On 6 May 2008, the Woolf Committee published its report on BAE Systems’ ethical business practices and policies, and issued a series of recommendations for making the company a world leader in this field. Recommendations included:
- The adoption of a global code of ethical business conduct, which would apply throughout the company regardless of location, unless local laws require a higher standard.
- The appointment of a senior executive to take responsibility for the implementation of the code. This person would report to the CEO and have direct access to the Chair of the Corporate Responsibility Committee.
- The regular assessment of business conduct, practice and progress by external auditors.
- Enhanced diligence and transparency in the use of agents and in regard to offsets.
- The instigation of internal investigations into allegations of unethical behaviour and the disclosure of material findings to the relevant authorities.
Mark Pyman, leader of TI(UK)’s defence sector programme stated “TI(UK) welcomes the proposals outlined in the Woolf Committee’s report. The proposals, if rigorously and consistently implemented and monitored, should go a long way towards reducing the company’s vulnerability to corruption. TI(UK) looks forward to seeing how the company will demonstrate its commitment to becoming a leader and not a laggard in ethical behaviour.”
However, in light of the consistent allegations of misconduct in the Al Yamamah contract and the damage it has caused to the company and to the United Kingdom, TI(UK) is disappointed with the Committee’s failure to require enhanced safeguards in the new Salaam contract. An assurance that the contract “should not in itself create risks of unethical conduct to the company” does little to allay fears, and is not in line with the principles of transparency broadly endorsed by the Report. The Report, rightly, urges the government quickly to bring forward anti-bribery legislation, which has been scandalously delayed. The Report might have been more rigorous in the treatment of 'hospitality and gifts'.
Laurence Cockcroft, Chairman of TI(UK) said “this is an important first step for BAE Systems in rebuilding its damaged reputation. The litmus test for the company is rigorous and uniform application of these important recommendations. I hope the Committee will agree to meet in one year’s time to assess the company’s progress in turning these recommendations into practice.”
For any press enquiries please contact
Mark Pyman, Leader, TI(UK)`s Defence programme
T: 07768 773252
Laurence Cockcroft, Chairman, TI(UK)
T: 07980 225219