Ethics and Integrity
At Northrop Grumman, we are guided by our company Values and expect that our decisions and actions demonstrate commitment to long-term benefits for our shareholders, customers, employees, suppliers and the communities we serve.
To promote a culture where leaders create and encourage an open and ethical work climate, foster trust and lead by example. We enable and require employees to act with integrity and in compliance with all ethical and legal responsibilities by providing necessary tools and knowledge. We pledge to conduct ourselves with integrity to support an internal culture of innovation and trust. Our ethical obligations extend to all employees and those who represent the interests of Northrop Grumman anywhere in the world.
We are committed to a values-based ethics program, which goes beyond the minimum standards to create and sustain an open environment and a “speak up” culture that fosters trust, helps employees achieve goals and improves our performance. By making the right decisions based on values, Northrop Grumman employees maximize both individual and company success.
Business conduct officer locations
We currently have a network of more than 140 part–time business conduct officers at Northrop Grumman sites around the world. Northrop Grumman facilities have designated business conduct officers; in the U.S. sites with over 200 employees, global sites with over 50 employees and in new areas of focus.
Business conduct officer locations
ETHICS: OWN IT
We are responsible for knowing the rules and regulations that apply to the work we do and ensuring that we have the appropriate training and guidance to do our jobs with absolute integrity.
All Northrop Grumman employees are responsible for ensuring that we maintain absolute Integrity across the company. Each employee participates in mandatory annual ethics and compliance training. In 2016, we provided training for our Standards of Business Conduct, information security, export compliance, human trafficking awareness and, for U.S. employees, the importance of time and labor charging accuracy. We implemented a centralized deployment and standardized certification process to increase training effectiveness. We adapted U.S. content for international relevancy and translated into German, French, Italian and Dutch.
The interactive format was engaging and feedback from our training survey showed positive responses to continued improvements in the content format and structure.
Our Ethics Vision is to foster a workforce that takes ownership of our ethical culture, operates with integrity and lives our company values.
To support our ethics program, we have a strong network of global business conduct officers at strategic locations. These are full-time employees who have a strong ethical commitment to the company, are approachable and broadly trained in Northrop Grumman policies and procedures.
In 2016, two elements demonstrated our reputation as a top performer in our industry: our “Ethics: Own It, Live It, Lead It” messaging and the refreshed Standards of Business Conduct.
Additionally, some of our lead business conduct officers hold compliance and ethics professional certifications from the Society of Corporate Compliance and Ethics.
In February 2016, more than 30 international business conduct officers, representing 13 countries, came together in London, England for the annual business conduct officer workshop. The event began with a full-day boot camp for new business conduct officers, followed by a two-day session where our executive leaders shared their views on ethics and integrity.
Our business conduct officers had an opportunity to discuss challenges, share best practices and lessons learned, and develop strategic plans for program enhancements.
In April, the ethics organization hosted a similar workshop, for the U.S.-based business conduct officers, in Baltimore, Maryland. More than 100 attendees participated in two days of training, sharing ideas and regional networking. Both events enable our business conduct officers to drive the company’s Ethics and Business Conduct program and work to ensure successful implementation of ethics initiatives.
The newly revised Ethics: Own It, Live It, Lead It quarterly newsletter highlights company policies and procedures and serves as a continuing refresher for ethics awareness and the importance of Quality and Customer Satisfaction.
Our corporate intranet site provides additional resources and guidance to assist with ethical dilemmas and decision-making. A scenario database, based on lessons learned, was added this year to assist the business conduct officer community with keeping content fresh and relevant using reality based situations and solutions.
ETHICS: Live it
We act in line with our Values and Standards of Business Conduct. If we see something that is not in line, we speak up.
We encourage employees to raise concerns or questions to managers or business conduct officers. Our “Speak Up – We’re Listening” OpenLine posters, with contact information for local business conduct officers, are prominently displayed at all Northrop Grumman facilities and serve to reinforce our commitment to Integrity and all the People we serve.
Our Northrop Grumman OpenLine provides an additional resource where employees, business partners, Suppliers and other stakeholders can seek guidance on ethics questions and report suspected violations of laws, regulations and company policy. The toll-free 24/7 number, administered by a third-party service provider, is communicated on brochures, posters, the company intranet and internet sites. Callers may choose to remain anonymous. In addition, an online web-based reporting system is available to employees.
We have dedicated OpenLine numbers at many of our international locations so employees in those countries can speak to a representative in their native language.
We thoroughly investigate and address all allegations in a manner that respects the reporting individual and the trust they have placed with us. In 2016, the ethics organization introduced a new Compliance and Ethics Investigation Team to centralize the ethics investigation process, expand automated metrics, improve tracking and augment training for all investigators.
The team coordinates ethics investigations, spots trends, and tracks and reports aggregated data on issue types and actions taken. Their tracking enables us to develop targeted training and communications for our employees. We highlight quarterly OpenLine metrics in the “Ethics: Own It, Live It, Lead It” newsletter to inform employees of investigation actions and dispositions.
We conducted two-day investigator training sessions in Falls Church, Virginia; Redondo Beach, California; and Dallas, Texas for all Northrop Grumman employees involved in the investigations process.
We reinforce our strict Northrop Grumman non-retaliation policy during the investigation process and case-closure discussions. We have a clear, enforceable policy prohibiting retaliation for good faith reporting, supported by disciplinary measures for employees who breach our policy. The company’s non-retaliation policy, prominently posted online and in brochures, clearly states zero tolerance of direct or indirect retaliation against any individual who reports a concern in good faith. Another way we protect employees is by maintaining necessary confidentiality of personal information during OpenLine investigations.
Our Northrop Grumman OpenLine is a valuable resource where employees, business partners and other stakeholders can seek guidance, ask questions and report suspected violations of company policy, regulations and laws.
Overall, approximately, 36 percent of violations were substantiated, resulting in 91 terminations. Additional actions as a result of investigations included coaching, verbal and written warnings and additional training.
* 2016 inquiries were relatively consistent with 2015. Most inquiries were questions about the acceptance of gifts and gratuities.
** The 6 percent decrease in allegations may reflect increased training and compliance awareness. Time reporting and employee misconduct continue as the highest reported violations, followed by misuse of company resources.
Ethics: Lead It
We encourage open, honest communications and an environment where everyone is included and comfortable challenging one another.
At Northrop Grumman, we believe Leadership is a fundamental value, and we work to build engagement and trust within working teams. Tone at the top begins with our CEO’s annual ethics message in the first quarter and continues throughout the year with timely reminders and compliance awareness.
Ethics staff and the business conduct officers lead, partner with, participate in and support external ethics and compliance organizations for professional development and to learn industry best practices. This effort includes memberships with the Defense Industry Initiative, Ethics and Compliance Initiative, Society of Corporate Compliance and Ethics, Institute of Business Ethics (UK), International Forum on Business Ethical Conduct and Aerospace Industries Association of America.
We use positive reinforcement with our ongoing “Ethics: Own It, Live It, Lead It” award (see at right) for employees who demonstrate integrity and inspire others to do the right thing. In 2016, eight employees received this award and a letter from CEO Wes Bush.