Emerson works hard to maintain a culture of ethical conduct and legal compliance. Our Ethics and Compliance Program is a set of policies and practices honed over the past two decades that define ethical conduct for every Emerson employee in interactions with each other, customers, communities, and other stakeholders.
Our company’s leadership team is required to communicate and reinforce our commitment to compliance with applicable laws, rules and regulations, proper handling of proprietary data and information, and accurate financial reporting. Employees are urged to communicate questions or concerns about compliance in whatever way they feel comfortable, including our global whistleblowing system operated by an independent third party.
The Emerson Board of Directors, in conjunction with a senior management committee, oversees the program and has final responsibility for its success. Senior management and the Board of Directors regularly review and update the program to consider if updates are necessary or appropriate. Policies and documents that support Emerson's Ethics and Compliance Program include:
CEO and Senior Financial Officer Code of Ethics
The Emerson Chief Executive and Senior Financial Officers Code of Ethics conveys the roles, responsibilities, and expectations for top corporate officers in exhibiting and promoting integrity and in providing accurate and timely financial reporting.
Code of Conduct Handbook for All Employees
Emerson's Employee Code of Conduct handbook sets forth the elements of our Ethics and Compliance program. The handbook along with our annual all-employee ethics and compliance training cover many topics including:
A complete refresh and redesign of the Emerson ethics handbook for employees will debut in the fall of 2017. The new ethics handbook is being translated to more than 20 languages in addition to English.
The new ethics handbook for employees is being released in parallel with the internal rollout of a new company-wide single set of values designed to help unify management around a common goal and provide a clear road map for all employees on how they are expected to act and behave. The company’s seven core values are: Integrity, Safety and Quality, Support Our People, Customer Focus, Continuous Improvement, Collaboration, and Innovation.
Annual Ethics Training
We reinforce our Ethics and Compliance Program with annual all-employee training to ensure that every employee is aware of and following the requirements of the program. This commitment to training also helps to ensure that every employee is aware of the latest important updates to our governance principles and practices.
These annual training sessions are generally done face-to-face with various levels of management conducting the training, which encourages dialogue that helps Emerson leaders to identify and address emerging questions or issues and demonstrates Emerson’s culture of compliance. We also use the interaction to ensure that every employee understands how to report any ethical concern without apprehension or fear of retaliation. We conduct surveys to measure employees’ understanding of the program. These surveys show a high level of understanding of our Ethics and Compliance Program by our employees throughout the world.
Ethics Hotline and Communication
To facilitate the communication of ethical concerns or questions, we provide email and phone access to an Ethics and Compliance Hotline for our employees globally. Reports to the hotline may be filed anonymously, and we tolerate no form of reprisal against employees for reporting concerns.
Ethics Hotline emails or calls are received by an independent company, which reports the information to a limited number of experienced and specialized Emerson management personnel for investigation and response. The program is audited by internal and external auditors each year and is revised regularly to improve the program. The chairperson of the Audit Committee of the Board of Directors directly receives finance-related hotline reports from the independent hotline provider, and the Committee reviews serious ethics and compliance allegations, and receives a report on the resolution of any such allegations.
Conflict of Interest Evaluation and Reporting
Emerson conducts an annual reporting process to determine whether any potential conflicts of interest exist between the company and any of its Directors, officers or employees. Each year, a questionnaire is administered to all employees in a position to influence and/or receive personal gain at the company’s expense. The questionnaires are available in 21 languages and approximately 39,000 Directors, officers and employees responded. All newly reported responses indicating a potential conflict of interest issue are reported to the Ethics Committee. All such responses are investigated and resolved. The Board of Directors’ Governance and Nominating Committee provides oversight for Emerson’s conflict of interest policies and receives a report annually on the results of the Conflict of Interest Evaluation process.
Emerson articulates its anti-corruption internal control requirements in an Internal Control Questionnaire (“ICQ”). All business units are required to complete the ICQ and to certify on a quarterly basis that their ICQ is accurate and that the business unit has implemented the required internal controls. Emerson audits approximately 50 locations per year to ensure appropriate anti-corruption internal controls are in place. Emerson utilizes a risk assessment model to identify audit targets and all locations that operate in high-risk countries and industries are audited at least once every three years. Emerson also operates an anonymous hotline that employees can use to escalate potential corruption issues, and all hotline allegations are thoroughly investigated.
Emerson includes anti-corruption information in its annual ethics training, which is received by all employees worldwide. The training is modified each year in response to risks identified during the previous year’s audits. Emerson also requires all employees with contact with customers, government officials, third party intermediaries, and suppliers to complete an online anti-corruption training program once every three years. Additional face-to-face and webcast training also is available.
Emerson participates in the U.S. political process through our federal political action committee (PAC), the “Emerson PAC”, our “Missouri PAC”, the Emerson Missouri Responsible Government Fund, and occasionally and as permitted by law, direct Company contributions. Emerson and the Emerson political action committees (PAC) are non-partisan. For more information, visit the Political Contributions page.
Trade Associations and Lobbying
Emerson’s shareholders, employees, and customers are keenly affected by public policies at all levels of government. To protect shareholder value, Emerson maintains a small office in Washington, D.C. to engage with public officials at all levels of government to educate them on our company’s operations, emerging technologies and markets. This office also follows and, when necessary, seeks to influence public policy decisions that impact the company and its shareholders. For more information visit the Trade Associations and Lobbying page.