Regulatory and Legal Compliance Key Elements

Management Commitment:

The unwavering commitment of our management to a strong culture and integrity lies at the foundation of our ethics and compliance program. Our leadership demonstrates its commitment regularly through communications and actions.

Standards and Policies:

Beyond our Standards of Business Conduct, we use a comprehensive set of policies and procedures designed to maintain robust internal controls tied to the company’s functions and operations and key areas of risk.

Oversight and Resources:

We use internal teams that work together to provide the needed oversight and resources to drive our compliance program, including our Office of the Chief Compliance Officer; Compliance Council; Global Corporate Responsibility; Ethics; and Internal Audit.

Risk Assessment:

Our Enterprise Risk Management Council evaluates the risk factors disclosed in our public filings and the strategies to mitigate and address those issues.

Incentives and Discipline:

We publicly recognize employees who do the right thing. We also have effective processes for addressing allegations and administering discipline to those employees who commit misconduct.

Due Diligence:

We devote significant resources to evaluating and carefully selecting third parties with whom we do business as sales representatives, partners, consultants, suppliers or teammates. We clearly communicate our expectations that these third parties must share our commitment to doing business with the highest levels of ethics, integrity, privacy and compliance with applicable laws and regulations.

Review and Audits:

Through employee surveys and our well-established corporate audit program, the Corporate Compliance Council, and other feedback channels, we continuously review and identify areas for potential enhancement of our compliance program.

Anti-Corruption Compliance

Anti-Corruption Compliance

We maintain a zero-tolerance policy with regard to bribery and corrupt business practices. We conduct our business consistent with high ethical standards and in full compliance with all applicable anti-corruption laws.

Our policies prohibit offering or payment of a bribe, directly or indirectly in connection with all business (commercial or government). We also prohibit the acceptance or promise of anything of value from any person or entity as an inducement or reward improperly to perform or fail to perform a function or activity.

  • Management Commitment: From the top of our business, through our ranks of management, our leadership demonstrates a proactive, visible and steadfast commitment to anti-corruption compliance.
  • Risk Assessment: We conduct internal risk assessments and evaluate the strength of our Anti-Corruption Compliance Program against standards provided by government authorities and industry best practices.
  • Employee Engagement: Anti-corruption compliance is the responsibility of all Northrop Grumman personnel and suppliers, and in meeting this responsibility, each employee is expected to:
    • Complete required anti-corruption training.
    • Be aware of the potential for corruption risk factors in the transactions and business relationships they are involved in on Northrop Grumman’s behalf, such as the perception of corruption in a particular country or organization, adverse information concerning the ethical reputation of our trading partners, and other red flags that might arise.
    • Take measures to ensure that all contracts and business records accurately reflect the true nature of each transaction and the relationship of the parties involved.
    • Promptly report any potential or suspected violations, unethical, or illegal activity in accordance with company policies.
Our Program

OUR PROGRAM

Policies and Procedures:

All employees are required to adhere to the clearly articulated requirements of our anti-corruption policy and related procedures, which include controls and guidance for:

  • Risk-based due diligence of third parties.
  • Conflicts of interest.
  • Business courtesies.
  • Offsets.
  • Charitable donations.
  • Political donations and political activity.
  • Corporate memberships.
  • Sponsorship of corporate events.
  • Detection, monitoring and reporting.
  • Anti-corruption training.

Industry Engagement: Northrop Grumman is a long-standing and active member of the Defense Industry Initiative (DII) on Business Ethics and Conduct and the International Forum on Business Ethical Conduct (IFBEC).

2016 Accomplishments

2016 Accomplishments

Anti-corruption compliance remains an essential element of our global business execution model, particularly with respect to third parties seeking to do business with Northrop Grumman. Recent enhancements to our policies and procedures related to our risk-based vetting of suppliers, consultants, sales representatives, teammates and other third parties include:

  • Responsibility for third party due diligence for the enterprise within a highly trained and fully dedicated diligence collection and analysis organization.
  • Responsibility of cross-functional teams to review and approve third-party diligence and relationships.
  • Implementation of an automated diligence management system for greater transparency, collaboration and process efficiency across the company.
Internal Reporting

Internal Reporting

We expect our leadership to exhibit ethical behavior and to anticipate and respond appropriately to employees seeking to report misconduct. To encourage employees to report potential misconduct, we use management training and “train-the-trainer” modules. This preparation fosters a climate of trust where our employees are more likely to report potential misconduct.