Business integrity

INTEGRATED REPORT 2020

Topic description

For PMI, conducting business with integrity means complying with the law, our Guidebook for Success (PMI’s Code of Conduct), and other company commitments. Our Guidebook for Success defines the rules we follow and describes the values that form the foundation of good ethical judgment.

The business case

Our customers and employees expect us to operate ethically and with integrity. The Ethics & Compliance department plays a key role in our efforts to do so, and in ensuring that our company transformation succeeds by supporting and enabling a working environment where speaking up is normal and easy.

Business integrity is a tier 2 topic within our strategic pillar Operating with excellence.

Our progress in 2020

The right thing to do

Managing ethics is an integral part of any successful business operation, and major decisions that affect the company’s bottom line often involve questions of ethics. We all depend on systems that apply laws fairly and protect fundamental rights. Without the rule of law, it is difficult for companies to operate successfully. Issues like corruption, unfair competition, and unsafe workplaces undermine societal well-being.

While following the rules is critical, it is sometimes not enough. It can be possible to behave in an unethical way while still complying with the law or other rules. Good ethical judgment helps us to guard against such failures and builds lasting business success.

Achieving our aims

We understand that PMI’s reputation comes from the sum of our individual actions. We want to ensure that we conduct business ethically and with integrity. To help us achieve this, we maintain an Ethics & Compliance (E&C) program.

Our E&C program is led by our VP and Chief Ethics & Compliance Officer, who reports to PMI’s General Counsel and also reports regularly to the Board of Directors and its Audit Committee.

Our code of conduct, known in PMI as our Guidebook for Success, sets clear standards and expectations. Its mandatory provisions apply to all PMI employees, officers, and directors. Key risk areas include anti-bribery and anti-corruption, anti-competitive practices, conflicts of interest, information protection security and data privacy, responsible marketing and sales, scientific integrity, supply chain responsibility, and workplace integrity. Our Principles & Practices (P&P) provide more specific guidance on the Guidebook topics.

Our Responsible Sourcing Principles (RSP) set clear standards for our suppliers in line with internationally recognized standards on human rights, environmental management, and business integrity. Read more in our chapter on sustainable supply chain management.

We evaluate our E&C program periodically, using a census to understand employee opinions and experiences related to E&C matters. Our last census was completed in 2018 and reported on in last year’s sustainability report. While the next census was initially scheduled for 2020, we postponed it to 2021, due to the special circumstance resulting from the outbreak of the COVID-19 pandemic. We periodically conduct third-party-led assessments of our E&C program, with the most recent run in 2019.

Our progress in 2020

Performance metrics

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This online content about our Integrated Report should be read in conjunction with PMI’s 2020 Integrated Report. The information and data presented here cover the 2020 calendar year or reflect status at December 31, 2020, worldwide, unless otherwise indicated. Where not specified, data come from PMI estimates. Please also refer to 'About this report' on page 3 of the 2020 Integrated Report for more information. Aspirational targets and goals do not constitute financial projections, and achievement of future results is subject to risks, uncertainties and inaccurate assumptions, as outlined in our forward-looking and cautionary statements on page 145. In the 2020 Integrated Report and in related communications, the terms “materiality,” “material,” and similar terms, when used in the context of economic, environmental, and social topics, are defined in the referenced sustainability standards and are not meant to correspond to the concept of materiality under the U.S. securities laws and/or disclosures required by the U.S. Securities and Exchange Commission.