ethics corner

August 2007

Building an Ethical Culture From the Top

By Brian Sears

The NDIA ethics code encourages companies always to aspire to and implement best practices in all dealings with the government and other businesses.

Lockheed Martin Corp. has approached its goal of advancing its ethics program beyond the basics — such as a code of ethics, a hotline, training, and published policies — with the intent to maintain an ethical culture within the company and its workforce.

In the 1990s, following many mergers and acquisitions, the company faced the challenge of integrating myriad cultures from multiple merged entities. Company leaders sought to integrate this diverse set of heritage cultures to form “one company, one team.”

This values-based ethics program underscores three basic values: Do what’s right, respect others and perform with excellence.

Doing what’s right is more than mere compliance with the “letter of the law.” It requires understanding and respecting the “spirit of the law.” Respecting others is fundamental to creating a positive, inclusive, and ethical work environment, where employees are motivated to perform with excellence. The entire ethics program aligns with and reinforces these values.

In addition to integrating these values, the practical program components comport with the U. S. Federal Sentencing Guidelines, which call for standards and procedures to prevent and detect criminal conduct; responsibility at all levels; adequate resources and authority for the program; personnel screening related to program goals; training at all levels; auditing, monitoring, and evaluating program effectiveness; non-retaliatory internal reporting systems; incentives and discipline to promote compliance; and reasonable steps to respond to and prevent future similar offenses once a violation is detected.

These guidelines are essential minimum criteria for any program. Government contractors, however, should aspire to do more than simply satisfy these minimum criteria. Consistent with NDIA’s ethics code for industry, firms should aspire to the highest possible standards of business ethics and conduct, and should embody those standards into their written code of ethics and business conduct. All employees should be trained on their respective responsibilities, encouraged to report code violations to supervisors and through a helpline, and ensured of a corporate no-retaliation policy. Finally, accountability to the public should be a corporate cornerstone.

A company’s culture is greatly affected by the “tone at the top” — the words and actions of its senior leaders. The NDIA code of ethics urges that the chief executive officer ultimately serves as the company’s chief ethics officer — the corporate leader who sets the tone for conduct by every employee. Senior leaders must make it clear to everyone they do business with — customers, suppliers, teaming partners, and others — that the company operates ethically and will cease conducting business with those who don’t. Such actions send a powerful message to all constituencies.

Apart from top leadership emphasis on establishing a pervasive environment of high ethical conduct, myriad other concrete steps can supplement this emphasis. These include developing thought-provoking ethics-related products and services, such as annual, live, supervisor-led awareness training sessions involving real-life situations, and company-wide recognition of exemplary employees presented at annual senior leadership meetings.

Lockheed Martin also has had success with its Arts & Film Festival, awarding prizes to employees who express themselves creatively on the topics of ethics, diversity, and leadership through videos, photographs, posters and poetry. Also worth considering are short video messages, sent via email link, that cover various ethics and diversity topics; compliance training related to employees’ job responsibilities; periodic senior management presentations; periodic intra-company articles covering key ethics cases; and periodic employee surveys to gauge employees’ perceptions with related action plans to address identified issues.

The overwhelming majority of employees want to work for an ethical company in which they take great pride

As underscored in the preamble of the NDIA ethics code, wholly apart from anything else, and certainly no less so than corporate profits, making integrity the centerpiece of the business of any defense contractor should always be a business imperative.

Please email your comments to SErwin@ndia.org

Back To Top