On Tuesday the Woolf Committee published a report on BAE Systems ethical business practices. The report comes following allegations of bribery around arms deals between BAE Systems and Saudi Arabia.

The Committee, chaired by former law lord, Lord Woolf, recommended that BAE publish and implement a global code of ethical business conduct; strengthen their anti-bribery measures in the appointment, management and payment of Advisers… extend this process to Offset contracts; and [implement] a range of measures to strengthen Board oversight of ethical issues through the Corporate Responsibility Committee.

The committee also recommended that assurances be given to the board of the company and to the public of high ethical standards, provided by regular, independent external audits of business conduct.

Lord Woolf, commented on the report, Any company today which aspires to being a world-class enterprise with the benefits of access to the global economy must aim for the highest ethical standards. My Committee's report provides a route-map for BAE that will ensure it becomes a leader among global companies for its standards of ethical business conduct.

BAE Systems' recent transformation from a largely British business into a major global defence company has undoubtedly brought important economic and security benefits to the United Kingdom. However, during this period the Company's reputation has, and continues to be, tarnished by allegations of past unethical conduct, which have also damaged the global reputation of this country. Our role was not to investigate the allegations of past misconduct. But the Committee ensured that it understood the general nature of those allegations. In my view it is of great importance that the Chairman and Chief Executive have acknowledged to this Committee that the Company did not in the past pay sufficient attention to ethical standards and avoid activities which had the potential to give rise to reputational damage.

Lord Woolf continued, The Company has already made considerable progress in creating the procedures that should ensure higher standards of ethical business conduct. Given the position it is in, the Company has told us it accepts that it has no alternative but to continue along the route of taking all practicable steps to ensure that the circumstances that gave rise to allegations of past misconduct do not re-occur in the future.

BAE said on Tuesday that it would study the report and its conclusions in detail, and was committed to enacting the recommendations.