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Conflicts of interest are a major risk in defence, where a small number of companies compete for high value, opaque and relatively infrequent contracts with a small number of customers.
Conflict of Interest
“At thyssenkrupp business decisions are made exclusively in the best interests of the Company. Any conflicts of interest with personal matters or other business or non-business activities, including those of relatives or other related parties should be avoided. Should such conflicts nevertheless occur, they must be resolved in accordance with the law and our internal Group regulations. Conflicts of interest must be dealt with openly and transparently.” This is the wording of our Code of Conduct.
Our Group Regulation Corruption Prevention provides detailed explanations concerning “Conflicts of interest”, which applies to all employees and board members:
Conflicts of interest may arise from any personal interests, which may exist in connection or conflict with the performance of the work for thyssenkrupp, e.g.:
• Personal relation to or any other close relationship with business partners of thyssenkrupp in cases in which the employee places orders, gives approvals or the like with respect to such business partners.
• Secondary employment at other companies or self-employment that infringes on the interest of thyssenkrupp.
• Share ownership in competitors or business partners of thyssenkrupp that enables the exertion of business influence.
• Placing of private orders for products and services with distributors, suppliers or clients of thyssenkrupp, especially if the employee exercises or is capable of exercising a direct or indirect influence on the business relationship of the respective business partner with thyssenkrupp.
• The hiring of persons related to employees of thyssenkrupp if the respective thyssenkrupp employee is able to influence the hiring decision.
• Direct reporting lines between thyssenkrupp employees being closely related to each other.
Conflicts of interest must be declared in writing to the respective superior and the responsible Compliance Officer or Regional Compliance Officer in writing.
Without the prior written approval of the superior, addressees of this Group Regulation may not place orders, give approvals or the like to business partners with whom the addressee is related or maintains any other close relationship.
In cases where a conflict of interest may arise, addressees of the Group Regulation may only place private orders for products and services with distributors, suppliers or clients if the market price is paid and the payment is documented.
In fiscal year 2021/22, there were no consulting or other service agreements between Supervisory Board members and the Company. There were no conflicts of interest that Executive Board or Supervisory Board members would have had to disclose immediately to the Supervisory Board, cf. Section “Report by the Supervisory Board” of the thyssenkrupp annual report 2021/22. Memberships held by the thyssenkrupp Executive Board and Supervisory Board members (as of September 30, 2022) in supervisory boards within the meaning of § 125 of the German Stock Corporation Act (AktG) and/or comparable German and non-German control bodies of business enterprises within the meaning of § 125 of the German Stock Corporation Act (AktG) are provided in the relevant sections of the thyssenkrupp annual report 2021/22 under “Additional information”. Details of related party transactions are listed in Note 23 to the financial statements of the thyssenkrupp group.
Important related documents and links:
tk Code of Conduct: https://www.thyssenkrupp.com/en/company/compliance/code-of-conduct
Group Regulation Corruption Prevention
Avoiding conflicts of interest: https://www.thyssenkrupp.com/en/company/management/corporate-governance/corporate-governance-declaration.html (for the fiscal year 2021/2022)
Our Group Regulation Corruption Prevention states that employees must declare any conflicts of interest to their superiors and the responsible Compliance Officer or Regional Compliance Officer in writing.
Without the prior written approval of their superiors, employees who are related to or maintain any other close relationship with business partners are not entitled to place orders, give approvals or the like to such business partners.
In cases where a conflict of interest may arise, employees of thyssenkrupp may only place private orders for products and services with distributors, suppliers or clients if the market price is paid and the payment is documented.
In case a conflict of interest which may arise is not declared in writing to the superior and the Compliance officer the employee will be sanctioned according to tk’s internal guidelines for violating the Group Regulation Corruption Prevention.
As an outcome of tk’s bottom-up risk assessment and the on-going compliance dialogues between the Compliance function and the group companies, tk has set up a de-centralised approach with regard to how to manage the topic conflict of interests in the local businesses. Therefore, depending on business models, particularities in the different industries and also differing local legal requirements, companies with a high risk in this area have implemented tailored processes matching their particular risks.
However, on a group-wide level tk has implemented a specific conflict of interest check in the compliance clearing process when assessing potential candidates for its top management positions. The respective declarations are kept centrally, accessible for those responsible for oversight of the process, i.e. the Chief Compliance Officer and the relevant Compliance Officers.
Important related documents and links:
see 3.2 Group Regulation Corruption Prevention
To avoid any appearance of a conflict of interests, thyssenkrupp – based on the waiting periods defined by Transparency International – will not employ members of the following public official groups until at least one year after the person in question has left office:
- heads of state, heads of government, ministers, deputy ministers and secretaries of state;
- members of parliament (at state and federal level);
- members of supreme courts, of constitutional courts or of other high-level judicial
- bodies whose decisions are not subject to further appeal, except in exceptional circumstances;
- members of courts of auditors or of the boards of central banks (at state and federal level);
- ambassadors, chargés d’affaires and high-ranking officers in the armed forces;
- members of the administrative, management or supervisory bodies of state-owned enterprises;
- civil servants who waive pensions and municipal election officials with and without pensions.
In justified individual cases (e.g. if by way of an exception an appointment is to be made before expiry of the one-year period) a statement of commitment must be obtained from the person to be appointed confirming that a position with thyssenkrupp does not infringe any valid laws, directives or contractual obligations and that the (former) employer/administrative authority has been informed in writing in advance of the planned appointment with a description of the future position. Moreover, in justified cases a formal certificate of suitability (Unbedenklichkeitserklärung) is to be obtained from the relevant authority. For states in which no formal certificate of suitability can be obtained, comparable suitable measures are to be taken to ensure that the planned appointment or employment in an advisory capacity is in compliance with the valid laws and regulations of these states.
In addition, thyssenkrupp will not conclude advisory agreements for the purposes of lobbying with persons who previously belonged to the above-listed groups of public officials insofar as there is a connection between the previous activity and the activity intended to be carried out after leaving office which could adversely affect official interests. The aforementioned waiting period of one year must also be observed in this case.
At its own choice, thyssenkrupp is listed in the European Union (EU) Transparency Register (lobby register) and complies with the EU Code of Conduct. In connection with structured political lobbying in countries outside the EU, thyssenkrupp examines entries in national and international lobby registers and carries out a registration. thyssenkrupp implements the lobby register regulations in Germany.
Important related documents and links:
To avoid any appearance of a conflict of interests, thyssenkrupp – based on the waiting periods defined by Transparency International – will not employ members of the following public official groups until at least one year after the person in question has left office:
- heads of state, heads of government, ministers, deputy ministers and secretaries of state;
- members of parliament (at state and federal level);
- members of supreme courts, of constitutional courts or of other high-level judicial
- bodies whose decisions are not subject to further appeal, except in exceptional circumstances;
- members of courts of auditors or of the boards of central banks (at state and federal level);
- ambassadors, chargés d’affaires and high-ranking officers in the armed forces;
- members of the administrative, management or supervisory bodies of state-owned enterprises;
- civil servants who waive pensions and municipal election officials with and without pensions.
thyssenkrupp is listed in the European Union (EU) Transparency Register (lobby register) and complies with the EU Code of Conduct. In connection with structured political lobbying in countries outside the EU, thyssenkrupp examines entries in national and international lobby registers and carries out a registration. thyssenkrupp implements the lobby register regulations in Germany.
In our Code of Conduct we state:
“Donations
We regard ourselves as an active corporate citizen and demonstrate our commitment in a variety of ways. Donations and other forms of corporate citizenship are carried out solely in the interests of the company. We make no financial contributions, in particular donations or sponsorships, to political parties in our home country or abroad, organizations related or similar to parties, individual office incumbents or candidates for political offices.
Political lobbying
Our political lobbying is centralized, open and transparent. We comply with the legal requirements on lobbying and avoid at all costs unfairly influencing government policy and legislation. We have voluntarily joined the European Union Transparency Register and comply with the European Union Code of Conduct.”
Important related documents and links:
tk Code of Conduct: https://www.thyssenkrupp.com/en/company/compliance/code-of-conduct
Group Regulation Communications