We act with integrity in our working and business relationships. The key basis for this is a Group-wide Code of Conduct that provides all of us with binding guidelines for our behavior in the company, toward our business partners, our customers, and in society. For us, compliance means adherence to these rules and other internal regulations as well as to the law. Our established compliance system still has room for improvement, and so we continuously work to refine it.
For the success of our company and for our collaboration with our stakeholders, compliance is essential. MTU conducts its business as a fair employer, business partner and customer, and advocates transparent competition where all parties are on an equal footing. Integrity and responsible conduct are core values of our corporate culture and are embedded in the MTU Code of Conduct, which is binding for all employees, managers and members of the Executive Board. These Group-wide compliance rules include topics that are important to us, including key compliance issues such as corruption or antitrust law.
Key topics of the Code of Conduct
In addition, each employee must be familiar with and observe the legal requirements relating to their role, the terms of their employment contract and company regulations. Managers have a particular responsibility to uphold these requirements and regulations and to act as role models. We also expect our business partners to fully comply with all applicable laws. A separate Code of Conduct applies for suppliers. → Code of Code of Conduct for Suppliers
The MTU Principles (“We shape the future of aviation”) are an integral part of our corporate culture; they help MTU act in a consistent and reliable manner. As a signatory to the UN Global Compact (UNGC), we are committed to preventing corruption within our company. In the interests of maintaining sustainable corporate leadership, we take our lead from the German Corporate Governance Code and international compliance standards, such as the Good Practice Guidance on Internal Controls, Ethics, and Compliance issued by the Organization for Economic Cooperation and Development (OECD). Our commitment to fighting corruption extends beyond the company as well; besides our status as a UNGC signatory, we are also a member of the AeroSpace and Defence Industries Association of Europe and the TRACE International anti-corruption initiative.
One focus of our compliance activities is the prevention of corruption. MTU condemns corruption of any kind as well as all other forms of white-collar crime. Our long-term success is founded on compliance with legal requirements and our own internal guidelines. In addition to the Group-wide Code of Conduct, MTU guidelines clearly lay out the appropriate way to handle hospitality and gifts. Further internal regulations concerning the prevention of corruption address customer events, donations, sponsoring and the approval process for sales consultants.
Our contribution to the SDGs
“Peace, justice, and strong institutions” is one of the UN’s 17 Sustainable Development Goals (SDGs) for its 2030 Agenda. It calls for a significant decrease in all forms of corruption and bribery. The SDGs are also aimed at companies; with a comprehensive compliance system, we are actively taking steps to combat corruption and bribery, minimize the risk thereof and support fair competition. In this way, we are able to contribute to sustainable development that benefits society as a whole.
Embedding compliance in the organization
MTU has a compliance system for the entire company; it reorganized this system in 2018. As the final decision-making authority, the CEO is responsible for the company’s business ethics and anti-corruption policy. The core functions responsible for ensuring ethical and correct conduct are the existing Compliance Board and a Compliance Officer, named in fall of 2018. New members have been appointed to the board, and together with the Compliance Officer, they will better address potential compliance risks. Both the Compliance Board, which is drawn from the top level of management level, and the Compliance Officer hold Group-wide responsibility. The Compliance Officer’s duties include conducting preventive measures, investigating incidents of white-collar crime, and collaborating closely with the Compliance Board in further developing the compliance system. The Compliance Board holds regular and ad hoc meetings, the latter at the request of the Compliance Officer. The Compliance Officer provides quarterly updates to the Executive Board and the Supervisory Board’s Audit Committee, which for its part informs the plenary meetings of the Supervisory Board. The Supervisory Board’s Audit Committee oversees the Executive Board’s compliance activities.
MTU’s compliance organization
Responsible international trade
Another key compliance topic is observance of international trade law, also known as trade compliance. MTU created a separate organizational unit to address it and instituted requirements for thorough audits. The regulations apply to all the company’s divisions, affiliates and employees worldwide. Customs and export control laws govern which products, services and technical data MTU is permitted to sell, share or provide and to where, to whom and for what purpose. Compliance with the applicable international trade regulations is a binding requirement of the MTU Code of Conduct. To this end, the company has created a central international trade department and harmonized process standards throughout the company. These processes include the review of all documents, software and parts prior to shipping to make sure they are in line with export control regulations or existing authorization requirements. The international trade department has been granted cross-divisional authority to issue certain directions, which extends to the right to stop deliveries. The department head reports directly to the Chief Operating Officer in their capacity as the person in charge of MTU exports.
Data protection and IT security
In the current climate, for example due to the new European General Data Protection Regulation (GDPR), data protection is becoming increasingly important. In our business activities, we take care to provide comprehensive data protection and have established an appropriate management system. We expect all employees to comply with data protection regulations, a claim that is underpinned by our Code of Conduct. MTU has appointed data protection officers or coordinators in all of its Group companies, who are instructed in all relevant regulations. The aim is to achieve uniform data protection and data security standards for the handling of personal data throughout the Group that meet the requirements both of the GDPR and of the national legislation applicable at each location. Reports on data protection are submitted to the Executive Board every month.
MTU has an IT security management system in place and implements appropriate protective measures on a technical and organizational level to ensure its IT systems are stable and secure.
Objectives of the compliance management system
We want to prevent compliance violations and ensure that business decisions are made with integrity. MTU does not tolerate any kind of conduct that violates laws or regulations. Any detected violations will be subject to disciplinary action. In such cases, MTU applies a principle of zero tolerance. In the reporting year, we did not identify or confirm any suspected instances of corruption. And as in previous years, no violations of the Code of Conduct were reported by employees or external stakeholders. No significant fines were levied against the company for breaches of applicable laws, and MTU faced no legal action due to anti-competitive, antitrust or monopoly practices. In addition, no reportable incidents of data protection breaches occurred within the MTU Group in 2018.
Global reporting system
We have set up a global whistleblower system that allows employees and external stakeholders to confidentially report instances of unlawful conduct to an ombudsman. If the report is found to be credible, the ombudsman initiates the investigative steps necessary. The ways we have established for reporting non-compliance are communicated to employees through internal media channels and explained to external stakeholders in writing or on our website. The identity of the whistleblower and the information they impart are treated as strictly confidential—even if the suspicion turns out to be unfounded. We wish to make it clear that whistleblowers acting in good faith shall not be penalized or disadvantaged by the company in any way. In addition, employees can confide in their superiors, the legal department or HR. MTU did not receive any relevant reports in 2018.
In the reporting year, we trained more than 400 employees on compliance matters using e-learning tools alone. Employees in Germany and Poland additionally received face-to-face training.
Training employees on compliance
To ensure a functional compliance culture, MTU puts a high priority on preventing possible forms of misconduct and raising awareness of compliance issues among employees. When new employees are taken on, they are informed about the Code of Conduct and sign a declaration to uphold it. We also present and discuss the Code of Conduct at the introductory event for new employees at all our locations. Furthermore, we hold regular training sessions on the Code of Conduct for selected business units as part of our compliance activities. Raising awareness of compliance issues is done first and foremost by organizing mandatory anti-corruption and compliance training courses for managers at all hierarchical levels and for employees who hold certain positions, such as in sales. In the reporting year, we trained more than 400 employees using e-learning tools alone. Employees at our Hannover, Ludwigsfelde and Rzeszów sites additionally received face-to-face training. The training sessions focused primarily on anti-corruption, international trade and the Code of Conduct. In addition, we continuously inform employees about and raise their awareness of compliance issues, such as data protection, in a way suitable for each target group.
We have put various control mechanisms in place to ensure compliance throughout the company and to minimize risk. The Compliance Officer inspects sales support consulting contracts for possible corruption risks before they are placed or renewed. Potential consultants are also subject to an assessment by an independent provider of due diligence services. The corporate audit department conducts regular compliance audits in which it checks business processes and procedures for conformity to legal requirements and adherence to internal guidelines.
We aim to continuously improve our compliance system and had it reviewed by external independent experts. We are successively implementing the recommended actions that resulted from this review and aligned the compliance system with them in the reporting year. As of 2019, the Compliance Officer will replace the ombudsman as the point of contact for complaints and information and has taken over continued development of the whistleblower system. Also in 2019, we will introduce a web-based reporting system and a standardized reporting system for all Group locations. We will continue to expand and standardize processes and procedures in the area of international trade law as well.
More information about:
MTU in the UN Global Compact
AeroSpace and Defence Industries Association of Europe