International Forum on
Business Ethical Conduct
and the
Global Principles
Timothy Schultz
Acting Vice President
Ethics and Business Conduct
Vice Chair, IFBEC
June 4, 2014
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The Path to IFBEC
 2004 - 2005
– Preliminary discussions between defense contractors,
enforcement officials, other stakeholders to join in a
common strategy to fight corruption as an industry and
level the playing field in international defense
procurements
– AIA encourages initiative
 2005 - 2007
– Engagement with TI-UK
– Creation of International Coordinating Council of
Aerospace Industry Associations (ICCAIA) Round Table
on Business Ethics
– Europe develops Common Industry Standards (CIS)
Industry collaboration on anti-corruption
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The Path to IFBEC
 2008
– Preliminary discussions held between ASD AntiCorruption task force and AIA Ethics Task Force
 2009
– Drafting and signing of the Global Principles of
Business Ethics for the Aerospace and Defense
Industry
A path forward with agreed upon principles
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Signatory Commitments
 To implement the Global Principles with comprehensive
policies and integrity programs promoting awareness and
compliance through communication and training
 To encourage reporting of concerns by employees relating
to compliance with the Principles and the integrity program
 To sanction non-compliance in appropriate cases
Programs implementing the Principles have teeth
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Zero Tolerance to Corruption
 Compliance with applicable anti-bribery laws
 No things of value to obtain or retain business, gain
improper advantage. Keep appropriate, traceable books
and records
 Internal controls and training to comply with integrity
policies
 Business partners required to comply with integrity policies
 Seek to eliminate facilitation payments even where not
prohibited by law
Strong stance against corrupt practices
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Use of Advisors
 Written policies govern use and payment of agents, consultants,
intermediaries engaged in business development
 Due diligence assessments required for advisors
 Remuneration of advisors must be for legitimate services
rendered and be properly recorded
 Awareness program for advisors concerning integrity policies
and anti-bribery laws
 Written agreements with advisors require compliance with antibribery policies and laws
 Regular reports from advisors on their activities should be
required
Signatories agree to closely govern advisors
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Managing Conflicts of Interest and
Respect for Proprietary Information
 Follow applicable laws, regulations regarding employing
former public officials to properly manage conflicts of
interest. Maintain related policies
 Safeguard proprietary information entrusted to them
according to non-disclosure agreement terms
 Will not solicit or accept third party’s proprietary
information unless agreed upon with owner of the data
 Unauthorized receipt of third party’s proprietary information
will be handled by not disseminating or reviewing it,
destroying or returning it, and the third party owner should
be informed
Level playing field: conflicts, proprietary information
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Global Principles of Business Ethics for the
Aerospace and Defense Industry
 Shared executive level commitment
 Multi-year, sustained effort by Working Group to
achieve alignment and draft Principles
 Journey toward common framework noted differing
points of departure and emphasis
 Process built greater trust and understanding, plus
recognition that the Principles are a starting point not
an endpoint
Principles are a unifying achievement for the industry
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IFBEC is Founded
 IFBEC formed in 2010
 Charter developed
 Governance structure established
• Steering Committee
– Subcommittees
 Engagement with stakeholders
Organizational structure to guide our progress
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IFBEC BEST PRACTICE FORUMS
Berlin
2010
Washington, DC
2011
Madrid
2012
Washington, DC
2013
Brussels
2014
(Nov 6-7)
Sharing to inspire program excellence for members
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International Forum on Business Ethical
Conduct
Pedro Montoya
Senior Vice-President, Group Ethics & Compliance Officer
DII 2014 Best Practices Forum , 4-6 June 2014
Boosting IFBEC for the future:
1.
Foster outreach activities to increase the number of companies, both prime
and subcontractors, that act ethically and in accordance with IFBEC’s Global
Principles.
2.
Enhance governance to become more effective: New working groups and a
new facilitator for IFBEC key topics.
3.
Improve internal communication tools (newsletters, blogs, publication
releases, public commitments, webinars, monitor policy development and
implementation), and IFBEC milestone documents (IFBEC Charter, Global
Principles, Public Accountability Report)
4.
Create and consolidate an external communication strategy to engage key
stakeholders, such as NGOs, national governments, and international
organizations in coordination with the facilitator.
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IFBEC way forward
Settle a long term Engagement Strategy: ethical business as
competitive advantage, recognized by our key stakeholders
Set clear priorities to address risks:
i. Responsible Supply Chain
ii. Compliance risks in Offset Programmes
Position IFBEC as the international leader forum for
business ethics in aerospace and defence
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