Reviewing our anti-corruption programme

Ethics and anti-corruption
We want our employees and stakeholders to take pride in what we do and how we do it so that we can be a leader in responsible business conduct.
To us this means staying abreast of best practice, periodically reviewing our processes and procedures and implementing changes where necessary. 
 
The key document underpinning our anti-corruption programme is the Code of Conduct. We review this every three years and update it if required to maintain its best in class standard. We are aided by the Institute of Business Ethics and Gartner in doing so, and benchmark ourselves against other large businesses as a way of learning and developing our processes.
 
We similarly benchmark against others to ensure our training programmes are up to date and have regular dialogue with ethics associations and industry bodies to review external practices. 
 
We place a large degree of importance on our ethics helpline, in terms of encouraging our employees to use it. To us, more calls to the helpline are an indicator of our success in this area, demonstrating that employees are comfortable to raise issues that concern them without fear of retaliation. 
 
To continue to offer a high standard of helpline, we engage with suppliers and other third parties to seek ways of improving or further developing the service.
 
The Operational Framework governing the suite of global policies, including our anti-corruption programme, is also reviewed every year, with the policies also reviewed regularly.
 

Woolf Committee 

The Woolf Committee was convened in 2007 by Lord Chief Justice Woolf, to enhance the ethical practices at BAE Systems. Lord Woolf was asked, along with Philippa Foster Back, Director of The Institute of Business Ethics, Douglas Daft AC, ex Chair of Coca Cola, and Sir David Walker, former Chairman of Morgan Stanley International, to evaluate our ethical policies and processes and to make recommendations to become a world leading ethical business. BAE Systems undertook to implement all of the recommendations in advance of the completion of the review.
 
There were 23 recommendations in total, all of which were implemented within three years, and the practices introduced remain to this day but continue to be updated and reviewed as part of our ethics programme. They included our appointment of Advisers, the introduction of a global Code of Conduct, how we deal with facilitation payments, and the senior executive’s role in supporting ethical conduct, among many others. 
 
The Woolf Committee report and our responses to it over a three-year period are available on the right.
 

Industry collaboration

To support improving industry standards we are a member of a key industry body for ethics, the International Forum on Business Ethical Conduct (IFBEC).  In 2019, our Head of Ethical Business Conduct became the IFBEC Chair for a two year term.  IFBEC, an association of the major US and European defence manufacturers, was set up to provide a global response to issues affecting the industry as a whole. All members are required to comply with a set of principles (such as eliminating facilitation payments and appropriate payment of advisers), and membership is a key way for defence organisations to show a public commitment to upholding ethics. BAE Systems was a co-founder of IFBEC in 2010 and played a part in developing the Principles with Lord Robertson, the then UK Defence Minister.  
 
We are also members of the Institute of Business Ethics and The Defense Industry Initiative in the US, and sit on the Steering Board of the Business Ethics Network of Aerospace, Defence, Security and Space Group. By working across these groups, we aim to improve ethical standards for the sector as a whole.
 

External Indices – Transparency International

To be open and transparent about our responsible business practices, we report to a number of external organisations on environmental, social and governance issues. These range from investor related agencies, such as Bloomberg, MSCI and others, such as Transparency International (TI).  As well as assessing company practices, TI is involved in seeking to improve anti-bribery and corruption practice across the defence and security sector. They are, therefore, an important stakeholder for us to interact with and report to.  
 
In response to the questions we receive from stakeholders and to be as transparent as possible on this subject, we have produced a brochure explaining our approach to ethics and anti-corruption and this is available on the right.