How important is ethics to a successful business? An organization that can create and grow a work environment that is firmly rooted in its values inspires confidence and can ensure sustainable growth over the long term. A strong ethics program can instill a contract of trust for employees and clients and ensure the company’s focus remains on what’s important. Ellen M. Martin, director of ethics for The Boeing Company’s Defense, Space & Security business, spoke with executive editor Robert Beaudoin.
How do you define ethics and why is it important?
Ethics is a combination of compliance and integrity. The elements of the Boeing ethics program address compliance monitoring in a way that is proactive so that missteps can be prevented. Within the company, employees have a personal accountability for what they do. Leaders must create an open environment where employees can raise issues without fear of reprisal. Ethics is about standards of conduct which are consistent with values. Every employee in the company realizes that our integrity is on the line with every product we build. They all connect to the value of our products and the importance of doing things the right way.
When and why was your ethics program created?
Ethics is part of everything that we do and is the foundation upon which the company was built. Since the company was created in the early 1900s, our focus has always been on ethics and integrity in everything we do. On the commercial side, with thousands of our aircraft transporting millions of people around the globe, it is critical that they have faith in the integrity of the people who build the aircraft. It is equally important on the defence side, where the lives of the warfighters and national security depend on what we do and how well we do it.
Our commitment to ethics goes right back to the founding days of the company when Bill Boeing ensured that there was always a focus on the ethics and integrity of the work. Today, when new employees are hired, either as direct hires or from acquired companies, they go through an orientation session and other courses and the ethics program is embedded in all of these. Ethics also forms part of many of our functional excellence programs and our leadership programs across the company. We regularly share information about our ethics line, the ethics website; we ensure that people are aware of how to reach their ethics advisors. Within this open culture of sharing, we make it as easy as possible for employees to raise issues and concerns on ethical issues and for leaders to deal more effectively with such issues.
Your program is structured as a code of conduct based on compliance with directives. Is it also focused on changing behaviours?
The Boeing Code of Conduct outlines expected behaviours for all employees, which includes conducting business “fairly, impartially, in an ethical and proper manner, and in full compliance with all laws and regulations.” Our code of conduct, however, is only one element of the ethics program. There are several elements within the program that revolve around supporting a culture of openness and transparency, as well as a number of different methods for reporting situations and concerns. Being proactive, we try to troubleshoot the situations through an integrated analysis format that we can work across all of our functions to resolve the issues. So the ethics program is much more than the code of conduct.
However, we do not attempt to teach ethics. We focus on ensuring that employees across the organization, at all levels and locations, have the same expectations and the same values no matter where in the company they may have come from or the state or country in which they reside. Boeing has those same expectations of all employees – to adhere to our procedures, our code of conduct and to be open to raise issues with the managers or ethics advisors to get the issues resolved.
A compliance-based program is focused on identifying all problems. Since that is almost impossible, how do you address issues that are outside the norm?
It is true that you can never foresee every eventuality. That is why we focus on both compliance and culture. Our focus on culture is all about creating an openness in the company that encourages employees to raise concerns in a safe, non-threatening environment, where managers are open to hearing the concerns so that they can be resolved.
What is the role of the ethics advisor?
The primary role of an ethics advisor is to enable employees and leaders to evaluate issues that are brought to them. While they are not arbiters, they can, if necessary, call on Human Resources when there is an issue between an employee and a leader. They are there to help create the open culture and provide feedback to both employees and leaders.
Without getting into a lot of detail, can you discuss some of the more important ethical issues that you have had to address?
We do a lot of work around issues of conflict of interest and the improper use of company resources. We try to ensure that there is no single issue that becomes the most important – our program is a continuous process where we address those concerns as they come forward and provide training to ensure that employees and leaders are fully aware of the company’s position on these ethical questions. We expect employees to raise concerns about potential conflicts of interest as they arise.
What measures and performance indicators have been developed to determine how you are doing?
We use an employee survey. We also monitor the inquiries that come in through our ethics line to determine what kinds of issues are being reported. We analyze these in an effort to preclude any potential risks. This information is then shared with the highest levels of the company for any necessary review and action.
What happens to employees who fail to comply with the spirit, if not the letter, of the law?
We have very robust processes where the employee conduct is evaluated and a determination is made of the appropriate action to be taken, up to and including termination of employment.
It is perhaps easier to deal with ethical issues when the actions take place in your home country. How do you address issues that arise with respect to how your personnel work in other countries, where the same robust ethical standards do not always apply?
Our corporate ethics, values and standards do not change no matter where or with whom we do business. However, we do respect cultural and behavioural differences. We recognize that cultural norms differ around the world and there are aspects which may differ from those in the U.S. These have been captured in our international annual recommitment training. We ensure that all employees understand that we have one set of values and expectations to which all are expected to conform.
What recommendations would you have for other organizations, whether public or private sector, with respect to developing an ethics program?
Maintain consistent expectations of business conduct; clearly state corporate values and include them as a measurement of individual performance; and ensure senior management commitment and engagement in the program. Ethics must be a topic that all employees talk about on a regular basis. Strive for an open culture such that employees can raise issues without fear of retaliation, and ensure that integrity and ethics are part of the fabric of the company.
SIDEBAR
In 2003, Boeing staff faced allegations of violating not just their own code of ethics but also U.S. law. Making a mistake is not necessarily unethical; rather, it is how the company responds to the mistake that is important. In 2005, John Lockard, then Boeing’s vice president and general manager, stated: “It was a difficult time for us but it also gave us a renewed focus on how to avoid these mistakes in the future. We began a recommitment to the core values of our company – not just talking about ethics and integrity but ensuring a work environment where ethical business conduct and compliance are integral to every aspect of our business.”
An interview with Boeing.