ROLLS-ROYCE GLOBAL CODE OF BUSINESS ETHICS€¦ · · 2007-05-01Chapters include questions and...

ROLLS-ROYCE GLOBAL CODE OF BUSINESS ETHICS

“WHATEVER IS RIGHTLY DONE,HOWEVER HUMBLE,IS NOBLE”SIR HENRY ROYCE

1.0 WORKING TOGETHER 02

1.1 RESPECT FOR INDIVIDUALS 04

1.2 HEALTHY AND SAFE WORKING 06

1.3 FAIR AND JUST OPPORTUNITIES 08AND REWARDS

2.0 CONDUCTING OUR BUSINESS 10

2.1 HONESTY AND INTEGRITY IN 12ALL OUR BUSINESS DEALINGS

2.2 DEALING FAIRLY WITH OUR CUSTOMERS 14

2.3 DEALING FAIRLY WITH OUR SUPPLIERS 16

2.4 DEALING FAIRLY WITH 18OUR BUSINESS PARTNERS

3.0 RUNNING OUR COMPANY 20

3.1 GOOD GOVERNANCE 22

3.2 AVOIDING CONFLICTS OF INTEREST 24

3.3 SAFEGUARDING OUR ASSETS 26

3.4 SUSTAINING OUR REPUTATION 28

4.0 PROTECTING OUR ENVIRONMENT 30

4.1 PROTECTING OUR ENVIRONMENT 32

5.0 WORKING WITHIN OUR COMMUNITIES 34

5.1 WORKING WITHIN OUR COMMUNITIES 36

6.0 APPLYING THIS CODE 38

6.1 PROMOTING ETHICAL BEHAVIOUR 40

6.2 SEEKING HELP 41

6.3 ROLLS-ROYCE GLOBAL POLICIES 42

6.4 DEALING WITH UNETHICAL BEHAVIOUR 43

Chapters include questions and answers on ethical issues.

Reference numbers in the text refer to the global Rolls-Roycepolicies listed in the chapter Applying This Code.

CONTENTS FOREWORDWE IN ROLLS-ROYCE SEEK TO BE RESPECTEDGLOBALLY AS ONE OF THE WORLD’S LEADINGSUPPLIERS OF PRODUCTS AND SERVICES FOR THECIVIL AND DEFENCE AEROSPACE,MARINE ANDENERGY MARKETS.

Our goal is to be trusted by our customers,investorsand communities to deliver excellence through the commitment of our employees,partners andsuppliers.

We will only achieve this goal and sustain thisreputation in the long term if we act in accordancewith our corporate values of Integrity,Reliability and Innovation.

We must live up to the high ethical standards wehave set ourselves and act according to laws andregulations wherever we operate.This Global Codeof Business Ethics is our commitment to act in this way in all our business dealings.It expresses ourvalues upon which our success and our future as a business depend.

The Code provides a summary of the principles we must abide by to preserve and enhance thereputation of Rolls-Royce.It applies to all of us inRolls-Royce.Our managers have the additionalresponsibility to create the climate and opportunityfor all employees to ‘do the right thing’and to voice genuinely held concerns without fear ofvictimisation.

We shall not tolerate victimisation and the Codeshows where employees may find advice,information and support.

We are proud of our long history of responsiblebusiness conduct by our employees across all ourbusinesses.

Simon Robertson Sir John RoseChairman Chief Executive

GLOBAL CODE OFBUSINESS ETHICS

1 Rolls-Royce Global Code of Business Ethics

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1.0AS EMPLOYEES,WE WISH TO HAVE AWORKPLACE WHERE WE FEEL RESPECTED,FULFILLED AND APPRECIATED.

ROLLS-ROYCE ASPIRES TO BE ANATTRACTIVE EMPLOYER BY CREATINGAND MAINTAINING A POSITIVE,RESPONSIBLE AND FAIR WORKINGENVIRONMENT.

AS A COMPANY,WE MUST COMPLY WITHEMPLOYMENT LEGISLATION WHEREVERWE OPERATE.

1.0

WORKING TOGETHER

2 Rolls-Royce Global Code of Business Ethics 3 Rolls-Royce Global Code of Business Ethics

Q:Members of my team make jokes about myracial background.If I object,they say I ambeing over-sensitive.Should I just ignore it?

A:No.Your first step should be to talk to yourmanager about it.All managers are responsiblefor dealing with harassment and all allegationswill be taken seriously and investigated.However, if you feel your case has not beentreated properly,you should raise the matter withyour HR department.You also have the option to use the confidential reporting line as describedin Chapter 6: Applying This Code.

Q:As a manager,I am putting my team under a lot of pressure to meet targets.Surely I am right to leave them in no doubt if theirperformance needs to improve?

A:It is part of your responsibility to set challengingtargets and to seek to improve your team’sperformance.However, remember that Rolls-Royce does not support a bullying style ofmanagement,and you should try to analyse anddeal with all the factors that may be hinderingyour team.There are company courses that candevelop your skills in this area.See Chapter 6:Applying This Code, for sources of help.

RESPECT FOR INDIVIDUALSSECTION1.1

WORKINGTOGETHER


We treat each other openly,honestly,courteously and do not tolerate harassmentunder any circumstances.Harassment takesmany forms,including physical,verbal and non-verbal conduct that is unwanted byindividuals,violates their dignity or creates an intimidating,humiliating or offensiveenvironment1.

We respect the personal privacy of ouremployees and we only collect and processpersonal data that is necessary to meet ouroperational needs or to comply with legalrequirements8.

We believe that the decision on whether or not to join a Trade Union is a matter for theindividual.We observe the processes availablein each country regarding collectiverepresentation.

We seek to engage and involve employees inthe development of the business and to fostereffective communication with employees andtheir representatives on business and workissues.We have introduced a Global Councilcovering all employees in the company.TheCouncil provides information and enablesconsultation on company-wide mattersaffecting the entire business and its employees.

We operate procedures that strive to resolvedisputes fairly.

We do not tolerate any form of forced or child labour7.

RESPECT FOR INDIVIDUALSSECTION1.1

WORKINGTOGETHER


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Q:I suspect that safety procedures arepotentially being compromised in the area in which I work.What should I do?

A:Safety procedures must never be compromised.If you feel unable to speak to your supervisorabout this,speak to the next level ofmanagement or someone from the Health,Safety and Environment department. If you wish,you may also raise this through your employeerepresentative.Other sources of advice are listed in Chapter 6: Applying This Code.As acompany,we will not tolerate the victimisation of employees who raise genuine safety concerns.

Q:I am very overstretched at work and notcoping.Where can I get help?

A:You can obtain support from OccupationalHealth or your HR representative.You may alsofind it helpful to read the Rolls-Royce guidancedocument ‘Seven Workstyle Maxims’,availablefrom Occupational Health or online on the InfoCentre,Occupational Health: Information on Stress section.

HEALTHY AND SAFE WORKINGSECTION1.2

WORKINGTOGETHER


We make proper provision for the health,safety and welfare of our employees,visitors,contractors and others who may be affected by our activities at work.All of us have aresponsibility to follow the company’s healthand safety policies2 and must report anyaccident,injury,safety violation,or near-miss to the responsible manager.

We aim to have zero injuries and environmentalincidents and seek continual improvement by implementing the Rolls-Royce Health,Safety & Environment Management System2

and related standards.

We provide a preventative OccupationalHealth service that focuses on how ouremployees’health can affect their work andhow their work can affect their health3.

We recognise that the abuse of alcohol,drugs,solvents,over-the-counter medication andother substances can jeopardise the health and safety of our employees.We treat any suchabuse at work as serious misconduct4.

We promote and safeguard the health andcomfort of all employees by not smoking inany of our buildings and encouraging ourvisitors to do likewise5.

We are committed to maintaining a secureworking environment and we prohibit ouremployees from bringing any weapons ordangerous devices of any kind onto companyproperty.

HEALTHY AND SAFE WORKINGSECTION1.2

WORKINGTOGETHER


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Q:A female member of my team has childrenand I feel that her responsibilities as a mothermust be compromising her job performance.I am considering candidates for a more seniorposition; can I take this into account?

A:All employment-related decisions must be basedentirely on merit and the individual circumstancesof the job.Decisions based on assumptions in themanner described constitute discrimination.

Q:I am worried that my medical condition couldaffect my prospects at work,if it becameknown.What should I do?

A:Talk in confidence to your manager or one of the other sources of advice described in Chapter 6: Applying This Code.Employers must not unlawfully discriminate against people withdisabilities or treat them less favourably,and it isour policy to make reasonable modifications to working conditions to overcome difficultiesencountered.

FAIR AND JUST OPPORTUNITIES AND REWARDS

SECTION1.3

WORKINGTOGETHER


We gain competitive advantage by attracting,retaining and developing the best talent from the broadest range of people worldwide.We are committed to the promotion of diversityand equality and to sustaining an environmentfree from discrimination,where employeesare regarded with dignity and treatedequitably on the basis of their capability and contribution.Discriminatory behaviours and practices undermine people’s skills andpotential and are unacceptable to us1.

We invest in training,education anddevelopment to improve the capability of the business and the skills of our employees6.

Our remuneration policy seeks to reward our employees fairly and takes account ofindividual contributions to the performanceof the businesses in which they work.

We encourage our employees to becomeinvestors in the company.

FAIR AND JUST OPPORTUNITIES AND REWARDS

SECTION1.3

WORKINGTOGETHER



2.0OUR REPUTATION DEPENDS NOT ONLYON THE HIGH QUALITY,INNOVATION AND TIMELY AVAILABILITY OF OURPRODUCTS AND SERVICES BUT ALSO ON OUR CUSTOMERS’CONFIDENCE INOUR PROFESSIONAL INTEGRITY.

OUR SUCCESS IS ALSO INCREASINGLYTIED TO THE PERFORMANCE ANDREPUTATION OF OUR SUPPLIERS.

WE SEEK CONSTANTLY TO STRENGTHENOUR RELATIONSHIPS IN THE SUPPLYCHAIN BY CONDUCTING OUR BUSINESSIN A WAY THAT IS MUTUALLY BENEFICIALAND COMPETITIVE.

2.0

CONDUCTING OUR BUSINESS


Q:A colleague has proposed that we give a non-cash,in-kind benefit to a governmentofficial. I am told that this is common practicein the country concerned.Is this permissible?

A:No.These benefits are viewed in the same way as cash payments.Even common business gifts and courtesies may be unlawful whenprovided to government officials or managers ofgovernment-owned businesses.Local customprovides no protection or legitimacy. In thesecircumstances,you should always seek advicebeforehand on applicable laws and regulations.

Q:Where can I receive advice on gifts orhospitality?

A:If in doubt,always ask your manager and, ifnecessary,one of the sources of advice listed inChapter 6: Applying This Code.

HONESTY AND INTEGRITY IN ALL OUR BUSINESS DEALINGS

SECTION2.1



We are committed to fair competition andhonest,straightforward business dealings.We abide by antitrust and competition laws,for example those that prohibit price fixingand boycotting of suppliers or customers,the fixing of market share,misrepresenting a competitor,or stealing trade secrets9.

We do not offer nor accept any bribe.Wedecline to accept gifts of significant value andwill accept modest gifts only on the specialoccasions when it is customary to exchangeitems of low value.In addition,we avoid anysituation that makes it appear that we haveaccepted a favour from outside Rolls-Royce inthe context of our work.We must not offer orreceive a gift of money,in any circumstances.

We offer or accept hospitality only when it can be regarded as a normal business courtesy.We avoid hospitality that is lavish or when itmight be reasonably regarded as a personalreward for the recipient,or when it cannot bereciprocated.

We observe import and export laws andregulations and obtain proper authorisation for the import and export of products andtechnology10.

When we appoint and use advisers torepresent our interests,their professionalism,integrity and ethical standards demonstrablymeet the requirements of this Code.Wemanage them strictly in accordance withcompany policy11.

HONESTY AND INTEGRITY IN ALL OUR BUSINESS DEALINGS

SECTION2.1




Q:I have a technical worry that might havesafety implications for the product,but it istoo early to be sure.What should I do?

A:If you have concerns about safety you shouldalways raise them with your manager,so thatappropriate specialists have an opportunity toanalyse the risk.

DEALING FAIRLY WITH OUR CUSTOMERS

SECTION2.2



We apply our expertise in technical innovationto our products and services for the benefit of our customers,in order to bring them newmarket opportunities,good value and highquality products which are reliable and safe.

We communicate honestly and openly withour customers,seeking a full understanding of their requirements and meeting ourcommitments to them.

We respect the confidentiality of informationfrom our customers to which we have access.

DEALING FAIRLY WITH OUR CUSTOMERS

SECTION2.2




Q:Does this Code allow me to stay in a supplier’sguest house when on a company visit?

A:Yes, if this is a facility the supplier offers to all itscustomers.

Q:Can I let the suppliers make my hotelarrangements when I visit?

A:Yes,as long as you pay the bills.

Q:One of our suppliers is paying its employeesbelow the local legal minimum pay rates.What is the Rolls-Royce position on this?

A:We are committed to ensuring that Rolls-Roycecontractual arrangements do not exploit thirdparty employees,and you should raise the matterwith the manager responsible for this contract.

DEALING FAIRLY WITH OUR SUPPLIERS

SECTION2.3



We value all our supplier relationships and we treat all our suppliers with fairness andintegrity,regardless of the value of ourtransaction or the length of our relationship.

We expect our suppliers,their employees and subcontractors to operate to the higheststandards of business integrity in theirrelationship with Rolls-Royce.We wish to work collaboratively with our suppliers toensure proper understanding and compliance with our Supplier Code of Conduct12 and theSupplier,Health,Safety and EnvironmentPolicy13,whose standards correspond with the provisions of this Code.

Our terms of business with suppliers are clear.We respect these terms and always aim tooperate in accordance with them.

We aim to communicate honestly and openlywith our suppliers,seeking a full understandingof their problems,and working with them tofind solutions that satisfy both parties.

We respect the confidentiality of informationfrom our suppliers to which we have access.

DEALING FAIRLY WITH OUR SUPPLIERS

SECTION2.3




Q:I have been assigned by Rolls-Royce to workin a Joint Venture company.Which company’spolicies should I be working to?

A:The policies of the JV company. If you feel thatthey are less rigorous than those laid out in thisCode,you should raise the matter with your JV manager. If this does not resolve the problem,you should discuss it with your Rolls-Roycementor or seek advice from one of the sourceslisted in Chapter 6: Applying This Code.

DEALING FAIRLY WITH OUR BUSINESS PARTNERS

SECTION2.4



When setting up new joint ventures,we offerthis Code as a model for any new entity that isnot controlled by Rolls-Royce.

DEALING FAIRLY WITH OUR BUSINESS PARTNERS

SECTION2.4




3.0OUR SHAREHOLDERS AND OTHERINVESTORS TRUST US TO USE ALL OURASSETS – HUMAN,FINANCIAL,PHYSICALAND INTELLECTUAL – TO MAKE OURBUSINESS GROW AND INCREASE THEVALUE OF THEIR INVESTMENT IN ROLLS-ROYCE.

3.0

RUNNING OUR COMPANY


Q:How do I know which laws apply to myactivity in the part of the world where I work?

A:If you are in any doubt about the application orinterpretation of the law,you should contact theLegal department for advice (see p.41).

Q:What will happen to me where I may havebreached a law in the course of doingbusiness for Rolls-Royce?

A:If you have any concerns or are uncertain aboutyour action,you should seek advice from theLegal department.Criminal penalties may apply,which may be more severe if you fail to reportunlawful activity.

Q:I believe that an employee may be colludingwith a supplier to defraud the company.What should I do?

A:You must report the matter to your manager.However, if you judge that to be difficult orinappropriate, reports may be made through the confidential helpline described in Chapter 6: Applying This Code or directly to the Director of Risk or the Director of Security.Your anonymity will be respected.

GOOD GOVERNANCESECTION3.1

RUNNING OURCOMPANY


We are committed to strict compliance withthe laws and regulations that apply to ourbusiness activities around the world.

Our Board of Directors is committed to thehighest standards of corporate governance in setting the company’s values and standardsand ensuring that its obligations to ourstakeholders are understood and met.

Our Board maintains a rigorous system offinancial,operational and compliance controlsand a robust system of risk management.

We aim to keep all our shareholders informedand to understand their concerns,whateverthe size of their shareholding.

We are committed to maintaining accurate and complete business records including all transactions between the company andoutside individuals and organisations.

We are committed to the prevention anddetection of fraud and will report anysuspicion of fraudulent activity.Fraudulentactivity is a criminal offence14.

GOOD GOVERNANCESECTION3.1

RUNNING OURCOMPANY



Q:My husband works for a company thatsupplies Rolls-Royce with equipment.Sometimes I am responsible for purchasingsupplies from them.What should I do?

A:Explain this to your manager,who will provideguidance or seek advice.

Q:I have often dealt with military customers in the course of supplying Rolls-Royceequipment.One of them has asked me about the possibility of employment by the company after he leaves the military.How should I respond?

A:You should not discuss the details of anyemployment opportunities without first agreeingthe position with HR.There are also conflict ofinterest regulations that must be fully andcarefully observed.Share the facts of the situationwith your manager and the Legal department.

AVOIDING CONFLICTS OF INTEREST

SECTION3.2

RUNNING OURCOMPANY


We avoid any relationship,influence or activitythat might impair,or even appear to impair,our ability to make objective decisions whenperforming our jobs.As employees,we do not:

– Provide services (as an employee,consultant,or otherwise) to a competitor or potentialcompetitor.

– Place business with a firm owned orcontrolled by an employee of Rolls-Royce or his or her family,unless written approvalhas been received beforehand.

– Own,or have a substantial interest in,acompany which is or has the potential to be aRolls-Royce customer,supplier or competitor.

If such a situation arises,or if we are unsure as to whether or not any conflict of interestmay have arisen,we will report it promptly tothe responsible manager and seek advice.

We comply with the laws and regulations thatapply to the actual or potential employmentor engagement of former military and civiliangovernment personnel.

We do not engage in,encourage or facilitateinsider trading.This means that we will not use any non-public information about Rolls-Royce or other companies for buying or selling shares,other securities or financialinstruments for personal gain.Neither will wepass on such information to anyone else15.

AVOIDING CONFLICTS OF INTEREST

SECTION3.2

RUNNING OURCOMPANY



Q:I have invented something in the course of my work with Rolls-Royce which I think isnovel and could benefit the company.Whatshould I do about it?

A:You should discuss it with the IntellectualProperty department,who will advise whether a patent should be applied for.Remember thatprior disclosure of the invention to the outsideworld could result in failure to obtain a patent.

Q:I am a school governor/official and would like to offer some practical help,possiblyincluding the loan of company equipment,to encourage the study of engineering in theschool.Could this be arranged?

A:It is Rolls-Royce policy to support such activitywhere appropriate.However,the prior agreementof the company is needed before any companyequipment is loaned.You should raise the matterwith your HR department who can advise you.

Q:I have been allocated a company laptopcomputer for company use whilst I am out ofthe office.Are there any restrictions on my useof it to access the internet at home and in myown time?

A:The time spent is your own and therefore youmay access the internet using a company laptop.However,accessing illegal,offensive orinappropriate sites remains unacceptable.Also,given that there is a cost to the company arisingfrom use of the laptop,any non-business useshould be of a reasonable duration.

SAFEGUARDING OUR ASSETSSECTION3.3

RUNNING OURCOMPANY


Technology,information and designs are thelifeblood of Rolls-Royce,the means by which we remain competitive and serve the interestsof our shareholders.We keep such companyinformation in the strictest confidence and donot disclose it without proper authorisation16.

Our customers include governments anddefence companies and our projects maytherefore be commercially sensitive and raiseissues of national security.We will not seekunnecessary or unauthorised access tomaterial and,where we have authorisation,we will comply with the relevant securityregulations.

We are each responsible for the proper use ofRolls-Royce and customer property,includingelectronic communication systems,materials,facilities and equipment8.We use andmaintain these assets with care and respect,guarding against waste and abuse.We usethem only for company purposes unless wehave proper authorisation for other use.

We will not tolerate the deliberatedownloading or circulation of illegal,offensive,obscene or inappropriate materials.

SAFEGUARDING OUR ASSETSSECTION3.3

RUNNING OURCOMPANY



Q:What should I do if I get a phone call from a journalist asking questions about thecompany’s position on a particular issue?

A:Unless you have been specifically cleared todiscuss the issue,you should politely refer thejournalist to the Corporate Communicationsdepartment.

Q:What should I do if one of my customers orsuppliers wants to use the Rolls-Royce logo?

A:The Rolls-Royce logo is a valuable strategic asset for the company.There are specific brandguidelines and all such requests should beaddressed to the Corporate Communicationsdepartment.

SUSTAINING OUR REPUTATIONSECTION3.4

RUNNING OURCOMPANY


Our reputation is a key asset and we mustbehave at all times in a manner that reflects well on the company.Integrity,Reliability andInnovation are the core values of our company.We enhance our reputation by being seen bythe world at large as living up to these valuesand abiding by all the provisions of this Code.

We deal straightforwardly with the media andensure that nothing is said that is intentionallyinaccurate or misleading.

We are proud of the Rolls-Royce brand and we ensure that association with unauthorisedactivities does not devalue it.

SUSTAINING OUR REPUTATIONSECTION3.4

RUNNING OURCOMPANY



4.0OUR VISION IS TO BE KNOWN FOR THEEXCELLENCE OF OUR HEALTH,SAFETYAND ENVIRONMENTAL PERFORMANCE.WE HAVE DEVELOPED A STRATEGY WITH THE OBJECTIVE OF DELIVERINGWORLD-CLASS PERFORMANCE LEVELS.(SEE ALSO CHAPTER 1.2 ON HEALTHYAND SAFE WORKING).

4.0

PROTECTING OURENVIRONMENT


Q:What do I do if I believe that the business inwhich I am working is in breach of nationalenvironmental legislation?

A:As a company we are committed to obeying the law.You should raise the matter with yourmanager or the Director,Health,Safety and theEnvironment.

Q:I am sometimes asked what Rolls-Royce isdoing to reduce the environmental impact ofaircraft.How do I answer?

A:If it is a question from a friend or family member,you can refer to the priority we are giving toinvesting in research and technology which is directed at improving the environmentalperformance of our products.We are alsodeveloping low carbon technologies, includingalternative energy sources.You can seek moredetailed guidance from the Health,Safety &Environment department or at:http://www.infocentre.rolls-royce.com/environment. If,however,you receive a formalenquiry from the media,you should refer it to the Corporate Communications department.

PROTECTING OUR ENVIRONMENTSECTION4.1



We care for the environment through ourcommitment to the good practice describedin the Rolls-Royce Health,Safety & EnvironmentManagement System2.

We are committed to improving the efficiencyand environmental performance of ourproducts and to achieve this,we investsignificant sums in research into newtechnologies and the development ofimproved products.We aim to reduce theenvironmental impact of the whole life cycleof our products,including raw materialextraction,manufacturing,assembly,testing,in-service maintenance and final disposal.We work with others in the industries in whichwe operate to address sustainability issues.

We seek continual improvement in all ouroperations by implementing our Health,Safety & Environment Management System2

and related standards.All new activities areassessed for their environmental impact andtheir health and safety implications.We pursueimprovement targets in such areas as energyand waste reduction,and recycling.Ourreporting on Health,Safety & Environmentmatters,including our progress againstdeclared targets,is independently assured andwe provide public reports on an annual basis.

PROTECTING OUR ENVIRONMENTSECTION4.1




5.0WE HAVE A FIRM AND LONG-STANDINGCOMMITMENT TO THE COMMUNITIES IN WHICH WE LIVE AND WORK.

OUR DUTY OF CARE TO OUR NEIGHBOURSIS LINKED TO OUR OPERATIONALBUSINESS OBJECTIVES AND IS ANINTEGRAL PART OF OUR APPROACH TOCORPORATE RESPONSIBILITY.

5.0

WORKING WITHINOUR COMMUNITIES


Q:What if complying with this company codebreaks local law?

A:You must always comply with local law.If you are concerned about any conflict,speak to your manager or seek advice from the Legaldepartment.

Q:Will the company support me in working for voluntary organisations such as schoolcommittees or community groups?

A:Yes.However,company time or resources mustonly be used after permission has been granted.

Q:As a Rolls-Royce employee,may I stand forpolitical office?

A:Yes,providing you are not using the Rolls-Roycename,time or resources,or attributing your viewsto the company.Any activity during companytime must be properly authorised.

Q:If a member of the community approachesme with a complaint,what should I do?

A:Always treat it politely and seriously and reportthe complaint to your manager,who will take therequired action or seek further guidance.

WORKING WITHIN OUR COMMUNITIESSECTION5.1



We respect the traditions and cultures of eachcountry in which we operate and seek to begood corporate citizens.

We actively encourage our businesses andindividual employees to support localcommunities in the areas in which we operate,particularly in education,the arts,theenvironment and community development.

We listen carefully to any communitycomplaints and meet with local representativesto understand their concerns.We makecontinual efforts to seek to address andremove these concerns.

Charitable donations are an integral part of our community involvement.We direct thissupport primarily to causes with educational,engineering and scientific objectives,as well as to social objectives connected with ourbusiness and place in the wider community

We do not,as a company,participate in partypolitics or make political donations.We may,however,support our employees if they wishto become involved in civic affairs.

WORKING WITHIN OUR COMMUNITIESSECTION5.1





6.0

6.0THE CHAIRMAN AND THE CHIEFEXECUTIVE HAVE WRITTEN THEFOREWORD TO THIS CODE.THE BOARDOF THE COMPANY IS FULLY COMMITTEDTO THE IMPLEMENTATION OF THE CODE,TO PROVIDING FULL SUPPORT TO ALL EMPLOYEES IN UPHOLDING ITSPRINCIPLES AND TO DEALING WITH ANY UNETHICAL BEHAVIOUR.

APPLYING THIS CODE

Never hesitate to seek guidance on matters ofethics and business conduct.First,talk to yoursupervisor or manager,if you can.If you don’tfeel comfortable with this,then there are otherpeople in the company who have knowledgeand experience of ethical matters and whocan help you,for example:

Communication Your Communications department

Community The Head ofRelations Community Relations

Finance Your Finance department

Health,Safety Your HS&E Advisor and Environment or the Director,HS&E

HR and employment Your HR department

Legal Your Legal department

Occupational Your Occupational Health Health department

Suspected criminal The Director of Security behaviour andfraudulent activity

SEEKING HELPSECTION6.2

APPLYING THIS CODE


A group of senior executives,comprising the Director of Human Resources,Director of Public Affairs,General Counsel,CompanySecretary,Director of Risk and Director ofSecurity is accountable to the Main Board forkeeping the company’s ethical performanceunder constant review and taking anynecessary action.

Likewise,Rolls-Royce North America has aCorporate Compliance Council,comprisingthe Vice President Security,Vice PresidentHuman Resources,Director Business Assurance,General Counsel and the Ethics Programmanager.The Council meets regularly toreview ethical concerns as well as ethicstraining,reporting and response activities in North America.

Training programmes are being progressivelyprovided for employees throughout Rolls-Royce to increase awareness in theissues covered by this Code.In Rolls-RoyceNorth America,Local Ethics Officers (LEOs)have been appointed who,in addition to their normal jobs,have the training andexperience necessary to provide localguidance and support.Besides offeringadvice,LEOs often work with subject matterexperts to oversee formal investigations into reported unethical behaviour.

PROMOTING ETHICAL BEHAVIOURSECTION6.1

APPLYING THIS CODE



If you think you have seen or experiencedunethical behaviour,you should do somethingabout it.Start by discussing it with yoursupervisor or manager.He or she is responsiblefor taking action to correct anything that may be wrong.However,if you feel unable oruncomfortable using the normal reportingchannels,you may consult one of the othersources of advice listed on p.41 and p.42.If you prefer,you may write to the Rolls-RoyceCompany Secretary.

In addition,Rolls-Royce is progressivelyintroducing an ethics reporting line to enableyou to talk in confidence to someone outsideyour immediate business unit if you suspectthat the law or our Code may have beenbroken.This facility already exists in NorthAmerica and is known as the Ethics Helplineand will be known elsewhere as the EthicsReporting Line.This facility is being extendedto other parts of the world,where it ispermissible within local law.Companies that specialise in providing an independent,confidential telephone answering serviceoperate these facilities

A member of their staff will take your call andlisten to your concern.They will then make a report to the company.They will also giveyou a call reference number so that you cancontact them again to find out what is beingdone.Giving your name will help in followingup the concern quickly.Your details willremain confidential and be known only tothose specifically involved in investigatingyour concern.However,if you request thatyour call be dealt with on an anonymous basisyour wish will be respected.

Continued on the following page.

DEALING WITH UNETHICAL BEHAVIOURSECTION6.4

APPLYING THIS CODE


These policies provide more details on theethical issues covered by this Code and arecross-referenced in the text.

1.0 WORKING TOGETHER

1 Diversity and Equality of Opportunity2 Health,Safety & Environment3 Occupational Health Strategy4 Alcohol and Drug Abuse5 No Smoking at Work6 Employee Development7 Human rights8 IT policy

2.0 CONDUCTING OUR BUSINESS

9 Competition Compliance10 Company policy on Export Control11 Appointment of Advisors,Consultants and

Representatives12 Supplier Code of Conduct13 Supplier Health,Safety & Environment

3.0 RUNNING OUR COMPANY

8 IT policy14 Fraud15 Financial Services Authority Model Code16 Intellectual Property

4.0 PROTECTING OUR ENVIRONMENT

2 Health,Safety & Environment

ROLLS-ROYCE GLOBAL POLICIESSECTION6.3

APPLYING THIS CODE



© Rolls-Royce plc 2007

Whilst this information is given in good faith, based on the latest

information available to Rolls-Royce plc no warranty or representation

is given concerning such information, which must not be taken as

establishing any contractual or other commitment binding upon

Rolls-Royce plc or any of its subsidiary or associated companies.

March 2007

Designed by SampsonMayPrinted by St Ives Westerham

The information you provide will be given to the Rolls-Royce Director of Security or,inNorth America,the Vice President,Security,who is independent of the business structureand will deal with issues impartially and instrict confidence.In some cases he may need advice or information from other senior executives in order to complete hisinvestigations.Cases may also be brought tothe attention of the group of directors whoreview the company’s ethical performance.

The Board wants you to take an ethicalapproach to your work for Rolls-Royce and will protect your position and maintain theintegrity of the reporting process.Anyonewho tries to undermine this commitment,or deliberately gives false information,can expect to be disciplined,which mayinclude action up to and including dismissal.

DEALING WITH UNETHICAL BEHAVIOURCONTINUED

SECTION6.4

APPLYING THIS CODE


Rolls-Royce plc

65 Buckingham Gate

London SW1E 6AT

England

www.rolls-royce.com

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