce equls 26.9 percent bsolute reduction in GHG emissions. Nmed to the Crbon Disclosure Ledership Index nd Crbon Performnce Ledership Index by CDP (formerly the Crbon Disclosure Project) for ledership in climte chnge mngement, strtegy, trnsprency, nd performnce. Our disclosure score of 99 out of 100 nd A performnce (the highest ttinble) erned us distinction s leder in the S&P 500 industrils ctegory, with top performnce mong globl erospce nd defense industry compnies. Received Resonble Assurnce for our 2012 nd 2013 Scope 1 nd Scope 2 greenhouse gs inventories, providing four consecutive yers of third-prty verified GHG dt by Lloyd s Register Qulity Assurnce (LRQA). Resonble ssurnce is the highest level of ssurnce in ccordnce with the ISO 14064-3 Greenhouse Gs Accounting nd Verifiction stndrd. Received Limited Assurnce for our 2012 nd 2013 Business Trvel greenhouse gs inventory, vi third-prty verifiction conducted by LRQA. We re first in our industry to conduct third-prty verifiction for ctegory of Scope 3 Business Trvel emissions. Limited ssurnce reflects ssurnce in ccordnce with the ISO 14064-3 Greenhouse Gs Accounting nd Verifiction stndrd. Received the 2012 Chief of Nvl Opertions (CNO) Environmentl Awrd (recognized in Mrch 2013) for the Northrop Grummn-NAVAIR progrm s sustinbility efforts, including hzrdous mterils substitutions, energy efficiency inititives, mteril wste reductions, nd mnufcturing fcility energy consumption. This ws the second CNO Environmentl Awrd for the progrm tem. 19

OUR OPERATIONS EHS Opertions: Complince nd Mngement We hve diverse opertions with rnge of mterils nd equipment. Our wide network of EHS professionls provides guidnce nd support to ensure the sfety nd helth of our employees nd cre for the environment. Through written progrm guidnce nd procedures, trining, periodic selfinspections, udits, nd regultory updtes, our EHS professionls support nd guide business progrms nd processes nd EHS complince cross the compny, with responsibilities tht include monitoring nd implementing regultory requirements nd identifying nd completing corrective ctions. To fcilitte efficient nd effective mngement of pplicble complince requirements, we lso implement EHS mngement systems. We conduct periodic udits of our opertions to confirm we re performing t or bove the required EHS stndrds. In ddition, mny of our sites hve sfety observers who prticipte in site sfety committees nd ct s the eyes nd ers for EHS complince nd sfe working conditions throughout their fcilities. 2009-2013 Environmentl, Helth, nd Sfety Audit Results number of udits 60 50 40 30 20 10 0 35 GREEN: stisfctory progrm 46 2 Ech udited site receives color rting bsed on the effectiveness of the mngement system, nd complince with pplicble requirements. 46 2009 2010 2011 2012 2013 YELLOW: mrginl progrm 50 1 35 1 RED: unstisfctory progrm The EHS Audit Process Our EHS professionls conduct udits on regulr bsis nd promptly nd systemticlly ddress deficiencies identified. We use the udits to shre innovtive nd proven best prctices cross the compny. Ech udited site receives score (100 is the best) bsed on the effectiveness of the mngement system. Additionlly, we mke n ssessment of the degree to which ll EHS progrm elements re being implemented t the site level. The overll ssessment rting of ech site, with corresponding color rting, is bsed on the following scle: GOAL GREEN: stisfctory progrm YELLOW: mrginl progrm RED: unstisfctory progrm To chieve minimum of 90 (out of 100) verge score for completeness nd implementtion of mngement systems t udited sites. The purpose of the udit process is to ssess complince ginst EHS requirements nd our mngement systems criteri. We udit pproximtely onethird of our qulifying sites ech yer, process tht drives continul improvement through the prompt nd systemtic review nd correction of deficiencies nd opportunities for improvement s well s shring of successful best prctices. For dded ssurnce, we hve process to review our udit progrm nd policies. In 2013, we updted our EHS udit protocol fter creful review of pst performnce nd identifiction of opportunities for improvement. At the conclusion of ech udit, we implement nd trck corrective ction pln bsed on udit findings nd recommendtions. Sites receiving n overll rting of yellow or red re re-udited the following yer to ensure progrm deficiencies hve been corrected. We communicte udit results nd corrective ctions from the site mngement group to compny executive mngement. In ddition, our corporte internl udit progrm provides n objective evlution of our performnce. PERFORMANCE As prt of the udit process, we evlute nd score ech site on mngement systems mturity, with 100 percent being the highest chievble score. In 2013, our overll score ws 92.3 percent. 20

2013 AWARDS Preferred Business Awrd: Recognition of the outstnding contribution to the recycling, recovery, nd reuse of mterils (Chrlottesville, Virgini). Energy Preservtion Awrd: Environmentl ledership in energy mngement (Irwindle, Cliforni Chmber of Commerce). Pollution Prevention Awrd: Pollution prevention ctivities, including our inline clener equipment upgrde tht resulted in 50 percent svings in wstewter nd chemicl usge, nd 45 percent reductions in energy usge (Uth Deprtment of Environmentl Qulity Pollution Prevention Assocition). Air Pollution Control Achievement Awrd: Air Qulity Eduction: For wreness bulletins to educte employees bout opportunities to sve energy t home nd work, nd reduce gsoline consumption nd utomotive evportive nd exhust emissions (City of Huntsville, Albm Air Pollution Control Bord). 2012 Leder in Sustinbility Awrd (wrded Mrch 2014): For commitment to recycling btteries nd cellphones (Cll2Recycle North Americ). The Regultory Review Process Like mny businesses, ours is subject to review nd udit by regultory gencies nd other uthorities including federl, stte, nd locl EHS gencies, nd building inspectors nd fire mrshls. These reviews by externl orgniztions provide n importnt perspective of opertionl complince nd effectiveness of our progrms nd procedures. In 2013, EHS regultory gency representtives visited or contcted Northrop Grummn sites 168 times, with 12 EHS relted enforcement ctions. None of these enforcement ctions resulted in significnt fines. ISO 14001 Environmentl Mngement Systems We encourge conformnce to the Interntionl Orgniztion for Stndrdiztion (ISO) 14001 registrtion for Environmentl Mngement Systems. Attining nd mintining this designtion is representtive of our commitment to environmentl mngement nd continul improvement. In 2013, our Prk Air opertions in Peterborough, U.K., received its ISO 14001 certifiction, nd 10 dditionl fcilities successfully renewed their ISO 14001 certifictions. The ISO 14001 certifiction is chieved through third-prty verifiction tht effective environmentl mngement systems hve been implemented nd corrective ction nd improvement mesures re evident t ech site. Occuptionl Helth nd Sfety Protecting employee helth nd sfety is prmount to our mission nd performnce. We continue to emphsize nd invest in progrms nd enhncements to reduce the number nd severity of injuries nd illnesses. We tke ccident prevention seriously. Since 2010, sfety performnce hs been incorported into corporte performnce metrics. Number of ISO 14001-Certified Sites 2000 2 2005 9 2010 22 GRI GOAL To ensure sfe nd helthy workplce for our employees nd visitors through injury nd illness prevention. We lso strive to provide employees with the tools nd resources to tke ownership of their sfety in their dy-to-dy ctivities. 2001 2 2006 11 2011 22 2002 4 2007 13 2012 23 2003 5 2008 20 2013 23 2004 8 2009 20 The number of ISO 14001-certified sites remined the sme from 2012 to 2013, due to the ddition of our Peterborough, U.K. site nd closure of seprte U.K. site. We monitor nd report the following indictors to evlute the effectiveness of our occuptionl helth nd sfety progrm: TOTAL CASE RATE (TCR): The totl number of OSHA (Occuptionl Sfety nd Helth Administrtion)-recordble occuptionl injuries nd illnesses: i.e., cses requiring medicl tretment beyond first id, per 100 full-time workers. 21

OUR OPERATIONS LOST WORK DAY RATE (LWDR): The totl number of lost work dys per 100 full-time workers. LA7: Totl Cse Rte, Lost Work Dy Rte, Dys Awy Cse Rte GRI DAYS AWAY CASE RATE (DACR): The totl number of cses, per 100 full-time workers, tht resulted in lost or restricted dys or job trnsfer due to work-relted illnesses or injures. Used in conjunction with TCR nd LWDR, DACR ids in identifying the severity of workplce injuries nd illnesses. Addressing n Opportunity for Improvement In 2013, we lunched extensive slips, trips, nd flls wreness cmpigns cross the compny in response to the need for improved injury prevention. The emphsis on injury prevention supports our overll efforts to keep employees helthy nd t work, which helps us reduce our incident rte. Employee wreness inititives lerted employees to common cuses of slips, trips, nd flls, including wlking while texting, wether-relted slip hzrds, nd trip hzrds in the workplce. In support of employee helth nd wellness, we implemented the following fitness inititives cross the compny: Step into 2013 Progrm: Burn Clories Not Electricity is n eightweek fitness progrm encourging employees to tke the stirs. More thn 280 employees prticipted in the progrm, choosing stirs over elevtors. RESULTS: Employees climbed more thn 100,000 flights of stirs, burning more thn 5 million clories while sving n estimted 519 kwh of electricity, equivlent to pproximtely 0.5 metric tons of crbon dioxide equivlent (MTCO2e) emissions. Better Brekfst Club: In response to the 2012 Live Well employee survey, body weight ws identified s top risk fctor for employees, nd top-rnked behvior they were redy to chnge. The progrm provided weekly eductionl newsletters with nutritionl tips for employees to build helthy hbit of eting brekfst dily, emphsizing protein, whole grins, fruits, nd diry. RESULTS: After the eight-week progrm, 27 percent of progrm prticipnts hd reduced body mss index, 30 percent hd lowered blood pressure, 88 percent reported high energy, nd 90 percent were eting brekfst every dy. LA8: SAFETY STEWARDSHIP OSHA Voluntry Protection Progrm We prticipte in the OSHA Voluntry Protection Progrm (VPP), n effort bsed on coopertive reltionships mong mngement, employees, nd OSHA. Under the progrm, prticipnts provide mentoring to other compnies striving to chieve VPP sttus. Eight of our North Americn fcilities re enrolled s ctive VPP-ccredited progrms. OHSAS 18001 Occuptionl Helth nd Sfety Assessment Series (OHSAS) 18001 is n interntionl helth nd sfety mngement system tht helps orgniztions mnge occuptionl risks nd improve helth nd sfety performnce. In 2013, our three certified sites chieved recertifiction s OHSAS 18001-ccredited progrms. Globl Hrmoniztion Stndrd In response to the 2012 publiction of OSHA s Globlly Hrmonized stndrd, we provided trining to our employees on the new sfety dt sheets nd GHS lbels. We published the new system in news postings, locl newsletters, nd digitl signge. We re working with suppliers nd vendors to ensure smooth trnsition from mteril sfety dt sheets to sfety dt sheets in conformnce with the new stndrd. 2012 2013 Chnge Totl Cse Rte (TCR) 0.97 0.99 2.1% Lost Work Dy Rte (LWDR) 14.61 14.05-3.8% Dys Awy Cse Rte (DACR) 0.30 0.28-9.7% This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s this to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. GRI This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. 22

GRI LA6, LA8: SAFETY HIGHLIGHTS Preventive Sfety Prctices Relize Results Professionls from disciplines including EHS, medicl, nd humn resources formed focused mngement tem to ddress lost work dys t sites cross the compny. Professionls from sites in Bltimore, Mrylnd, to Apopk, Florid, nd Rolling Medows, Illinois, to Sunnyvle, Woodlnd Hills, nd Azus, Cliforni, prticipted on cross-functionl mngement tem to reduce 1,489 lost work dy rtes from 2012. In November, our Lke Chrles, Louisin, fcility employees chieved more thn 1 million lbor hours worked without n incident. According to OSHA, the erospce industry verges eight dy-wy injuries per million hours worked. Beginning in 2011, Lke Chrles site employees developed strtegy to improve the sfety culture. The inititives tht contributed to the site s sfety culture improvement included: Regulr sfety-focused events, topiclly rotted to ddress the vried opertions t the fcility. This systemtic pproch nd problemsolving tool helped quickly implement low-cost improvements. Bi-weekly mnger sfety meetings to discuss nd ddress opportunities for improvement. Weekly incident nlysis to identify time-lpse trends for incidents, nd implementtion of preventive sfety wreness ctions. Mnger-to-mnger nd peer-to-peer best prctice shring. Dily sfety inspections, conducted by mnger nd n employee, rotting through the stff to ensure full involvement. Return to work collbortion mong EHS, supervisors, nd our industril medicl providers to keep employees productive nd t work. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. The Environment Remedition GOAL Our gol is to effectively ddress environmentlly impcted property in complince with pplicble regultory requirements, nd ultimtely return these properties to productive use. We pursue this outcome by seeking to work coopertively with governmentl gencies, conservtion groups, citizen groups, nd other stkeholders to ddress the environmentl impcts t our remedition sites in mnner tht protects humn helth nd the environment, is cost-effective, nd lessens further environmentl impct. PERFORMANCE In 2013, we were involved in more thn 175 environmentl remedition projects with n pproximte nnul remedition budget of $40 million. From 2004 to 2013, we successfully completed ctive remedition t 87 sites nd removed them from the compny s portfolio of impcted properties by chieving regultion-bsed remedition objectives. During the sme time period, we lso ccomplished life-cycle cost reductions totling $57 million through vrious ctivities, including innovtive engineering pproches to investigtion methodologies nd improvements in the ppliction of remedil technologies. Opportunities for Improvement The process of site remedition culmintes in the restortion nd return of impcted property to productive use. From erly investigtive phses, through the ppliction of technicl remedies, to the finl phse involving long-term site monitoring, remedition consumes nd impcts nturl resources, creting its own environmentl footprint. The verge remedition site cn tke decdes to restore, which results in finncil nd environmentl costs. We recognize tht ech phse of the remedition process presents opportunities for improvement, nd chllenges persist due to the unique nd dynmic nture of ech site. Innovtive solutions nd technologies re providing techniques tht promise restortion nd minimiztion of environmentl impcts. We routinely monitor nd test vilble technologies tht my be pplicble to specific field conditions to evlute their effectiveness in ccelerting site recovery time. 23

Pollution Prevention GOAL Comply with pplicble regultions nd reduce front-end sources of pollution. Exmples of our pollution prevention progrms include source reduction, buys-needed strtegies, mteril substitution, nd procurement of environmentlly preferble products nd services. PERFORMANCE GRI In 2012 (the most recent dt vilble), we diverted 19 million pounds of our EN14: ENVIRONMENTAL SNAPSHOT Exploring innovtive nd cost-effective remedition techniques In 2013, we continued to seek cost-effective lterntives to trditionl resource-intensive remedition prctices. Our experience our totl solid wste strem, from lndfills to recycling fcilities. This represents 5 percent improvement in our diversion rte over our 2011 performnce figures. We employ recycling nd reuse progrms cross the compny for products including pper, crdbord, scrp metl, wood, construction mterils, computers nd relted equipment, btteries, tires, fluorescent light tubes, mercury thermometers, nd cbles. hs demonstrted tht by replcing trditionl, impct-intensive Opportunities for Improvement remedition prctices (excvtion nd lnd disposl) with in-plce We hve mde chnges throughout the compny to reduce our wste strems enzyme nd/or bcteril tretment, we cn reduce environmentl nd the potentil hzrds of the mterils used in our products. We continue disturbnce nd energy use, nd promote ecosystem recovery. to evlute opportunities to improve our processes nd environmentl Our efforts to minimize environmentl impcts nd optimize remedition results include the use of n orgnocly brrier to prohibit the flow of oil from sturted soils into nerby wterwys, eliminting the need for full-scle excvtion of the river bnk nd minimizing disturbnce to criticl riprin ecosystems. In ddition, we continued the use of the following less-invsive techniques: Electrodes or stem to het soil nd groundwter in plce of mechnicl methods such s excvtion. Innovtive soil vpor extrction technology to prevent vpor migrtion into buildings. A permeble underground brrier to destroy contminnts s they trvel from the site, eliminting the need for energyintensive recovery wells nd wter-tretment systems. Use of nturlly occurring mterils, including emulsified vegetble oil, chitin, nd cheese whey, to promote degrdtion of contminnts through bioremedition. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. 24 totl of 34 million pounds of solid wste, which is pproximtely 57 percent of performnce in wys tht blnce short- nd long-term business interests, regultory requirements, nd resource vilbility.

OUR OPERATIONS IN FOCUS Environmentl Sustinbility greeng With the inception of our environmentl sustinbility progrm greeng, in 2009, we committed to better understnd nd define wht sustinbility mens to us, our customers, our shreholders nd our employees. Environmentl sustinbility is n objective tht is both supportive of, nd supported by, our core vlues: qulity, customer stisfction, ledership, integrity, people, nd suppliers. Shring the principles of Six Sigm mnufcturing, integrtion of environmentl sustinbility principles supports efficiency throughout the orgniztion nd drives performnce. GOAL The greeng progrm estblishes specific gols for reducing greenhouse gses (GHGs), solid wste genertion, nd wter use. By yer-end 2014, we re committed to: Reduce our combined Scope 1 nd 2 GHG intensity (metric tonnes of crbon dioxide equivlent [MTCO2e], normlized to sles) by 25 percent reltive to the 2008 bse yer. Implement t lest 75 percent of our solid wste reduction nd wter conservtion best mngement prctices t ll lrge owned nd lesed buildings (100,000 squre feet nd lrger). Our Strtegy To successfully integrte environmentl sustinbility into our orgniztionl culture, we developed our strtegy to drive performnce from the inside out. We hve estblished environmentl sustinbility metrics (performnce to gol) s mesure of reducing GHGs nd implementing solid wste nd wter conservtion best mngement prctices. These environmentl sustinbility metrics re tied to executive compenstion metrics, demonstrting strong support from our Bord of Directors nd reinforcing the vlue of ledership nd enggement throughout the orgniztion. This commitment is criticl element of our success. With the support of our executive ledership, our greeng progrm drives performnce through blnced strtegic pln tht prioritizes identifying opportunities for efficiency nd improvement in our own opertions. In ddition to energy nd resource conservtion, we evlute nd implement opportunities driven by technologicl dvncements nd renewble nd lterntive energy mngement. We re firm in our commitment to mintin blnced, vlue-driven strtegy for performnce. Energy Efficiency Energy use reduction is fundmentl method through which we chieve GHG emissions reductions. Our results re driven by reducing fuel use (e.g., gsoline, diesel, nturl gs) in our opertions through inititives led by our fcilities, rel estte nd informtion technology orgniztions, nd our engineering nd mnufcturing opertions. Resource Reduction We constntly evlute opportunities to improve efficiency nd reduce emissions ssocited with the use of process gses nd other inputs. Replcing process gses nd trditionl refrigernts with newer, lower globl wrming potentil gses supports process continuity nd reduced GHG emissions. Green Power We support the dvncement of renewble electricity infrstructure, through use of renewble energy t our sites s well s through procurement of renewble energy certifictes (RECs) generted from renewble energy systems integrted into the ntionl infrstructure. We continue to evlute options for green power sources t our owned sites nd mintin our multi-yer purchsing commitment Alterntive nd Renewble Energy In support of innovtive, energy-efficient technology, we constntly evlute opportunities to implement lterntive nd renewble energy systems to improve energy efficiency t our fcilities. Our support rnges from solr power rrys to high-efficiency cogenertion systems to emerging technologies tht use orgnic mterils to hrness energy. Production-relted Hzrdous Wste nd Reported EPA Toxics Relese Inventory (TRI) Hzrdous Wste (Tons) Hzrdous Wste Tons/100FTE TRI (Tons) TRI Tons/100FTE 2005 1,602.2 2.2 100.6 0.14 2006 1,982.6 2.7 77.1 0.10 2007 1,608.7 1.9 41.1 0.05 2008 1,469.9 1.8 61.1 0.08 2009 1,459.7 1.8 65.8 0.08 2010 1,198.3 1.5 63.2 0.08 2011 1,040.6 1.4 55.0 0.08 2012 1,114.5 1.7 38.0 0.06 We continue to reduce the toxic nd hzrdous mterils used in our mnufcturing opertions, for the benefit of our employees nd the environment. As the figures illustrte, we re reducing our hzrdous wste disposl mounts nd TRI dischrges. We understnd tht pollution prevention is n ongoing opportunity for improvement, s our products nd services diversify nd the types nd intensity of product nd service lines fluctute in ccordnce with demnd nd other externl fctors. 25

OUR OPERATIONS Solid Wste nd Wter We re on trck to chieve our compny-wide best mngement prctices (BMPs) implementtion gol of 75 percent by yer-end 2014. In 2013, we chieved 72.4 percent implementtion of wter conservtion BMPs nd 85.9 percent implementtion of solid wste reduction BMPs. As we pln to complete our solid wste nd wter use BMPs in 2014, we re evluting opportunities to build upon the contributions from our BMPs. Recognizing tht wter nd wste mngement re criticl resource chllenges, we re committed to further reducing our impcts. We continue to work on green lese requirements for our lesed spces through collbortive efforts with our lndlords. The green lesing lnguge requires lndlords to provide monthly utility dt to support our comprehensive energy mngement system, implement energy-efficiency projects nd pplicble solid wste nd wter conservtion BMPs, nd use environmentlly preferble clening products in jnitoril service contrcts. EN3,4,5: GREENHOUSE GAS REDUCTION PERFORMANCE We chieved our inugurl GHG reduction gol of 25 percent two yers hed of pln, chieving 25.3 percent intensity reduction s of yer-end 2012. This reduction resulted in 26.9 percent reduction in bsolute emissions. In 2013, we continued implementtion of comprehensive energy mngement system to ddress our historic one-yer lg in the disclosure of our GHG inventory nd performnce in this report. Automtion of our utility bill processing nd GHG dt mngement provided through this system now llows us to report current-yer GHG dt. GRI EN16, EN17, EN19 Greenhouse Gs Emissions Reduction Performnce GRI 2008 Bse Yer 2009 2010 2011 2012 2013 Performnce from Bse Yer Crbon Intensity (MTCO2e/$M Sles) 33.3 29.4 27.1 26.8 24.9 24.3-27.2% Int % Reduction -11.8% -18.8% -19.6% -25.3% -27.2% Absolute GHG Emissions (Million MTCO2e) 858,595 794,729 745,634 706,890 627,886 598,047-30.3% Abs % Reduction -7.4% -13.2% -17.7% -26.9% -30.3% Dt is inclusive of mergers, cquisitions, nd divestitures. Our inventory is developed in ccordnce with the GHG Protocol Corporte Stndrd. We disclose our most up-to-dte nnul environmentl performnce vi CDP; our 2013 Climte Chnge Response is publicly vilble vi the CDP website. In 2013, we implemented GHG-emissions reduction projects tht reduced n estimted 35,523 MTCO2e. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. BASE YEAR 0% -5% -10% -15% -20% -25% -30% -35% Percent (%) Reduction 2008 2009 2010 2011 2012 2013 Achieved Gol Sustined Performnce INTENSITY GOAL GHG Intensity Absolute GHG Footprint 26

Professionl Associtions To remin current with industry trends nd inititives, nd engge with peers on common EHS chllenges, we prticipte in relevnt professionl ssocitions. Our roles rnge from membership to ledership, where we fully engge in discussions, work groups, nd committees tht support our customer, business, nd progrm needs. In 2013, we prticipted s members of the following professionl ssocitions: As shown, we estblished corporte-level progrm to coordinte instlltion of EV sttions t cmpuses cross the compny. In 2013, we dded 12 EV chrging sttions t loctions including Rncho Bernrdo, Cliforni. The Auditing Roundtble ORC Helth, Sfety nd Environment Strtegies, Inc. Voluntry Protection Progrm Prticipnts Assocition Ntionl Sfety Council Americn Society of Sfety Engineers Corporte Environmentl Enforcement Council Aerospce Industries Assocition Interntionl Aerospce Environmentl Group Corporte EcoForum Conservtion Interntionl s Business nd Sustinbility Council EN12-14: ECOSYSTEM CONSERVATION GRI We support protection, conservtion, nd restortion of criticl ecosystems through numerous volunteer clenup efforts ntionwide nd finncil support of ecosystem conservtion-bsed crbon offset projects. In 2013, we purchsed certified crbon offsets generted in ssocition with the Mississippi Vlley Reforesttion Project in the southestern United Sttes. The project objective is to reforest 1 million cres of the Lower Mississippi Alluvil Vlley, regrded s one of the most importnt ecosystems in North Americ; it is n ecosystem our locl employees rely on in their dily lives for clen drinking wter nd clen ir. In ccordnce with our internl protocol, we committed to multi-yer purchses of crbon offset credits. We mke this commitment to blnce investment considertions cross ll GHG-reduction strtegies. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. 27

GREEN IT In 2013, we completed our keystone green IT inititive: the Enterprise Dt Center Migrtion progrm. Between 2010 nd 2013, we migrted 19 mjor dt centers nd more thn 60 smll dt centers nd server rooms cross the U.S. to three enterprise dt centers. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. EN8-10: WATER USE Wter use t Northrop Grummn is neither significnt component of our mnufcturing opertions nor key element in our product lines. However, we hve dopted wter stewrdship prctices through our Wter Conservtion Best Mngement Prctices to upgrde nd improve our infrstructure to chieve immedite reductions in our wter use. We re evluting dditionl opportunities to ddress wter use in future yers. GRI EN7, EN18: 2013 GHG REDUCTION INITIATIVES Fcilities Mngement We re reducing the resource intensity of our physicl footprint by emphsizing efficiencies nd systems enhncements throughout our fcilities. We re further optimizing our rel estte portfolio to eliminte excess fcilities nd reduce our overll footprint. GRI This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. In 2013, we hd opertions in six buildings tht re LEED (Ledership in Energy nd Environmentl Design) certified nd six buildings tht meet the Environmentl Protection Agency s ENERGY STAR building stndrds. While we decresed our LEED certified building count by one becuse we vcted one fcility, we improved our overll portfolio through the ddition of two ENERGY STAR buildings. As our rel estte portfolio chnges, we continue to explore new opportunities to reduce our environmentl footprint nd meet these, or similr, energy-efficiency stndrds by evluting building envelopes nd performnce. Our Corporte Office in Flls Church, Virgini, received LEED Certifiction (Pltinum Commercil Interiors) for the third floor build-out construction. This certifiction is distinct from the LEED Gold certifiction (Commercil Interiors) for the corporte office itself, chieved in 2011 upon completion of the building renovtion. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s these to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. 28

OUR OPERATIONS IN FOCUS greeng 2.0: Leverging Innovtion nd Environmentl Sustinbility Hving chieved our inugurl GHG reduction gol two yers hed of pln, we initited the plnning process for our greeng 2.0 GHG reduction gol in 2013. Our gol-setting strtegy represents blnce of expecttions to perform, our known bility to perform, nd innovtion. This strtegy informed our second GHG-reduction gol: By 2020, we re committed to reducing bsolute GHG emissions 30 percent reltive to 2010 GHG emissions levels. We trnsitioned to n bsolute GHG emissions-reduction gol to ensure our efforts directly support climte chnge mitigtion. Mesuring GHG emission reductions in bsolute terms lso supports the gols of our customers, the U.S. federl government nd scientific findings from expert orgniztions such s the Interntionl Pnel on Climte Chnge. We estblished 2010 to 2020 s our period of performnce for two primry resons: The 2010 bse yer ligns with our first yer of GHG inventory dt for which we received Resonble Assurnce through third-prty verifiction. The 2020 gol yer is consistent with our customers GHG reduction gol timelines nd provides n opportunity to ddress long-rnge opportunities. Our decision to seek to reduce emissions by 30 percent over this period of performnce is driven by combintion of externl stkeholder expecttions, innovtion opportunities, nd internl opportunity ssessments. Building on the successes of our first GHGreduction gol, our strtegic emphses for this next gol period will prioritize energy use reduction, recpture nd substitution of high GHG-emitting gses, nd process optimiztion to drive further energy reductions. This is chllenging environmentl performnce gol nd builds on our 15.8 percent bsolute reduction performnce from 2010-2012. We re committed to leverge our culture of innovtion to chieve success for the GHG-reduction trget s well s the next genertion of solid wste nd wter conservtion gols. SNAPSHOT Supporting Scientists nd Policymkers We use our expertise to dvnce environmentl nd energy security, which lso supports climte chnge-dpttion plnning. We re dedicted to providing scientists nd decision mkers worldwide with dt nd knowledge they need to understnd climte trends nd impcts so they cn inform policymkers on how to mitigte risk nd develop dpttion nd resiliency plns. In 2013, the Northrop Grummn-built Globl Hwk, n unmnned ircrft system tht offers unique combintion of high-ltitude nd long-endurnce performnce cpbilities, conducted the following missions in support of environmentl dt collection nd humnitrin ssistnce: ATTREX: The mission of the Ntionl Aeronutics nd Spce Administrtion (NASA) Airborne Tropicl Tropopuse Experiment (ATTREX) is to study how the composition of the tmosphere ffects Erth s climte by studying the region of the upper tmosphere where pollutnts nd other gses enter the strtosphere nd potentilly influence climte. Studies hve shown tht even smll chnges in strtospheric humidity my cuse climte impct tht is more significnt thn the impct of greenhouse gses. TYPHOON HAIYAN ENVIRONMENTAL AND SECURITY SUPPORT: In November 2013, following Typhoon Hiyn in the South Pcific, Globl Hwk ircrft collected pproximtely 1,000 imges of the typhoon-rvged Philippines, including 282 wide-re imges to id the U.S. nd Philippine uthorities with relief logistics, including ssessments of rods, irports, nd fields so relief tems could rech displced survivors. POLAR HAWK: Equipped with n uninhbited eril vehicle synthetic perture rdr nd high-resolution cmer to conduct ground mpping nd visul observtion of Arctic ice cps during 21-hour flight, Globl Hwk ircrft (dubbed Polr Hwk for the mission) enbles Americn nd Cndin scientists to study chnges in topogrphy nd Arctic ice cps to better understnd the chnges ffecting the region becuse of climte chnge. Stkeholder Enggement Underpinning our greeng strtegy is stkeholder enggement, which spns externl nd internl udiences such s customers, 29

OUR OPERATIONS IN FOCUS shreholders, prtner orgniztions, nd employees. With the diverse interests of ech udience, we re fced with the chllenge nd opportunity to engge to ensure ll our stkeholders receive the support nd informtion they need. Integrl to our stkeholder enggement strtegy is our commitment to provide ccurte informtion regrding our environmentl sustinbility progrm gols nd performnce. Our key stkeholders re: Customers Shreholders Industry Employees In 2013, we stffed Technicl Engineering Support for the Air Force Civil Engineer Center Energy Directorte to provide direct support of centrlized energy progrm mngement. Applying subject mtter expertise, our Northrop Grummn employees conducted engineering, finncil, technicl, nd other professionl nlyses to support Air Force energy progrm mngement ctivities worldwide, including renewble nd lterntive energy systems. These inititives support the long-term energy efficiency objectives for Air Force fcilities nd opertions. Our Crbon Footprint: Employee Enggement Erth Hour: We continued our commitment to rise wreness of globl climte chnge by prticipting in the globl Erth Hour. Our fcilities deprtments turned off unnecessry building nd signge lighting, nd employees were encourged to prticipte t home. Bike to Work: Employees t mny of our sites supported the nnul Bike to Work Dy, hosting welcoming sttions for employees s they rode into work nd providing them with helthy sncks nd wter to celebrte their contribution to cr-free commute. INTERNATIONAL AEROSPACE ENVIRONMENTAL GROUP (IAEG) As founding member of the IAEG, we re committed to working with our globl erospce peers to ddress common chllenges by developing voluntry consensus stndrds. We prticipte in IAEG s bord members, supporting the orgniztion s governnce, nd s subject mtter experts in the Chemicl Reporting nd GHG Accounting nd Reporting work groups. The Chemicl Reporting work group is developing globl declrble-substnce list for the erospce industry. The list will enble the supply chin to shre informtion bout the chemicls nd mterils used to mnufcture prts for erospce products, which supports regultory complince for suppliers nd erospce compnies. The GHG Accounting nd Reporting work group finlized the GHG Reporting Guidnce for the Aerospce Industry, supplement to the GHG Protocol Corporte Accounting nd Reporting Stndrd. The objective of the Reporting Guidnce is to hrmonize voluntry reporting of corporte GHG emissions, supporting compnies efforts to ccount for vlue chin emissions. In coordintion with the World Resources Institute (WRI), the Drft Reporting Guidnce ws relesed for public comment in December 2013. 30 CDP (formerly the Crbon Disclosure Project) In 2013, we erned disclosure score of 99 out of 100 nd performnce level A (the highest level), erning distinction in the Crbon Disclosure Ledership Index (CDLI) nd the Crbon Performnce Ledership Index (CPLI). We were in the top 1 percent of the S&P 500 Industril sector nd first in the erospce nd defense industry. The CDLI includes compnies tht demonstrte strong ctions to reduce GHG emissions through risk mitigtion, governnce strtegies, nd corporte ctions relted to climte chnge impcts to business opertions. The CPLI includes compnies in the highest-performnce bnd (A) with rnge nd qulity of emissions-reduction ctivities tht re considered to be more fundmentl to progress on combting climte chnge. PERFORMANCE IN THE CDP Climte Chnge S&P 500 Rnking (2009-2013) Evlution of Corporte Climte Chnge Governnce, Strtegy, nd Emissions- Reduction Performnce 100 99 DISCLOSURE SCORE (TRANSPARENCY) 90 80 70 42 2009 No Rnking LEADER 80 68 C 2011 2010 B LEADER PERFORMANCE (EMISSIONS REDUCTIONS) A- 90 A 2013 2012

OUR COMMUNITY INVESTMENT EDUCATION The min focus of our corporte philnthropy is expnding nd bettering the pipeline of tlented science, technology, engineering, nd mthemtics students ntionwide. We im to invest in nd implement progrms tht re comprehensive in scope, brod-bsed in rech, nd ongoing for the long term. 2013 Highlights We contributed $26,698,705 in philnthropic dontions (tht totl included $15 million gift from Northrop Grummn to our chritble trust, the Northrop Grummn Foundtion) through our Northrop Grummn chritble giving progrm. Funding from the Northrop Grummn Foundtion dded n dditionl $11,435,743. Our employee chrity orgniztion (ECHO) contributed $2,280,895 to multitude of community-bsed nd ntionl nonprofit orgniztions. Additionlly, F rom July 21 to August 1, Conservtion Interntionl stff, s prt of the Northrop Grummn Foundtion s ECO Clssroom progrm, hosted 16 middle nd high school life sciences techers t L Selv Biologicl Sttion in Cost Ric. A s prt of our CyberPtriot progrm, we hired 32 former prticipnts, up from 28 in 2012, who re now performing criticl functions in Northrop Grummn progrms nd informtion security infrstructure cross the United Sttes. T hrough Northrop Grummn Foundtion funding, we significntly incresed our support of the VEX Robotics progrm, helping tems cross the globe prticipte in the progrm nd supporting the world chmpionship event. We executed our strtegies for corporte citizenship: STEM eduction, employees contributed more thn $1.5 million to progrms such s USO the environment, nd supporting our troops nd veterns. In ddition, cmpigns, disster relief, nd holidy giving. we developed nd implemented strtegy for interntionl corporte citizenship. 31

OUR COMMUNITY INVESTMENT 2013 Mjor Gols Totl 2013 Giving = $41 Million GOAL Support wide rry of progrms nd services for eduction, militry nd veterns, the environment, nd helth nd humn services through brodbsed philnthropy. In 2013, we mintined the following trget percentges for directing our community spending : 50% eduction with strong focus on science, technology, engineering, nd mthemtics progrms 20% helth nd humn services 30 25 20 15 $28.8 Million All other philnthropic dontions Totl to STEM eduction From employees through vehicles such s gifts to eduction, the utonomous nonprofit Employees Chrity Orgniztion (ECHO) of Northrop Grummn, holidy giving progrms, the USO, nd disster relief 20% militry nd veterns 10 $8.2 Million 32 5% environment 5% ll other PERFORMANCE Our spending gols in ech re re trget percentges, nd we do not lwys chieve our trgets in ll res. In 2013, we mde progress towrd incresing funding in the militry nd veterns ctegory s well s the environment, which were underfunded ctegories in 2012. 2013 Actul Giving Alloction Percentges 53% Eduction 12% Helth nd humn services 19% Militry nd veterns 4% Environment 12% Other: The remining percentge of our giving fell into res outside of these brod ctegories. GOAL Improve ntionwide eduction t ll levels with focus on science, technology, engineering, nd mthemtics (STEM) proficiency. PERFORMANCE We support progrms nd services for STEM eduction, militry nd veterns, the environment, nd helth nd humn services through strtegic, trgeted philnthropy progrm. We focused 2013 efforts on improving the qulity of STEM eduction from erly grdes through the university level, with n dditionl focus on middle school students nd techers, nd on developing student interest, understnding, nd tlent in those res. $ Million 5 $4 Million 0 To ccomplish this corporte citizenship mission, in 2013, we continued to implement the Northrop Grummn eduction strtegy cross the compny. While we continue to increse involvement with diversity progrms such s Viv Technology nd Science Engineering Experience for Kids (SEEK), we ctively sought progrms for femle students. Highlighted Progrms Philnthropic dontions In 2013, we contributed $26,698,705 in philnthropic dontions tht included $15 million gift from Northrop Grummn to our chritble trust, the Northrop Grummn Foundtion, through our Northrop Grummn chritble giving progrm. Funding from the Northrop Grummn Foundtion dded n dditionl $11,435,743. Mtching Gift for Eduction progrm The Northrop Grummn Foundtion mtches the first $1,000 per employee for gifts mde to qulifying eduction orgniztions ech yer. Our totl compny outly on mtching gifts during 2013 ws $683,772, with 1,692 employees using the resource. Of tht totl, $307,584 went to K-12 progrmming nd $376,188 to higher eduction.

OUR COMMUNITY Eduction Progrms ECO Clssroom CyberPtriot VEX Robotics Spce Cmp High School Involvement Prtnership ECO Clssroom Diversity Eduction Progrms Higher Eduction With the gol of providing techers with resources nd lerning opportunities in environmentl science, we gin collborted with Conservtion Interntionl to lunch the ECO Clssroom progrm. This unique, ntionwide professionl development progrm equips techers with knowledge nd inspirtion. The focus: encourging students t ll levels to pursue science nd technicl creers nd, eventully, becoming our next genertion of environmentl stewrds nd innovtors. PERFORMANCE From July 21 to August 1, 2013, Conservtion Interntionl stff hosted 16 middle nd high school life sciences techers in biology, ecology, environmentl nd erth systems science t the Conservtion Interntionl s tropicl ecology ssessment nd monitoring network s field site t L Selv Biologicl Sttion in Cost Ric. The techer tems trveled from Cliforni, Illinois, nd Mississippi for this intensive rel-world experience. The techers returned to their schools with more in-depth understnding of the interreltionship between biodiversity, climte chnge, nd humn ctivities, nd equipped with new techniques nd resources to enhnce teching. Since the progrm inception, we hve reched n estimted 8,500 science, technology, engineering nd mthemtics students from 32 U.S. middle nd high schools. A survey question for the 2013 clss of techers sked, How pplicble will your group project be in your clssroom? On scle of 1 to 5 with 5 being extremely pplicble, the group collectively rted the pplicbility s 4.8. Relignment: As prt of the Office of Globl Corporte Responsibility restructuring, we religned our Corporte Citizenship orgniztion during 2013. All Corporte Citizenship professionls now report to the corporte office nd re ligned regionlly. In ddition, we estblished new interntionl corporte citizenship mnger position. Overll, we believe this new structure will better serve our employees nd our communities. In ddition, with the clss of 2012 techers who hve hd full school yer in the clssroom since their experience, we cn report: The percentge of techers collecting field dt with their students following the ECO Clssroom incresed by 63 percent (from 221 to 354 students). This trnsltes to men increse of 12.1 students doing fieldwork per techer per yer, which is very encourging result. After the ECO Clssroom, teching focused on lnd use issues incresed 11 percent. Survey respondents indicted tht ECO Clssroom succeeded in giving them more depth to effectively tech this topic. The proportion of instructors teching lessons nd topics focused on climte chnge incresed 20 percent. Bsed on the written comments, mny of the eductors tech this topic more thoroughly fter ECO Clssroom. The ECO Clssroom incresed integrtion of techer trvel experiences into lessons 175 percent. This is key output for STEM teching becuse motivted techers crete motivted students. Finlly, the use of GIS nd stellite dt by techers to formulte scientific questions in lessons incresed 75 percent. Following the ECO Clssroom experience, selected techers led workshops t the Ntionl Science Techers Assocition Conference. Approximtely 70 techers ttended the workshops nd introduced n estimted 1,120 students to the progrm. CyberPtriot V: High School Competition Through the Northrop Grummn Foundtion, we renewed our commitment s presenting sponsor for this Air Force Assocition effort. CyberPtriot, which completed its fifth yer in 2013, is the ntion s lrgest nd fstest-growing high school cybersecurity defense competition designed to excite, educte, nd motivte the next genertion of cyber-defenders. Students competed t the CyberPtriot V Ntionl Finls Competition Mrch 14 to 16, 2013, in Wshington, D.C. We hd 64 volunteers from cross the corportion mentor students nd provide technicl ssistnce to tems. CyberPtriot offers n opportunity for our employees to support criticl need for our ntion s continued security nd 33

OUR COMMUNITY INVESTMENT economic prosperity. For CyberPtriot VI in 2014, Also in 2013, we begn concept development for competed in more thn 400 events globlly. These ech Northrop Grummn volunteer is gurnteed n elementry school element of CyberPtriot. students represented 25 countries. For the 2013-2014 ssignment to tem, improving the likelihood of With these expnsions of the progrm beyond the competition yer, VEX will be ble to estblish tems incresed volunteer registrtion. originl high school effort, Air Force Assocition nd competitions in Austrli nd expnd progrmming representtives begn rebrnding CyberPtriot s in the United Kingdom. PERFORMANCE During 2013, we hired 32 CyberPtriots, up from 28 in 2012, who perform criticl functions within Northrop Grummn progrms nd informtion security infrstructure cross the United Sttes. In The Ntionl Youth Cyber Eduction Progrm. In ddition, efforts in 2013 included development of interntionl expnsion with initil enggement t the 2014 King Sud University Technology Symposium. Through the Northrop Grummn Foundtion, we renewed our prtnership with the U.S. Spce nd Rocket Center in Huntsville, Albm, to support ddition, we mintin communiction with mny VEX Robotics student nd eductor prticiption in the progrm. more CyberPtriot competitors s they consider higher Through 2013 Northrop Grummn Foundtion Student cmpers went through the ultimte spce eduction options nd creers in STEM disciplines. funding, we incresed our support of VEX Robotics dventure, prticipting in ctivities such s building to become the progrm s presenting sponsor. This nd lunching rockets, experiencing weightlessness sponsorship helped tems globlly nd supported in n stronut-trining simultor, nd simulting the world chmpionship event. spce trvel preprtion. Their science techers Through robust communictions cmpign by Air Force Assocition representtives nd Northrop Grummn communictions nd volunteers, we incresed the number of tems to 1,225 in We chose to increse our support to this progrm CyberPtriot V, up from 1,014 in CyberPtriot IV bsed on the commitment of the VEX ledership during 2012. Enrollment for CyberPtriot VI is 1,560 tem nd their dediction to incresing student tems, representing 136 percent increse since our interest nd involvement in STEM through hnds- Northrop Grummn Foundtion sponsorship begn. on, sustinble, nd ffordble curriculum-bsed robotics engineering progrms. Additionlly, the We provided $50,000 in orgniztion is well-positioned to support progrm scholrship funds to students expnsion globlly. from the top three tems PERFORMANCE per division in CyberPtriot More thn 100,000 students from 8,000 tems V, enbling mny students to relize their drem of erning college eduction in technicl disciplines. Since becoming presenting sponsor, Northrop Grummn hs wrded more thn $150,000 to CyberPtriot competitors. As interest nd prticiption in CyberPtriot continue to grow, the Air Force Assocition, in prtnership with our Northrop Grummn Foundtion, hs estblished progrm expnsion priorities. In 2013, pilot progrm ws lunched for middle school students. Full implementtion of the middle school progrm is slted for 2014. 34 Spce Cmp ttended the Spce Acdemy for Eductors, progrm designed to provide techers the tools to enhnce how they use STEM concepts in their clssrooms. And, for the first time in five yers of progrm support, we were ble to expnd the progrm interntionlly. PERFORMANCE The 2013 sponsored spce cmpers comprised 17 middle school techers from eight sttes nd 65 middle school students from 10 sttes nd the

OUR COMMUNITY District of Columbi. Two students nd one techer were from the United Kingdom. High School Involvement Prtnership This progrm ssists high school students with setting creer nd development gols nd provides student internships, mentoring, grdution incentives, summer enrichment progrm, nd potentil scholrships. PERFORMANCE In 2013, we connected Northrop Grummn mentors with more thn 330 high school students from 75 schools. Additionlly, Northrop Grummn Foundtion funding gin supported the White House s Summer Jobs+ inititive. This progrm provided summer jobs nd other employment opportunities for low-income nd disconnected youth. Through this effort, 19 nonprofit gencies received funding to support 82 intern positions. Higher Eduction COLLEGE SCHOLARSHIPS Through Northrop Grummn Foundtion funding, we provided lmost $120,000 in ntionl diversity ssocition scholrships to vrious orgniztions. These include: the Americn Indin Science nd Engineering Society, Gret Minds in STEM, Ntionl Society of Blck Engineers, Society of Hispnic Professionl Engineers, Society of Women Engineers, nd United Negro College Fund. Additionlly, the Northrop Grummn Foundtion funded $100,000 to the Ntionl Action Council for Minorities in Engineering in support of scholrships nd pre-engineering progrms. SUMMER INTERN PROGRAMS Through Northrop Grummn Foundtion, we funded more thn $91,000 in Summer Internship Progrms supporting mny of the orgniztions listed under College Scholrships, long with Americn Assocition of People with Disbilities. Additionlly, the Northrop Grummn Foundtion funded the Delt Reserch nd Eductionl Foundtion Summer Interns for STEM Project to increse interest in science, technology, engineering, nd mthemtics nd relted creers. University Reltionships We provided, through Northrop Grummn Corportion, more thn $1.4 million in higher eduction grnts to more thn 71 colleges nd universities. Recipients included cdemic nd diversity student orgniztions, business progrms, creer development nd ledership progrms, competitions, engineering nd computer science progrms, fellowship progrms, K-14 EDUCATION GRANTS TO SUPPORT CYBER SECURITY PROGRAMS: University of Mrylnd College Prk Advnced Cyber Security Experience for Students (ACES) progrm Cliforni Polytechnic Stte University-Sn Luis Obispo Cyber Security Lb United Sttes Nvl Acdemy Center for Cyber Security Studies EDUCATION GRANTS TO SUPPORT K 14 STEM PIPELINE PROGRAMS AT NINE UNIVERSITIES: Cliforni Stte University (Northridge) Georgi Institute of Technology Morgn Stte University North Crolin Stte University Pririe View A&M University Rice University University of Cliforni Los Angeles University of Mrylnd College Prk University of Texs (Austin) STEM pipeline progrms, scholrships, student design nd reserch projects, nd mny more. Some of the progrms include: Americn Institute of Aeronutics nd Astronutics student design-fly-build competition Assocition for Unmnned Vehicle Systems Interntionl Cube St/Stellites projects Electro Science Lb fellowship support Engineering Ph.D. pipeline inititives Reserch Experiences for Undergrdutes support in electricl nd computer engineering for cybersecurity progrm Unmnned eril vehicle collbortive engineering projects. 35

OUR COMMUNITY Focusing on Diversity Eduction During 2013, we plced dditionl focus on identifying progrms to increse the interest of young girls in STEM creers. We continued our support of the Ntionl Society of Blck Engineers Summer Engineering Experience for Kids progrm nd Gret Minds in STEM s Viv Technology. SciGirls is PBS series tht documents different groups of enthusistic girls who collborte, communicte, engineer, nd discover. The girls re ccompnied by two nimted chrcters who tie the series together both online nd on television with their STEM-infused dventures. The SciGirls episodes, website, nd eduction mterils re developed bsed on reserch showing wht engges girls in STEM lerning nd creers. We will continue our reltionship with SciGirls in 2014 with SciGirlsled workshop tht will be held in conjunction with the Northrop Grummn Women s Conference. In 2013, we estblished two new nd exciting reltionships with orgniztions whose missions lign with our corporte environmentl gols: Engineers Without Borders nd the Arbor Dy Foundtion. Engineers Without Borders Through our reltionships with Engineers Without Borders, we supported seven wter supply projects in Keny, Nicrgu, Brzil, Mdgscr, nd Tnzni. Four of the projects supported university student-led inititives nd three supported U.S.- bsed professionl chpter projects. Arbor Dy Foundtion Our reltionships with the Arbor Dy Foundtion supported the U.S. Forest Service nd Colordo Stte Forest Service replnting efforts in Cliforni nd Colordo where wildfires left forestlnd brren. Our support lso ided interntionl forest projects. Interntionlly, we supported project in southwestern Guteml s Sierr Mdre Highlnds to reforest nd protect key res nd wtersheds in region tht is currently impcted by n nnul deforesttion rte of 1.6 percent. We lso supported United Kingdom project with the Ministry of Defence to improve the militry trining fcilities nd enhnce the biodiversity of those sites. Northrop Grummn Foundtion funding supports middle school students with 24 pilot progrms in 15 sttes, reching diverse community of nerly 800 middle school girls with 25,000 hours of instruction in computing nd technology. Through the Northrop Grummn Foundtion, we estblished reltionship with the Ntionl Center for Women nd Informtion Technology to further develop the Aspirtion in Computing progrm. This progrm is tlent development pipeline inititive designed to increse femle prticiption in technology creers by providing encourgement, visibility, community, ledership opportunities, scholrships, nd internships to high-potentil, techniclly minded young women. 36

VOLUNTEERISM A Strong Trdition t Northrop Grummn Northrop Grummn employees contributed 18,920 documented volunteer hours nd qulified orgniztions, in turn, received $94,600 in community service grnts from Northrop Grummn. In ddition, Volunteer1NG, our volunteer mngement system, recorded 11,175 employee volunteer hours from 652 individul employees, bringing the totl to 30,095 hours. Further, employees generously supported multitude of nonprofits through in-kind giving such s bck-to-school supply drives, dopt militry fmily, winter cot drives, nd holidy giving. Environmentl Volunteers Our presence in communities cross the United Sttes llows Northrop Grummn employees to support diverse nd importnt environmentl nd eductionl inititives ntionwide. Exmples of our 2013 volunteer inititives include: Bech nd Costl Clenups: Along the est, Gulf, nd west costs, employees prticipted in bech clenup events, collecting trsh nd debris to improve locl nd regionl wterwys. Ntionl Public Lnds Dy: Across the compny, employees supported this ntionwide one-dy event by plnting ntive trees nd plnts, nd helping to beutify nd clen public lnds. During 2013, we estblished reltionship with nonprofit orgniztion to implement compny-wide volunteer progrm. Our reltionship with the Americn Cncer Society llows employees cross the United Sttes to prticipte in the Rely for Life. Additionlly, we worked with the Americn Cncer Society to estblish the Northrop Grummn Globl Week of Cring to rise funding for cncer progrms nd reserch worldwide. Unfortuntely, the government shutdown in October 2013 impcted our bility to roll out this progrm. We rescheduled nd held the event in erly 2014. OUR COMMUNITY Promoting eduction nd prticipting in volunteerism go hnd-in-hnd t Northrop Grummn. During Ntionl Engineers Week, hundreds of our employees volunteer ntionwide in schools. To prepre for these events, we provide volunteers with tools nd mterils to ssist with clssroom demonstrtions. Recognizing Excellence We recognize employees who hve demonstrted volunteer dediction through our Northrop Grummn volunteer recognition progrm. In August 2013, through Northrop Grummn s office of corporte citizenship, we nnounced the 10 Excellence in Volunteerism winners chosen from 231 nomintions by n independent reviewer (compred to 647 nomintions in 2012). Additionlly, we expnded this progrm to include nomintions for employees globlly. Ech wrd winner s chosen orgniztion received $5,000 grnt tht, collectively, helps students, communities, the environment, those in need, nd fmilies. PERFORMANCE The community impct of our employee volunteer hours for 2013 ws more thn $300,000 (bsed on independent 2013 estimted vlue of volunteer time t $10/ hour). Since inception, we vlue our volunteer totl community impct t more thn $2.5 million. During 2013 we lso funded environmentl protection projects led by the following orgniztions: Ancosti Wtershed Society Chespeke By Foundtion Hel the By Ntionl Council for Science nd the Environment Ntionl Public Lnds Dy Potomc Conservncy Wter for People Wter Wells for Afric When we estblished our reltionship with the Rely for Life, our fundrising gol ws $50,000. With our employees, we were ble to more thn double tht gol: 292 employees representing 26 tems rised $110,000. 37

OUR COMMUNITY DISASTER RELIEF Mjor nturl dissters in the United Sttes during 2013 included Colordo nd Cliforni wildfires, Oklhom torndoes, centrl region storms, nd floods in Colordo. These events ffected severl communities with strong presence of Northrop Grummn employees. Additionlly, Typhoon Hiyn devstted the Philippines in November. PERFORMANCE We re members of the Americn Red Cross Annul Disster Giving Progrm. This progrm helps secure relible funding bse for disster relief services nd enbles Red Cross personnel to respond immeditely to the needs of individuls nd fmilies ffected by disster. Affected people received food, shelter, emotionl support, nd other essentil ssistnce with less dely. Northrop Grummn employees donted $121,109 in support of the U.S. dissters noted bove. The Northrop Grummn Foundtion mtched tht mount. Through Northrop Grummn, we lso provided dditionl grnts to orgniztions providing support for victims of the Colordo wildfires nd flooding. The Northrop Grummn Foundtion bord of directors pproved n dditionl $150,000 grnt to the Americn Red Cross to ssist with immedite needs of the victims of Typhoon Hiyn. Additionlly, $150,000 mtching gift progrm for employees ws pproved. We hd tremendous response from employees who donted totl of $154,602. MILITARY AND VETERANS In 2013, the corporte citizenship tem implemented new strtegy to support ctive duty militry nd veterns: WOUNDED WARRIORS: helth, heling nd recovery FAMILIES: strengthening inititives nd ddressing low-income concerns HOMELESSNESS: services for the homeless EMPLOYMENT: trining nd employing returning troops nd wounded wrriors APPRECIATION: recognizing contributions of ctive-duty militry in/ner our operting communities We re plesed to estblish reltionship with Locl Inititives Support Corportion to help develop housing nd relted fcilities tht focus on the unique needs of homeless nd low-income veterns. Funds provided by Northrop Grummn supported predevelopment nd cpitl ssistnce grnts. Six grnts helped develop 261 units of ffordble housing trgeted to veterns nd supported socil service progrms tht nnully ssist hundreds of other homeless nd t-risk veterns return to more productive lives. Grnts trgeted progrms in the New York metropolitn re (Long Islnd nd 38

OUR COMMUNITY INVESTMENT the Bronx); Los Angeles re (Inglewood); Sn Frncisco By re (Menlo Prk); Houston, Texs; nd Denver, Colordo. Projects included the construction of 60-unit homeless veterns nd veterns fmilies project; the renovtion of job trining clssroom, computer lb nd community room; predevelopment costs of new 60-unit veterns residence; predevelopment costs for new 60-unit, permnent, ffordble supportive housing for veterns who re homeless, formerly homeless, or t risk of homelessness; predevelopment finncing for 105-unit project for single dult low-income nd homeless veterns, nd cpitl grnt finncing for housing for homeless vetern single women nd women nd children. Americn Corporte Prtners Americn Corporte Prtners is n orgniztion tht helps post-9/11 veterns trnsition to the privte sector through yer-long, one-on-one mentoring reltionships with corporte professionls. The response from Northrop Grummn s ledership tem ws tremendous with 73 mentors pired with protégés in 11 different sttes. Our support of Luke s Wings llowed our employees to support the No Soldier Spends the Holidys Alone cmpign. Csh dontions nd donted frequent flyer miles llowed wounded wrriors to reunite with their fmilies during the holidy. While we fell short of the fundrising gol of $25,000, employees contributed more thn $11,000. The dontion of frequent flyer miles exceeded our expecttions nd the orgniztion sw n increse of more thn 160,000 donted ir miles during our cmpign. Deprtment of Veterns Affirs recognize Opertion IMPACT s n industry best prctice, nd the progrm hs received severl wrds. Northrop Grummn is committed to be n employer of choice for veterns, s evidenced by the fct tht veterns comprise 30 percent of our new employees. EC1 Community Impct: Although we do not trck dt for this specific metric t Northrop Grummn, the direct economic vlue generted through our vrious dontions nd community investments is significnt. Collectively, for 2013, when totling revenues, operting costs, employee compenstion, compny philnthropic contributions, employee giving, nd the vlue of totl employee volunteerism hours, we provide substntil direct economic vlue to our communities. This report uses Globl Reporting Inititive (GRI) Performnce Indictors such s this to trck nd monitor performnce. For full listing, see GRI Content Index on pge 40. GRI Opertion IMPACT Proposed by Northrop Grummn employee in 2004, Opertion IMPACT (Injured Militry Pursuing Assisted Creer Trnsition) provides personlized creer trnsition ssistnce by identifying creer opportunities within the compny for returning service members who hve been severely injured in combt. If the service member is unble to work, the progrm offers creer support to member of the individul s immedite fmily who will become the primry wge erner s well s to the widow or widower of fllen service members. PERFORMANCE To dte, the progrm hs helped 118 returning service personnel nd their fmily members join the compny. Since 2009 we hve operted the Network of Chmpions, group of more thn 120 corportions nd orgniztions, including the federl government, following our exmple in the hiring of wounded wrriors. The purpose of this network is to expnd job plcement opportunities for qulified cndidtes. The Network of Chmpions hs plced 41 Opertion Impct cndidtes since 2009. Executives from the Deprtment of Defense, Deprtment of Lbor, nd 39

GRI CONTENT INDEX This 2013 Corporte Responsibility Report reflects the G3 Sustinbility Reporting Guidelines of the Globl Reporting Inititive (GRI). The Stndrd Disclosures nd the degree to which we hve been ble to report on ech re detiled on this pge. The full GRI Content Index includes the Disclosures on Mngement Approch, ll Performnce Indictors, nd more detiled resons for prtil reporting nd/or omission of dt. To view, visit crreport.northropgrummn.com. 40 GRI Stndrd Disclosure STRATEGY AND ANALYSIS 1.1 Sttement from CEO. 2 1.2 Key impcts, risks, nd opportunities. 2-5 ORGANIZATIONAL PROFILE 2.1 Orgniztion nme. 3-5 2.2 Primry products nd services. 3-5 2.3 Opertionl structure of the orgniztion. 3-5 2.4 Loction of hedqurters. 4 2.5 Countries with mjor opertions. 3-5 2.6 Ownership nd legl form. 3-5 2.7 Mrkets served. 3-5 2.8 Scle of orgniztion. AR, 23 2.9 Significnt opertionl chnges. 3-5 2.10 Awrds received. Listed Throughout REPORTING PARAMETERS 3.1 Reporting period defined. 1 (clendr yer 2012) 3.2 Dte of most recent previous report. 1 3.3 Reporting cycle defined. 1 3.4 Contct informtion. WB 3.5 Process for defining report content. 1 3.6 Boundry of the report. 1 3.7 Specific limittions on scope or boundry. 1 3.8 Reporting defined for joint ventures, etc. NA 3.9 Dt mesurement techniques defined. 1, 36-37 3.10 Explntion of ny re-sttements from erlier reports. 3-5 3.11 Significnt chnges from previous reporting periods. 1, 36-37 3.12 Stndrd Disclosures tble provided. 36-37 3.13 Externl ssurnce process defined. 1 GOVERNANCE, COMMITMENT AND ENGAGEMENT 4.1 Governnce structure. 9-11 4.2 Indicte whether Bord Chir is lso n executive officer. 9-11 4.3 Number of independent nd/or nonexecutive Bord members. 9-11 4.4 Mechnisms for providing recommendtions to Bord. 9-11 4.5 Linkge between compenstion nd performnce. 9-11 4.6 Processes for eliminting conflicts of interest. 9-11 4.7 Process for determining Bord member qulifictions. 9-11 4.8 Sttement of vlues nd codes of conduct. Inside Front Cover nd WB 4.9 Procedures for complince with stndrds, codes, nd principles. 6-11 4.10 Processes for evluting the Bord's performnce. 10 4.11 Precutionry pproch explntion. 18-29 4.12 Externl inititives endorsed. 20-21, 23-25, 27-33 4.13 Memberships in ssocitions nd dvoccy orgniztions. 25 4.14 Stkeholder groups identified. 20-21, 23-25, 30-33 4.15 Selection of stkeholders with whom to engge. 21-25, 30-33 4.16 Approches to stkeholder enggement. Throughout 4.17 Key stkeholder topics nd concerns. 18-19 GRI Stndrd Disclosure Pge Reference Sttus ECONOMIC PERFORMANCE INDICATORS Pge Reference Sttus EC01 Direct economic vlue generted. 39 EC02 Finncil implictions due to climte chnge. 28 EC03 Defined benefit pln coverge. NA EC04 Government finncil ssistnce. NA EC05 Wges compred to locl minimum wge. NA EC06 Spending on loclly bsed suppliers. 18 EC07 Senior mngers hired from the locl community. NA EC08 Investments for public benefit through in-kind/pro bono. 30-35 EC09 Indirect economic impcts, including the extent of impcts. 30-35 ENVIRONMENTAL PERFORMANCE INDICATORS EN01 Mterils used by weight or volume. NA EN02 Percentge of recycled mterils. NA EN03 Direct energy consumption. 26 EN04 Indirect energy consumption. 26 EN05 Energy sved through conservtion. 26 EN06 Energy-efficient bsed products nd reductions in energy requirements. 20, 26-31 EN07 Inititives to reduce indirect energy consumption. 20, 26-31 EN08 Totl wter withdrwl by source. NA EN09 Wter sources ffected by withdrwl of wter. NA EN10 Percentge nd totl volume of wter recycled nd reused. 28 EN11 Lnd ownership nd opertions in protected res of high biodiversity 27 vlue. EN12 Impcts on biodiversity in protected res. 27 EN13 Hbitts protected or restored. 27 EN14 Mnging impcts on biodiversity. 24 EN15 Hbitts (Red List species) ffected by opertions. 27 EN16 Totl direct nd indirect greenhouse gs emissions. 26 EN17 Other relevnt indirect greenhouse gs emissions. 26 EN18 Inititives nd results of reducing greenhouse gs emissions. 26-30 EN19 Emissions of ozone-depleting substnces. 26 EN20 NOx, SOx, nd other significnt ir emissions. NA EN21 Totl wter dischrge by qulity nd destintion. NA EN22 Totl weight of wste by type nd disposl method. 25 EN23 Totl number nd volume of significnt spills. 21 EN24 Wste deemed hzrdous under Bsel Convention Annex I, II, III, nd VIII. 25 EN25 Biodiversity vlue of wter bodies nd hbitts ffected. 27 EN26 Inititives to mitigte environmentl impcts. 19-21, 26-31 EN27 Pckging mterils reclimed by ctegory. 25 EN28 Significnt fines nd non-monetry snctions for non-complince. 21 EN29 Environmentl impcts of trnsporting products nd mterils. 26-27 EN30 Totl environmentl protection expenditures. 25

GRI CONTENT INDEX This 2013 Corporte Responsibility Report uses the G3 Sustinbility Reporting Guidelines of the Globl Reporting Inititive (GRI). All of the Stndrd Disclosures nd the degree to which we hve been ble to report on ech re detiled on this pge. APPLICATION LEVEL CHECK The GRI Appliction Level Check confirms tht sustinbility report hs the required set nd number of disclosures to meet the orgniztion's self-declred Appliction Level (see next pge). GRI Stndrd Disclosure SOCIAL PERFORMANCE INDICATORS: LABOR PRACTICE AND DECENT WORK Pge Reference Sttus LA01 Totl workforce by employment type. 14 LA02 Employee turnover by ge group, gender, nd region. 14 LA03 Benefit coverge for full-time vs. prt-time employees. 14 LA04 Percentge of employees covered by collective brgining greements. 14 LA05 Minimum notice period(s) for termintion. 14 LA06 Description of mngement-worker helth nd sfety committees. 23 LA07 Rtes of injury, lost dys, nd ftlities. 22 LA08 Inititives relted to serious diseses. 22-23 LA09 Helth nd sfety topics covered in forml greements with trde unions. 23 LA10 Averge hours of employee trining per yer. 19-23 LA11 Skills mngement progrms for employees. 14 LA12 Percentge of employees receiving regulr performnce nd creer development reviews. 14 LA13 Composition of governnce bodies nd employees by diversity indictors. 9-11 LA14 Rtio of bsic slry of men to women by employee ctegory. NA HR01 Investment greements tht include humn rights cluses nd screening. 18 HR02 Suppliers nd contrctors tht hve undergone humn rights screening. 18 HR03 Policies nd procedures concerning humn rights. 14 HR04 Totl number of incidents of discrimintion nd ctions tken. 14 HR05 Opertions identified where freedom of ssocition nd collective brgining my be t risk. 14 HR06 Opertions identified for incidents of child lbor. 18 HR07 Opertions identified for incidents of forced or compulsory lbor. 18 HR08 Percentge of security personnel trined humn rights spects. 14 HR09 Violtions involving rights of indigenous people. 18 SOCIAL PERFORMANCE INDICATORS: SOCIETY SO1 SO2 Inititives tht ssess nd mnge the impcts of opertions on communities. Percentge nd totl number of business units nlyzed for corruption risks. 18-20, 24-25, 27-33 9 SO3 Percentge of employees trined in orgniztion s nti-corruption policies nd procedures. 9 SO4 Actions tken in response to incidents of corruption. 9 SO5 Public policy positions nd prticiption in public policy development nd lobbying. 9 SO6 Totl vlue of finncil nd in-kindcontributions to politicl ctivities. 9 SO7 SO8 Legl ctions for nti-competitive behvior, nti-trust, nd monopoly prctices. Significnt fines nd non-monetry snctions for non-complince with lws nd regultions. 9 9 STATUS: FULLY REPORTED PARTIALLY REPORTED NOT REPORTED AR= ANNUAL REPORT WB= WWW.NORTHROPGRUMMAN.COM 41