GKN plc

Based on public information, there is evidence of a statement from the Chair of the Board supporting the ethics and anti-corruption agenda of the company. The Chairman provides an introduction to the governance section of the 2013 Annual Report, in which he states that conducting business ethically is fundamental to the company's values. The company therefore scores 1. To score higher the company would need to provide evidence of two further statements in the last two years from the CEO or Chairman, supporting the ethics and anti-corruption agenda of the company, or one statement from the last two years in which they specifically support the company's anti-corruption programme.

Based on public information, there is no readily available evidence of a strong personal, external facing commitment of the company’s leadership to its ethics and anti-corruption agenda.

Based on public information, there is some evidence that the company's CEO demonstrates a strong personal, internal-facing commitment to the ethics and anti-corruption agenda of the company. The CEO plays an active role supporting the company's anti-bribery and corruption programme face-to-face training sessions. The company therefore scores 1. To score higher the company would need to provide evidence of at least two more examples from the last two years.

Based on public information, there is evidence that the company publishes a statement of values representing high standards of ethical business conduct, including integrity and honesty. These values are described and reinforced in numerous company policies. The company therefore scores 1. To score higher the company would need to provide evidence that it is committed to other values sought by this question.

Based on public information, there is evidence that the company is a member of ADS, which has adopted the ASD Common Industry Standards. The company therefore scores 1. To score higher the company would need to provide evidence that it is a member of a national or international initiative that clearly promotes anti-corruption.

Based on public information, there is evidence that the company has appointed the Audit Committee with overall corporate responsibility for the company’s ethics and anti-corruption agenda. The Terms of Reference for the Audit Committee clearly state that it meets quarterly and monitors the company’s policies and practices concerning business conduct and ethics.

Based on public information, there is evidence that the company has appointed a person at a senior level within the company to have responsibility for implementing the company’s ethics and anti-corruption agenda. All GKN companies must nominate an Executive or group of Executives whose tasks include advising employees on ethical matters, overseeing compliance with company policies, and monitoring and implementing the Ethical Standards Policy. Executives can seek guidance from the nominated executives at GKN Group Headquarters. However, TI is seeking evidence of a senior person taking responsibility for implementing the ethics and anti-corruption agenda, rather than this responsibility being delegated.

Based on public information, there is evidence that the Audit Committee monitors and reviews the company’s policies and practices concerning business conduct and ethics, including whistleblowing. As the Committee meets quarterly, evidence suggests that the review of these policies and practices occurs at these internals. In particular, the Committee conducts an annual review of compliance controls and risk management.

Based on public information, there is no readily available evidence of a formal, written plan on which the review of the ethics and anti-corruption agenda by the Board or senior management is based, or evidence of improvement plans being implemented when issues are identified. The Audit Committee reviews the Group’s policies and practices concerning business conduct and ethics, including whistleblowing, but detailed information about this process is not publically available.

Based on public information, there is no readily available evidence of a formal review process or that policies and practices are updated in response to actual or alleged instances of corruption.

Based on public information, there is evidence that the company has a risk assessment procedure implemented enterprise-wide. Compliance with laws and regulations is an identified risk. Mitigation is via governance policies and procedures, ongoing compliance training and strong oversight. All Group businesses are required to annually review business risks, compliance with statutory and regulatory obligations, and communication of policies which support the GKN Code. The Executive Sub-Committee on Governance and Risk monitors outputs and reports to the Executive Committee, and the Board receives an annual report on risk management from the Audit Committee. The company therefore scores 1. To score higher the company would need to provide further information about compliance risk mitigation.

Based on public information, there is no readily available evidence of a formal anti-corruption risk assessment procedure for assessing proposed business decisions. The company does assess the risk of proposed joint ventures and new products, but there is no evidence to suggest this risk assessment process identifies corruption as a risk.

Based on public information, there is evidence that the company conducts due diligence that minimises corruption when selecting sales agents and consultants. This involves obtaining satisfactory references and making enquiries to business associations. The company therefore scores 1. To score higher the company would need to provide evidence that it refreshes the due diligence at least every 3 years and/or when there is a significant change in the business relationship.

Based on public information, there is evidence that the company has formal procedures and contractual rights in place for agents, with respect to countering corruption. Prior to contracting with an agent the company ensures that an agent has anti-corruption policies and procedures in place. Contracts require the agent to comply with the company’s Ethical Standards Policy or the company can terminate the contract. Financial records must be maintained for all transactions and a written agreement sets out all the terms which must be available for audit. The company also states it monitors and reviews supplier performance to ensure compliance.

Based on public information, there is evidence that the company communicates its ethics and anti-corruption agenda down the supply chain and makes clear the requirement for suppliers to conform to its anti-corruption policies. The Supply Chain Management Policy states that suppliers must acknowledge the company’s Ethical Standards Policy, have anti-corruption policies and practices in place, and not tolerate corruption. The company uses contractual terms to support the implementation of this Policy and reviews supplier performance to ensure compliance.

Based on public information, there is no readily available evidence that the company explicitly addresses the corruption risks associated with offset contracting.

Based on public information, there is no readily available evidence that the company conducts due diligence that minimises corruption risk when selecting its offset partners and offset brokers.

Based on public information, there is evidence that the company has an anti-corruption policy that prohibits corruption in its various forms. This includes the giving or receiving bribes and of making facilitation payments.

Based on public information, there is evidence that the company’s anti-corruption policy is explicitly one of zero tolerance.

Based on public information, there is evidence that the company’s ethics and anti-corruption policies are easily accessible to Board members, employees and third parties on the internet. The company therefore scores 1. To score higher the company would need to provide evidence that policies are available in a range of languages.

Based on public information, there is evidence that the company’s ethics and anti-corruption policies are easily understandable and clear to Board members, employees and third parties.

Based on public information, there is evidence that the Ethical Standards Policy and the GKN Code apply to all employees. The company therefore scores 1. To score higher the company must provide evidence that these policies also apply to Board members.

Based on public information, there is evidence that the company has a policy on conflicts of interest for employees. Contained within the Ethical Standards Policy it contains several brief examples of conflicts of interest, but does not define them. The company therefore scores 1. To score higher the company would need to provide evidence that conflicts of interest are clearly defined to employees. TI notes that directors have a separate conflicts of interest policy.

Based on public information, there is evidence that the company has a policy for the giving and receipt of gifts to ensure that such transactions are bona fide. The company sets clear thresholds necessary for senior authorisation. Gifts between £50 and £250 must not be offered or accepted without the prior approval of an employee’s line manager. Gifts in excess of £250 must not be offered or accepted without the prior approval of the authorised executive of the applicable GKN company. All GKN companies must retain a register of gifts in excess of £50 and gifts of any value that involve public or government officials. The Corporate Hospitality Policy, located in the Ethical Standards Policy, contains a table listing the local currency equivalents of the gift threshold limits.

Based on public information, there is evidence that the company has a policy for the giving and receipt of hospitality to ensure that such transactions are bona fide. The company sets clear thresholds necessary for senior authorisation. Hospitality between £250 and £500 must not be offered or accepted without the prior approval of an employee’s line manager. Hospitality in excess of £500 must not be offered or accepted without the prior approval of the authorised executive of the applicable GKN company. All GKN companies must retain a register of hospitality in excess of £250 and hospitality of any value that involve public or government officials. The Corporate Hospitality Policy, located in the Ethical Standards Policy, contains a table listing the local currency equivalents of the hospitality threshold limits.

Based on public information, there is no readily available evidence that the company has a policy that explicitly prohibits facilitation payments. The Ethical Standards Policy states that facilitation payments should not be made unless they are specifically permitted under local laws or regulations.

Based on public information, there is evidence that the company prohibits political contributions.

Based on public information, there is no readily available evidence that the company has a clear policy on engagement in lobbying activities, in order to prevent undue influence or other corrupt intent.

Based on public information, there is evidence that the company regulates charitable donations in order to prevent undue influence or other corrupt intent. All charitable donations must be made in compliance with applicable laws, not be made to secure an improper business advantage and be made to a properly established charity. The company declares annual charitable donation totals in the company’s annual reports. The company therefore scores 1. To score higher the company would need to provide further information of the internal control process for approving donations and publically declare all recipients.

Based on public information, there is no readily available evidence that the company provides written guidance to help Board members and employees understand and implement the company’s ethics and anti-corruption agenda. The GKN Code, the Ethical Standards Policy and other policies do not contain examples to illustrate particular situations.

Based on public information, there is evidence that the company has an explicit anti-corruption module as part of its ethics and compliance training programme. This takes the form of face-to-face training for management teams and senior market-facing employees, and online training for other employees.

Based on public information, there is evidence that anti-corruption training is provided in all countries where the company operates. All GKN companies must provide training for their employees in regard to the Ethical Standards Policy, which contains the company’s anti-corruption policy.

Based on public information, there is no readily available evidence that the company provides targeted anti-corruption training to Board members. Company directors have attended a number of external training courses, but there is no evidence to suggest these courses included anti-corruption training.

Based on public information, there is limited evidence that the company provides tailored ethics and anti-corruption training for employees in sensitive positions. The company provides face-to-face anti-corruption and bribery training to management teams and senior market-facing employees. The company therefore scores 1. To score higher the company would need to provide evidence that the company provides tailored ethics and anti-corruption training for all employees in high risk positions.

Based on public information, there is evidence that the company has a formal process by which employees declare conflicts of interest. Employees are encouraged to disclose the conflict with a manager or a nominated Executive. Alternatively employees can disclose using the independent freephone facility as stated in the Employee Disclosure Policy. TI understands that disclosures made to the freephone facility go to an independent department.

Based on public information, there is evidence that the company has a commitment to apply disciplinary procedures to employees in the event of a breach of its policies. However, the company does not have an explicit commitment as it uses language such as ‘may,’ rather than ‘will.’ The company therefore scores 1. To score higher the company would need to provide evidence of this explicit commitment and its application to Directors and Board members.

Based on public information, there is evidence that the company has multiple, secure reporting channels, which allow employees to report concerns or instances of suspected corrupt activity. Reporting channels include employees’ managers, the divisional nominated executive or the external freephone facility. In particular the company has an international whistleblowing hotline, which is independently operated and allows anonymous reporting. However, TI notes that the contact details for the external freephone facility or the international whistleblowing hotline are not publically available.

Based on public information, there is evidence that multiple whistleblowing channels are available to all employees in all geographies. Employees may report concerns or suspected corrupt activity to their divisional nominated executive, the external Freephone facility or the international whistleblowing hotline.

Based on public information, there is some evidence that the company has mechanisms to ensure that whistleblowing is encouraged and that whistleblowers are treated supportively. The GKN Code states that procedures must be in place that allow employees to make disclosures in the knowledge that their concerns will be investigated properly and without fear of reprisal. The Employee Disclosure Policy reiterates this and stresses that employees will be informed of the outcome of investigations as soon as possible. The company states that statistics on the volume and general nature of all disclosures to the whistleblowing hotline are reported to the Audit Committee on an annual basis. The company therefore scores 1. To score higher the company would need to illustrate additional evidence of formal mechanisms, such as an employee survey or process for following up with individual whistleblowers, to ensure that reporting is not deterred.

Based on public information, there is evidence that the company has well-publicised resources available to all employees, where help and advice can be sought on corruption-related issues. Resources include employees’ supervisors or managers, their divisional designated executives or the external freephone line.

Based on public information, there is evidence that the company has a commitment to non-retaliation for bona fide reporting of corruption. However, the company only states that breaches of this policy may result in disciplinary action. The company therefore scores 1. To score higher the company must provide evidence indicating that disciplinary measures will be applied to those breaching the non-retaliation policy.