Aeronautics Star, March/April 2004, Special Ethics Supplement Page: 1 of 8
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Living our ethics in an era of scandal
By Bob Stevens, President & Chief Operating Officer
reprinted from Lockheed Martin TodayWe all know the stories: A company uses offshore
entities to hide debt and inflate its profits; another firm
destroys incriminating documents during an ongoing
investigation; executives steal millions from a company
through stock fraud and unauthorized loans and bonuses;
another executive sells his company stock based on inside
information; and the list goes on and on with the scandals
as numerous as they are appalling.
Reading and hearing about all of the recent ethical
lapses in Corporate America, one might think that the na-
tion has fallen to a new low - that something in our culture
or our collective psyche has gone awry.
But a quick look back through history reminds us that
unethical behavior is far from a new phenomenon. Even
the ancient Greek philosopher Diogenes, who died in 320
B.C., was said to have roamed the streets of Athens with a
lantern searching for just one honest person.
Since the dawn of civilization, the confluence of
money (or items of value), people and power has always
created opportunities for individuals to act in their own
self-interest at the expense of the larger good.
In the past century alone, we've seen corporate
wrongdoing in every decade, from the deplorable working
onditions in the meat-packing industry in the early 1900s
to the Harding administration's oil-industry scandal known
as the "Teapot Dome" to the steel-pricing controversy
of the 1960s to the securities fraud of Michael Milken in
the 1980s.
Clearly, human nature hasn't changed much over
the millennia and is not likely to change anytime in the
near future. As long as there are opportunities for selfish,
unethical actions, there will be people who choose to
engage in them.
But the operative word is "choose." Nature is not des-
tiny. We can choose to educate ourselves; we can choose
our actions; we can choose to do the right thing. Ethical
conduct is an active, informed choice that must be continu-
ously renewed and reinforced. It doesn't just happen.It is for this reason that Lockheed Martin invests
heavily in ethics awareness, compliance and training. We
believe that the more our employees think about the ethical
hazards and complexities of the workplace, the more likely
they are to make the right decisions when the time comes.
Everyone, regardless of their position or circumstanc-
es, encounters ethical crossroads - points at which we must
decide what's right and what's wrong. Sometimes, the
right path seems clear, such as when the choice is between
lying or telling the truth, stealing or not
stealing, harming someone or avoiding
causing harm.
But sometimes the situation is
more complicated, and the path is not
so clear-cut. There's a famous ethical
dilemma in the well-known play "Les
Miserables" by Victor Hugo in which
the main character, Jean Valjean, on the
verge of starvation, steals a loaf
of bread.
In what is universally regarded as
an unjust sentence, Valjean spends the
next 20 years in prison. Was he right to
steal the bread, since he was starving?
Was he wrong because stealing is steal-
ing and it was against the law? Would
you have stolen the bread?
Every day, both at work and in our Bob Stevens: Ethic
personal lives, we must be prepared to informed choice th
answer difficult questions about right renewed and reinfi
and wrong and to act in accordance
with the law, with our values and wit the highest standards
of ethical conduct.
This is no small task. It requires that we remain alert
to potential violations and that we ask for advice when
we need it. It demands we speak out when we suspect
wrongdoing. And, most importantly, it commits us each to
call upon the best in ourselves, rise above self-interest and
provide for the larger good.al c
at m
forceThe results of our most recent Ethics Survey indicate
that our long-standing effort to make ethical conduct
integral to our culture and the way we work is taking
hold. While the survey results are encouraging, we
still have work to do. For instance, of the 29 percent
of employees (across the corporation) who say they
observed misconduct last year, fewer than half of them
actually reported it. To change this, we must ensure that
all members of management foster an environment where
employees are comfortable reporting
concerns in the workplace.
Occasionally, I hear people say
that ethics in business really do not
matter; that some companies never
seem to suffer any real punishment
for their ethical lapses and may, in
fact, even get rewarded in the form
of rising share prices and new pro-
gram wins. Isn't the old adage true,
they ask, that in business "nice guys
finish last?"
To the contrary, "nice guys" are
the only ones who finish at all! The
long list of companies that have
virtually imploded due to unethical
decisions provides sad testimony to
that fact. Ultimately, everyone affili-
onduct is an active, ated with a company - employees,
ust be continuously customers and shareholders - pays
.
the consequences for the unethical
actions of a few individuals.
I know you join me in aspiring to the high ideals we
have set for ourselves in Lockheed Martin. In this era of
perpetual scandal, I remain proud of our company and
our people, as I hope you are.
I think old Diogenes would be proud, too.LM Aero employees 2003 Ethics Survey responses
Lockheed Martin can pride itself on building ethics and integrity into the very
fabric of the enterprise. This is a compelling business priority, embedded in our common
values as a company that is above board and plays it straight.
Results of the 2003 Ethics Survey show that employees generally feel that
Lockheed Martin has a positive track record in that regard. But the company must
remain vigilant, not get complacent into thinking it couldn't happen here, because that
is when the enterprise will be most vulnerable.
Survey responses show that awareness of ethics and how to report concerns remain
high. Employees also see high levels of corporate commitment to ethical business
conduct. Those who feel the company's commitment is improving see training and com-
munication as the top reasons why.
Those who think this commitment is declining cite such factors as a change in their
manager's commitment or a trust issue with their manager.
At LM Aero, 85 percent of employees never or rarely feel pressure to compromise
ethical standards and 15 percent report such pressure either all the time or periodically(Question 7). The most likely reasons cited for feeling pressure to compromise ethics
are schedule pressures, overly aggressive objectives and pressure from supervisors
(Question 8).
Employees say they have observed lower levels of perceived misconduct than
in previous surveys, yet 16 percent still fear reprisal if they report an ethical concern
(Question 17). That's an improvement over the 19 percent reported in the 2001 survey
and 33 percent in 1999, and this metric could improve even more with management
attention.
Employees say they report misconduct because it is the right thing to do, they see
it as their responsibility or believe action will be taken (Question 11). Reasons cited for
not reporting misconduct include not expecting corrective action to be taken, fear of
retaliation or a lack of trust in the confidentiality of the process (Question 15).
On the following pages are the survey results, based on the responses from
LM Aero employees.F
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Lockheed Martin Astronautics Corporation. Aeronautics Star, March/April 2004, Special Ethics Supplement, periodical, March 2004; United States. (https://texashistory.unt.edu/ark:/67531/metapth1023874/m1/1/: accessed July 16, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu.; crediting Lockheed Martin Aeronautics Company, Fort Worth.