United Technologies Corporation

Based on public information, there is evidence that the company has published several statements from the former Chairman and CEO Louis R. Chênevert, supporting the ethics and anti-corruption agenda of the company. These statements can be found in the Code of Ethics, the Non-Retaliation Handbook and the Global Ethics and Compliance Factsheet..

Based on public information, there is evidence that the company’s Chief Executive Officer demonstrates a strong personal, external facing commitment to the ethics and anti- corruption agenda of the company. The CEO is on the Steering Committee of the Defense Industry Initiative on Business Ethics and Conduct.

Based on public information, there is no readily available evidence that the Chief Executive Officer demonstrates a strong personal, internal-facing commitment to the ethics and anti- corruption agenda of the company. The CEO spoke about the company’s ethical culture at the 2008 Executive Conference, but this is outside the two-year timeframe of this question. The CEO also sets annual ethics objectives, which are cascaded to others in leadership positions. However, TI has found no further evidence of a personal commitment from the CEO to ensure the company’s ethics and anti-corruption agenda is actively promoted throughout the company.

Based on public information, there is evidence that the company publishes a statement of values representing high business standards including responsibility. The company’s ethical behaviour is built on trust, respect and integrity. The company describes integrity as uncompromising adherence to the Code of Ethics, reflected through honesty and accountability, and explains the importance of open communication within the company and with stakeholders.

Based on public information, there is evidence that the company is a signatory of DII and a member of IFBEC.

Based on public information, there is evidence that the company has appointed the Audit Committee with overall corporate responsibility its ethics and anti-corruption agenda. The Committee’s duties include evaluating processes to assure compliance with the company’s policies and procedures, Code of Ethics and applicable laws and regulations.

Based on public information, there is evidence that the company has appointed the Vice President, Global Compliance, with responsibility for implementing its ethics and anti- corruption agenda. The Vice President, Global Compliance is identified as Kevin J. O’Connor.

Based on public information, there is evidence that the Audit Committee monitors and reviews the performance of the company’s ethics and anti-corruption agenda. The scope of the review is continuous monitoring of the processes to ensure compliance, rather than a major periodic review of the entire programme. The company therefore scores 1. To score higher the company would need to provide evidence of a periodic, heavyweight review of the ethics and anti-corruption agenda, which takes place at least annually.

Based on public information, there is no readily available evidence of a formal, clear, written plan in place on which the review of the ethics and anti-corruption agenda by the Board is based, or evidence of improvement plans being implemented when issues are identified.

Based on public information, there is some evidence that via the Ombudsman Program the company updates policies in response to identified concerns. However, there is a lack of information regarding the formal process of review and update of the company’s policies in response to actual or alleged cases of corruption. The company therefore scores 1.

Based on public information, there is evidence that the company has a formal anti- corruption risk assessment procedure, implemented enterprise-wide. The company identifies compliance risks, such as bribery, and takes steps to monitor and manage them. The company therefore scores 1. To score higher the company would need to provide evidence on how the procedure is applied, who is responsible for mitigation plans and when they must be applied.

Based on public information, there is no readily available evidence that the company has a formal anti-corruption risk assessment procedure for assessing proposed business decisions, with clear requirements on the circumstances under which such a procedure should be applied.

Based on public information, there is evidence that the company conducts due diligence on business partners, including sales representatives. The company therefore scores 1. To score higher the company would need to provide evidence that it refreshes the due diligence at least every three years and/or when there is a significant change in the business relationship.

Based on public information, there is evidence that the company has contractual rights and formal processes for the behaviour, monitoring, control and audit of agents with respect to countering corruption. Business partners, including sales representatives, must comply with the company’s policy on improper payments. The company can ensure compliance via contractual prohibitions and auditing and oversight rights.

Based on public information, there is evidence that the company makes clear to contractors, sub-contractors and suppliers, through policy and contractual terms, its stance on bribery and corruption and the consequences of beaches to this stance. The Standard Terms and Conditions of Purchase indicate that suppliers must adopt a code of conduct that prohibits engagement in corrupt practices, and the company has the right to terminate the agreement if the supplier fails to comply with any obligation.

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. TI notes that the company prohibits bribery, facilitation payments and kickbacks.

Based on public information, the company has a zero tolerance policy of corruption.

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. Multiple policies are available to download online, including the Code of Ethics which is available in 34 different 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. The policies are written in comprehensible language without dense, legal terms.

Based on public information, there is evidence that the company’s Code of Ethics explicitly applies to all employees and Board members.

Based on public information, there is evidence that the company has a policy on potential conflicts of interest, which applies to both employees and Board members. The policy contains a definition of a conflict of interest and provides numerous examples.

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 and not a subterfuge for bribery. Gifts are acceptable if they are of a reasonable value and frequency, and not intended in exchange for favourable treatment. There are also clear upper limits for both giving and receipt of gifts.

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 and not a subterfuge for bribery. As the company’s definition of a business gift includes hospitality, evidence suggests that regulations for gifts are also applicable to hospitality. There is also evidence of clear upper limits that apply both to giving and receiving of hospitality.

Based on public information, there is evidence that the company has a policy that explicitly prohibits facilitation payments. The company therefore scores 1. To score higher the company would need to provide guidance on how this policy is implemented in practice, for example when facilitation payments are made in response to a threat of physical harm.

Based on public information, there is evidence that the company regulates political contributions in order to prevent corruption or other undue influence. The company does not provide political contributions to officials, political parties, and candidates outside the USA. In the USA the company makes political contributions to state and local candidates in accordance with applicable laws and regulations. All political contributions must receive prior approval from the Senior Vice President, Government Affairs and the Senior Vice President and General Counsel. The Public Issues Review Committee of the Board of Directors is required to review and monitor the company’s governmental relations activities. The company lists recipients of political contributions from 2009 on its website.

Based on public information, there is evidence that the company has a clear policy on engagement in lobbying activities, in order to prevent undue influence or other corrupt intent. Lobbying is managed by the company’s Office of Global Government Relations. The Senior Vice President, Government Affairs oversees the activities of Corporate Office personnel and operating unit representatives. The Public Issues Review Committee of the Board of Directors is required to review and monitor the company’s governmental relations activities. The company states that its federal lobbying activities can be reviewed via its U.S. Federal Lobbying Disclosure Act filings, and state lobbying activities are subject to regulation and reporting in virtually every jurisdiction in which the company operates.

Based on public information, there is evidence that the company regulates charitable contributions, in order to prevent undue influence or other corrupt intent. Charitable contributions are prohibited if the purpose is to obtain or retain business or to secure any improper advantage. Operating unit charitable contributions must be reviewed in advance in accordance with Corporate Policy Manual Section 11, and the Public Issues Review Committee is responsible for reviewing all charitable contributions. The Code of Ethics refers to a ‘Charitable and Philanthropic Contributions’ policy however this policy does not appear to be publicly available on the internet. The company therefore scores 1. To score higher the company would need to provide evidence that the recipients of charitable contributions are publically declared.

Based on public information, there is 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 Code of Ethics provides a number of questions and answers, and the Non-Retaliation Handbook contains an extensive list of frequently asked questions.

Based on public information, there is evidence that the company has a mandatory training programme on its ethics and compliance systems, which includes an anti-corruption policy. The company therefore scores 1. To score higher the company would need to provide evidence of a specific anti-corruption training module.

Based on public information, there is evidence that the company provides training on its ethics and compliance system, which includes an anti-corruption policy, to all employees worldwide.

Based on public information, there is no readily available evidence that the company provides targeted anti-corruption training to Board members.

Based on public information, there is evidence that the company has a varied ethics and anti-corruption training programme. The company states that ethics and compliance training modules are customised to specific regional issues that employees face. The company therefore scores 1. To score higher the company would need to provide evidence that their ethics and anti-corruption training programme is tailored for employees facing different levels of risk.

Based on public information, there is evidence that the company requires disclosure of actual and potential conflicts of interest and advises employees to address any questions to the Business Practices Office. Executive officers must disclose potential conflicts of interest to the Corporate Secretary, who reviews disclosures with the Vice President, Global Compliance. The company therefore scores 1. To score higher the company would need to provide evidence that conflicts of interest are required to be reported in writing or to an independent department.

Based on public information, there is evidence that the company has an explicit commitment to apply disciplinary procedures to employees, Directors and Board members who fail to comply with the Code of Ethics. The company’s anti-corruption policy is contained within the Code of Ethics.

Based on public information, there is evidence that the company has multiple, well- publicised, secure channels, for employees to report concerns or instances of suspected corrupt activity. These channels include the Legal Department, Human Resources and a Business Practices Officer. In particular, employees can report anonymously using the Ombudsman and DIALOG Programme. However, the Ombudsman and DIALOG Programme Coordinators are company employees, despite operating separately from management. The company therefore scores 1. To score higher the company would need to provide evidence that employees are able to report instances of suspected corrupt activity, to independent and external reporting channels.

Based on public information, there is evidence that across geographies, all employees have access to more than one reporting channel. These channels include the Legal Department, Human Resources and a Business Practices Officer. In particular, employees can report to the Ombudsman and DIALOG Programme online or by telephone worldwide.

Based on public information, there is evidence that the company has formal and comprehensive mechanisms to assure itself that whistleblowing is not deterred, and that whistleblowers are treated supportively. The company monitors the usage statistics of the Ombudsman and DIALOG Programme, and evidence suggests that requests made using the Programme have led to changes in the company. Also, the company has follow up interviews with whistleblowers, to ensure they are not receiving any unfair treatment.

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 the Legal Department, Human Resources, a Business Practices Officer, and the Ombudsman and DIALOG Programme.

Based on public information, there is evidence that the company has a non-retaliation policy for bona fide reporting of corruption, and that disciplinary measures are applied to employees who breach this policy. In particular, the company has issued a Non-Retaliation Handbook that provides extensive information and advice on non-retaliation.