In our industry, Terma is a supplier to many major projects and works with a wide array of partners. It is essential that the relationships we build are based on trust and a mutual understanding of a responsible and ethical business. Being upright and trustworthy are assets in a business relationship. We also recognize that even though Denmark is our center, we do business around the world. This means that we are exposed to diverse and sometimes challenging environments. We as a company need to take the proactive approach in ethical business conduct and raise our awareness towards the challenges and dilemmas that we might face.
Related principles and SDGs
UNGC Principles: 10
|Why this matters to society
||Why this matters to Terma
|Corruption is not only illegal; it poses threats to the stability and security of societies, undermines institutions and democracy, hinders societies’ development, and impacts vulnerable communities.
||Operating globally in interaction with a variety of stakeholders, we take an active role in the fight against corrupt practices. Not only because they are illegal, but also because they are detrimental for businesses and communities.
Terma has a zero-tolerance policy regarding corruption and bribery. Our Anti-Corruption Policy as well as other policies within the topic Anti-Corruption & Business Ethics are described in our Employee Code of Conduct and Terma’s Code of Conduct for Suppliers and Service Providers. These policies are applicable to all our employees, in all our operations, as well as to all our Board members. Top level commitment is essential in ensuring dedication, focus, and compliance within anti-corruption. Our work within anti-corruption and related policies is authorized, endorsed, and supported by our Board of Directors and President & CEO.
Participation in corruption is an unacceptable and illegal activity, which tarnishes our brand and destroys future business opportunities, places our employees in both punishable and morally disputable situations, and has a destructive impact on society and the markets it affects. Therefore, Terma strongly dissociates itself from corruption in any form or shape and works hard to ensure that we are not involved in bribery or similar activities. We have pledged to support the 10th Principle of the UNGC; “Businesses should work against corruption in all its forms, including extortion and bribery” and works with SDG target 16.5; “Substantially reduce corruption and bribery in all their forms”. We recognize that corruption is a risk companies are exposed to when operating in an international business market such as the defense and aerospace industry.
Anti-Corruption Compliance Program
Terma’s Anti-Corruption Compliance Program guides our employees and our efforts within anti-corruption, thus ensuring sound and ethical business conduct. It is aligned with the requirements of among others the UK Bribery Act and the U.S. Foreign Corrupt Practices Act.
Corruption comes in many forms and therefore Terma’s Anti-Corruption Compliance Program covers various forms of corruption, such as, but not limited to, bribery, facilitation payments, kickbacks/commissions, extortion, conflict of interest, fraud, and embezzlement.
The program is divided into various steps, among others: tone from the top, procedures, risk assessment, training and communication, monitoring and internal control, due diligence, and disciplinary measures.
Governance, monitoring, and internal control
To ensure transparency and a robust compliance program, regular status on the program, as well as findings derived from internal control and monitoring, are presented to the Executive Management as well as to the Board of Directors. Terma’s Anti-Corruption Compliance Program is implemented and managed by Terma’s Head of CSR & Compliance, who is also part of Terma’s Ethics Committee reporting to the Chairman of Terma’s Board of Directors.
Moreover, Terma’s internal and external whistleblower system, Ethics Line, as well as our internal case management system, Tell us your concerns, help us track, investigate, and respond to bribery and corruption allegations and incidents. Guidelines on appropriate investigation techniques have been developed to ensure quality investigations that are professional, confidential, and secure. Read more about Terma’s Ethics Line here.
The Anti-Corruption Compliance Program is updated annually based on feedback from training sessions, reports received in our case management and whistleblower system, as well as changes in legislation and best practices in the field. Incentives are also looked upon to ensure that they do not inadvertently undermine our anti-corruption efforts and commitment. These updates enable us to close and mitigate possible gaps in the program and strengthen our compliance efforts and compliance culture.
Risk assessment, due diligence, and training
Being based in one of the least corrupt nations globally, we could easily be left blind to a specific risk factor. Therefore, we regularly update our risk assessment on corruption. Working with anti-corruption is a constant process, where improvement and iterations are required. This also allows for solid foundation to build relevant training for both our employees and market consultants, as well as efficient due diligence mechanisms.
Our marketing consultants represent Terma’s interests in various locations all over the world. Having marketing consultants is a key element of our business, as they provide local knowledge and facilitate new business ventures. As such, our marketing consultants perform a legitimate business function. Terma’s marketing consultants are carefully selected, and beyond our own training and due diligence, they all must go through a due diligence process that is carried out by the Ministry of Foreign Affairs of Denmark. Furthermore, all our market consultants have completed online anti-corruption e-learning modules developed by the UN, made available for companies like us, via the UNGC. The selected marketing consultants working for Terma must adhere to the same policies and guidelines as our employees and are subject to local domestic legislation where they operate.
The type and intensity of training our employees receive is based on their risk profile and tailored to the level of corruption risk their job function and position is prone to; whether it is high, medium, or low. As a minimum, all employees receive anti-corruption training, as part of their Employee Code of Conduct training, which is a multilingual e-learning course. Besides covering anti-corruption, it also covers the other topics in the Code and describes Terma’s whistleblower system Ethics Line and internal case management system Tell us your concerns. The training is updated every two years. Employees in medium and high-risk job functions receive additional annual training, such as for instance more detailed anti-corruption e-learning and face-to-face anti-corruption workshop training. All training is monitored and tracked, and feedback is gathered to ensure that the training is updated accordingly in order to always remain relevant and effective.
Moreover, due diligence processes for third parties and suppliers are tailored to the risk profile of the party: high, medium, or law. As a minimum, all contracts with third parties and suppliers include our anti-corruption provisions.
Political Stakeholder Engagement
Operating in the defence, aeropace, and security sector, Terma’s business framework and conditions are shaped and regulated by policy makers, governments, and other authorities in our external business environment. Consequently, it is a prerequisite for our business operations to maintain an ongoing dialogue with political stakeholders.
All our interactions with our external business environment are conducted based on our principles of responsible lobbying. This means that in all engagements, Terma employees must adhere to the highest ethical standards and Terma’s Employee Code of Conduct.
For monitoring purposes, we keep track of our political interactions with senior government officials. This includes meetings, visits at Terma premises, exhibitions, and export promotion delegations. At the EU level, Terma is registered in the EU Transparency Register.
Terma’s involvement in political and public affairs is primarily carried out through our memberships of trade associations and organizations. Currently, Terma is a member of:
- DI (Confederation of Danish Industry)
- FAD (Danish Defence and Securities Association)
- Censec (Centre for Defence Space and Security)
- Naval Team Denmark
- AmCham Denmark
- American Danish Business Forum
- ASD (Aerospace Defence Industries Association of Europe)
- NIDV (The Dutch Security and Defence-Related Industry)
- BSDV (The German Security and Defence Industry)
- NDIA (National Defense Industrial Association)
- Army Aviation Association of America
- NGAUS (National Guard Association)
- Air Traffic Control Association
- CADSI (Canadian Association of Defence and Security Industries)
- FICCI (Federation of Indian Chambers of Commerce and Industries)
For further information, please contact Terma, Market Development.
Terma’s expertise and capabilities are within technological niches. Our products and solutions are integrated in larger solutions in multi-partner projects. Therefore, it is part of our core know-how to collaborate with a variety of partners. Building the right partnerships is essential to see our company progressing, for example gaining access to and developing new markets through partnerships with the local industry. In Europe, Terma is a member of the committee on business ethics within the AeroSpace & Defence Industries Association of Europe (ASD). Our participation focuses on increasing the industry’s objective of countering corruption via joint European harmonization and simplification of ethical guidelines, standards, and principles.
Read more about our industrial cooperation and partnerships here.