Code Corner
Reporting Ethical Concerns

Question:
I just became aware that one of my colleagues may be charging ITT Industries for personal items. He has run into some difficulty outside of work and money is really tight for his family. This is really bothering me but I don't want to get him in trouble. What can I do?

Answer:
Report the possible violation. If your concern is accurate, your colleague's behavior jeopardizes not only his career, but yours and your fellow employees. We always try to be discrete in our investigations and if no violations are discovered the matter will be closed with no future repercussions. Investigations prove our ethics program is working. Whether or not a violation is confirmed, all who participate in the investigation learn from the process and become advocates for how seriously ITT Industries is committed to our Code. It is a violation of our Code of Conduct if you do not report violations that you believe may be occurring.

ITT recently had to consider the future of one of our smaller operations because two employees had stolen tens of thousands of dollars in a similar scheme. Several employees appear to have been aware of the behavior but it took a year for one responsible individual to report their concern. That delay could have cost over fifty good people their jobs because of the actions of just two employees.

In many cultures children believe that "telling" or informing about inappropriate behavior is socially unacceptable. As adults we all know better. We know it feels worse when we do not do all that we can to prevent someone from making a bad choice that hurts them or others. We must all show more concern for those who follow our Code of Conduct than for those who choose to violate it. Remember no one commits violations by accident; it is a conscious choice. Those who commit these acts know they are violating policy and hurting others.

Reporting concerns as soon as possible helps everyone involved to resolve any issues with the minimum negative impact, even for those committing the violations. Very few individuals begin their breach of our Code of Conduct with a major violation. Their abuse usually grows over time as they believe they have escaped detection and appropriate response. If we can identify improper behavior quickly we can often deal with it before substantial harm is done to ITT Industries or the employee in question.

As a large corporation we have faced several serious Code of Conduct concerns over our long history. In every case the consequences of those concerns would have been greatly reduced or even eliminated if they had been reported sooner. These issues never get better with age. We all must do our part to make ITT a place where we all continue to feel secure and proud.

Waiting Makes it Worse
With the arrival of the New Year, now is the time to reflect on our actions in 2004 and to begin to make plans on how we can grow and improve in the coming year. Over the holidays, I had some time to think about the progress we have made improving our ethics and compliance program.

Along with the many positive initiatives discussed in last month's column, I have also had the unfortunate opportunity to participate in several cases where employees have committed serious violations of our Code of Corporate Conduct. In many of those cases there was a significant delay in employees reporting their concerns to the appropriate point of contact. As we can see in the answer to the Code Corner question for this month, this only makes things worse.

Our ethics program depends on the active participation of all employees. We can all make sure it continues to improve in 2005 by reporting concerns as soon as possible.

Alan Leibowitz
Director, Corporate Compliance Programs and Security