A proxy board is a requirement imposed under a Proxy Agreement by the U.S. Department of Defense's Defense Security Service on foreign investors seeking to acquire certain American companies. This is for national security reasons and applies mainly to defense contractors which are involved in highly classified contracts. The Proxy Agreement is between the foreign company, the US subsidiary holding classified contracts and the DSS.
A proxy board is a board composed entirely of American citizens which are responsible for the day-to-day running of the business. In this way the company's classified information is "insulated" from foreign exploitation but the parent company still benefits from any profits made by its subsidiary.
A variation is a Special Security Agreement (SSA) where the board of the company can be composed of both American citizens and nationals from the parent company's country. In this case when issues relating to national security are discussed only American managers may participate. SSAs require companies to be run under American law and by American citizens. [1] In May 2006 the CEO of BAE Systems described the "firewalled" status of BAE's US subsidiary, BAE Systems Inc., " The British members of the corporate leadership, me included, get to see the financial results; but many areas of technology, product and programme are not visible to us.... The SSA effectively allows us to operate in the US as an American company, providing the highest levels of assurance and integrity in some of the most sensitive fields of national security provision." [2]
Vickers was a famous name in British engineering that existed through many companies from 1828 until 1999.
Marconi Electronic Systems (MES), or GEC-Marconi as it was until 1998, was the defence arm of General Electric Company (GEC). It was demerged from GEC and bought by British Aerospace (BAe) on 30 November 1999 to form BAE Systems. GEC then renamed itself Marconi plc.
BAE Systems plc (BAE) is a British multinational arms, security, and aerospace company. Its headquarters are in London and Farnborough in the United Kingdom with operations worldwide. The company is the largest defence contractor in Europe and among the world's largest defence companies; it was ranked as the third-largest based on applicable 2017 revenues. Its largest operations are in the United Kingdom and United States, where its BAE Systems Inc. subsidiary is one of the six largest suppliers to the US Department of Defense. Other major markets include Australia, India, and Saudi Arabia, which account for about 20% of BAE's overall sales. It is the biggest manufacturer in Britain. The company was formed on 30 November 1999 by the £7.7 billion purchase and merger of Marconi Electronic Systems (MES)—the defence electronics and naval shipbuilding subsidiary of the General Electric Company plc (GEC)—by British Aerospace, an aircraft, munitions and naval systems manufacturer.
Rolls-Royce Holdings plc is a British multinational aerospace and defence company incorporated in February 2011 that owns Rolls-Royce, a business established in 1904 which today designs, manufactures and distributes power systems for aviation and other industries. Rolls-Royce is the world's second-largest maker of aircraft engines and has major businesses in the marine propulsion and energy sectors.
Tyco International plc was a security systems company incorporated in the Republic of Ireland, with operational headquarters in Princeton, New Jersey, United States. Tyco International was composed of two major business segments: security solutions and fire protection.
Qinetiq is a British multinational defence technology company headquartered in Farnborough, Hampshire. It is the world's 52nd-largest defence contractor measured by 2011 defence revenues, and the sixth-largest based in the UK.
Rolls-Royce North America, Inc. is a subsidiary of multinational corporation Rolls-Royce plc. The American unit operates under a Special Security Arrangement which allows it to work independently on some of the most sensitive United States defense programs despite its foreign ownership. It is involved principally with providing management direction and corporate support for all Rolls-Royce businesses and operations in North America, encompassing more than 7,000 employees at 66 locations across the U.S. and Canada. Its headquarters are in Reston, Virginia.
BAE Systems Inc. is an American subsidiary of British defense, security, and aerospace company BAE Systems plc. The American unit operates under a Special Security Arrangement which allows it to work on some of the most sensitive United States defense programs despite its foreign ownership. It is incorporated in Delaware. It employs approximately 35,000 workers within U.S. borders and several thousand more in Israel, South Africa, Sweden and the United Kingdom. Major business lines of BAE Systems Inc. include electronic warfare, sensing and communications equipment; armored vehicles, artillery systems; naval guns and naval ship repair; and cybersecurity and intelligence services.
Tracor was a major North American defense electronics contractor which was acquired by Marconi Electronic Systems (MES), a subsidiary of General Electric Company plc, in 1998. Following the purchase of MES by British Aerospace in November 1999 to form BAE Systems, Tracor became BAE Systems Integrated Defense Solutions. Following a 2005 reorganisation, the company became BAE Systems Sensor Integration, part of Electronics and Integrated Solutions.
BAE Systems Platforms & Services is a wholly owned subsidiary of BAE Systems Inc.. and is a leading provider of tracked and wheeled armored combat vehicles, naval guns, naval ship repair and modernization, artillery and missile launching systems, advanced precision strike munitions and ordnance, and other technologies for U.S. and international customers. It is the largest such company in the world. It was created on 24 June 2005, following the completion of BAE Systems' acquisition of United Defense in 2004 and its merger with BAE Systems Land Systems. In 2007 BAE Systems acquired Armor Holdings adding to the size of Land & Armaments significantly.
SimplexGrinnell, a subsidiary of Johnson Controls, is an American company specializing in active fire protection systems, communication systems and testing, inspection and maintenance services. The company headquarters is in Boca Raton, Florida; corporate sales and marketing offices are in Westminster, Massachusetts, and the company has about 160 district offices throughout North America. It is currently the largest fire protection company in the world.
Vickers plc was the remainder of Vickers-Armstrongs after the nationalisation of three of its four operating groups: aviation, shipbuilding and steel. It was purchased by Rolls-Royce plc in 1999, and the Vickers company name became defunct in 2004.
Alvis Ltd. was created when United Scientific Holdings plc acquired the Alvis division of the nationalised vehicle manufacturer British Leyland in 1981. United Scientific maintained its own name until 1992 when the group was renamed Alvis plc. Alvis acquired Swedish armoured vehicle manufacturer Hagglunds AB in 1997 and the armoured vehicle business of GKN in 1998. Finally, it acquired Vickers Defence Systems from Rolls-Royce in October 2002. Alvis was acquired by BAE Systems in 2004 and became BAE Systems Land Systems , now part of the BAE Systems Land & Armaments operating group.
Vitro Corporation was a major United States defense contractor which became part of BAE Systems Inc. in 1999.
The aerospace industry of the United Kingdom is the fourth-largest national aerospace industry in the world and the third largest in Europe, with a global market share of 12% in 2018. In 2013, the industry employed 84,000 people.
Royal Ordnance plc was formed on 2 January 1985 as a public corporation, owning the majority of what until then were the remaining United Kingdom government-owned Royal Ordnance Factories which manufactured explosives, ammunition, small arms including the Lee–Enfield rifle, guns and military vehicles such as tanks. It owned some 16 factories; and employed about 19,000 staff.
Wormald is an Australian fire protection brand founded in 1889.
Aero Engine Controls is the former name of Rolls-Royce Controls and Data Services. The company produces engine control software, electronic engine controls (EEC), fuel metering units (FMU), fuel pumps and engine actuators for a large number of common commercial and military aircraft. Together these parts comprise the control system for a jet engine, responsible for delivering the correct amount of fuel and maintaining engine safety.
Rolls-Royce Controls and Data Services Limited provides safety critical controls and asset intelligence solutions for industrial power, marine, civil and military aerospace. It produces engine control software, electronic engine controls (EEC), fuel metering units (FMU), fuel pumps and engine actuators for a large number of common commercial and military aircraft. Together these parts comprise the control system for a jet engine, responsible for delivering the correct amount of fuel and maintaining engine safety.
BAE Systems Maritime – Maritime Services is a wholly owned subsidiary company of BAE Systems, specialising in the repair and maintenance of Royal Navy vessels, as well as product development, naval training and through life support for radar, torpedoes and small boats. Along with BAE Systems Maritime – Submarines and BAE Systems Maritime – Naval Ships, it is one of three divisions of BAE Systems Maritime.