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Finmeccanica Establishes Ethics Board

Apr. 17, 2013 - 03:45AM   |  
By TOM KINGTON   |   Comments
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ROME — In the wake of a corruption probe that prompted the arrest of its former CEO, Italy’s Finmeccanica has announced creation of an ethics watchdog and said it will review all consultancy contracts handed out in the last three years.

Meeting on April 15, the company’s board approved the creation of a committee “entrusted with the task of singling out and proposing the criteria and behaviour required for a Group of global dimensions and present worldwide in the Aerospace and Defence sector, in order to comply with higher-aiming best practices,” the firm said in a statement.

The committee, which will report to the board, will be chaired by Giovanni Maria Flick, a former Italian justice minister, and will include Alberto Alessandri, a professor of criminal and commercial law at Milan’s Bocconi University; Vittorio Mincato, a former member of the internal surveillance committee at Italy’s Fiat car company; Giorgio Sacerdoti, a former vice president of the OECD Committee Against International Corruption; and Angelo Tantazzi, a former vice chairman of the London stock exchange.

Italian magistrates and Indian authorities are probing Finmeccanica’s sale of AW101 helicopters to India in 2010 amid suspicions that bribes were paid through consultants to secure the contract. Former CEO Giuseppe Orsi, who previously headed Finmeccanica’s helicopter unit, AgustaWestland, was arrested on suspicion on Feb. 12 as part of a probe and has been replaced by former CFO Alessandro Pansa. Orsi has denied all wrongdoing.

Finmeccanica said the board had decided to order an external audit of “the purchase by the Group’s companies of intangibles such as software, engineering and consulting services during the 2010-2012 three-year period. The first phase of this complex and articulate activity will be finalised by March 2014.”

A company spokesman said the firm was also planning to increase the centralization of auditing and purchasing, with increased use of tenders. The number of directors on boards at units would also be decreased, he said.

Recent investigations have shed light on the political influence on appointments of board members at Finmeccanica, which is controlled by the Italian government.

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