2007 RANKINGS

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SPOTLIGHT ON SELECTED WINNERS

Perry Minnis is the Director of Global Ethics & Compliance for Alcoa, a metals and mining company with over 120,000 employees in 44 countries. Minnis, who started with Alcoa in finance 39 years ago, runs the Global Ethics & Compliance department to track metrics and determine if the company has a positive impact on the community. According to Minnis, “Our management has a very strong focus on safety. Alcoa is considered to be one of the safest corporations in the world.” The company’s Ethics and Compliance Council, which includes the CEO, vice presidents, and department directors, was formed in order to notify all executives of the latest in operations. The Council presents findings to the Board on a quarterly basis.

Minnis told us that Alcoa’s Code of Conduct has been condensed to apply to specific roles and translated into different languages in order to make it an effective tool for all employees. The Code is also provided to suppliers, so they understand Alcoa’s expectations and policies. “If a vendor’s values or policies differ drastically from Alcoa, chances are they won’t be doing business with us,” emphasizes Minnis. He continues, “The most important thing is our values. We have a set of values and policies that is consistent across the company, and we train all employees to adhere to and uphold those values.”

Sandy Cutler, CEO of Eaton Corporation, spoke in great detail about the basic beliefs that make Eaton a value-based company. These core values have allowed Eaton to maintain a strong foundation and sense of stability during recent internal changes and mergers. Rather than approaching ethics as a compliance issue, Cutler believes, “It’s about doing business right through internal philosophies and customer commitments. We’ll lose business before we will compromise our values.”

Eaton employs 61,000 people in 125 countries, and almost all of their products target helping people and companies effectively use energy. For example, Eaton developed a technology with the EPA for UPS, that allowed the shipping company to save 70% in fuel economy. Additionally, Eaton developed a hybrid electric bus technology for possible use during the Beijing Olympics.

Eaton places high value on contributions in the workplace and community, believing they are key components for doing business right. “People will work where the company and the community involvement values reflect their own,” insists Cutler. Every employee at Eaton has the opportunity to raise questions if they believe their personal morals are at risk. If a company is committed to doing business ethically, “you can cut the top off and the bottom would keep working,” maintains Cutler.

When we spoke to Knight Kiplinger about the company his grandfather started, his pride, dedication and passion was obvious. When Kiplinger speaks about the ethical culture of the company, he emphasizes that they “go the extra mile for their clients and their employees.” Founder W.M. Kiplinger, a social liberal and economic conservative of the 1920s, believed in communal capitalism within his company and shared his success with his employees by giving company stock to employees, among other great benefits.

Like many publishers today, Kiplinger is facing tougher times, but believes that “in the more difficult of times, the belt tightening should start at the top rather than at the bottom.” Setting the ethical tone at the top, Kiplinger maintains the idea that “we are all in this together” by freezing executive bonuses instead of cutting jobs. “It’s easy for a company to act generously and ethically during boon times. It’s when difficult times come that you see how a company truly is.”

Maintaining trust with non-employee family shareholders is also of great importance to Kiplinger. “Our company is a model of how to deal ethically with family members that don’t work in the business but have a stake within the business,” says Kiplinger. In the midst of maintaining company stability and sustainability, Kiplinger upholds its responsibility to its readers and will oftentimes reject ads that are of little or no value to its readers.

We spoke with Brackett Denniston, General Counsel for General Electric about creating an ethical culture and maintaining strong compliance programs. Denniston believes “a good company thinks about its human side,” and how people are impacted by business practices. To answer the needs of employees and communities, GE is active in organizations like NAFTA and the National Electrical Manufacturers Association, and is a founder of Transparency International, a global society that fights the impact of corruption on people worldwide. “You have to act like a leader, be a leader, and be aware of the impact of your actions and how they affect hundreds of thousands of people,” says Denniston.

GE dates back to 1892 and carefully considers the social impact of its products and operations on the communities in which it operates. From jet engines to household appliances and financial services to plastics, General Electric is dedicated to converting ideas into leading products to help solve the world’s challenges. Compliance and governance challenges are equally important to GE and remain non-negotiable aspects of operations. “A strong compliance practice begins with the basics of incorporating good citizenship into the company culture,” says Denniston.

When we spoke to Neil Nyberg, VP of Ethics & Compliance and Gary Pilnick, General Counsel for Kellogg’s, they declared,
“W.K. Kellogg believed in doing things the right way and built this company on integrity.” In business for 100 years, Kellogg’s has taken pride in its ethics and compliance program known as “K Values.” According to Pilnick, “It starts with the values, which guide behavior and ethical choices.”

Founder W.K. Kellogg wanted to do good things for people, starting with nutrition and the environment, and began promoting environmentally-friendly processes by producing the first boxes of cereal in recycled packaging in 1906. Today, Kellogg’s uses 100% recycled packaging. In addition, Kellogg’s created a Social Responsibility Committee in 1979 that now deals with environmental concerns, health & safety, addiction and abuse, and other issues that impact employees and communities.

According to Nyberg, culture and diversity truly matter. “We see ourselves as role models. Our commitment to ethics is absolutely non-negotiable.” Kellogg’s recently received an award from the National Association for the Advancement of Colored People for diversity in compliance and ethics. Kellogg’s is also the 2007 national sponsor for Race for the Cure, and has a comprehensive program for United Way’s Days of Caring, in which the entire company donates time. “You can tell in the eyes of the employees that it is a great reminder of what we have and how lucky we are,” says Nyberg.

In business for 170 years, John Deere prides itself on enabling “human flourishing.” With core values of integrity, quality, innovation and commitment, the company provides advanced products and services for agriculture, forestry, construction and landscaping, as well as manufacturing engines for use in heavy equipment. James R. Jenkins, Senior VP and General Counsel for Deere & Company, told us “John Deere fully recognizes the need to conduct business with integrity. Our broad approach to citizenship, coupled with market leadership, helps us improve the world while growing a business.”

Deere believes in creating and distributing service in ways that respect the earth’s limited resources while providing safe and healthy workplaces to help employees develop to their full potential. Deere continually reinforces its commitment to helping find policy solutions that benefit the environment. “We believe that effective policy to address global climate change must include development and support of renewable energy sources including agricultural, forestry, wind and bio-technologies, as well as processing and distribution improvements,” says Jenkins.

With a passionate commitment to doing what is right and operating ethically, John Deere makes their conduct guidelines transparent to employees, customers, and suppliers. Acting out of principled, long-term self-interest, Deere contributes to the greater good by supporting the quality of life in their communities, protecting the environment and preserving precious resources. According to Jenkins, “We believe that exceptional performance will not be sustainable if it is at the expense of our values.”