Global Integrity with Local Ownership
At Flowserve, we have established a culture of integrity with our associates, business partners, and shareholders. We demonstrate this culture by establishing "Integrity" as one of our core Values, which are the guiding principles for how we achieve our purpose. We action our Values through our Behaviors, which include the Behavior to “Act with Integrity, Always.” By embracing our Global Integrity with Local Ownership mindset and consistently upholding our Values and Behaviors, our 16,000+ associates worldwide at over 300 locations contribute to Flowserve’s reputation for integrity, honesty and excellence.
We Are Led by Our Values
Overview of Flowserve’s Integrity & Compliance Program
Flowserve’s compliance program focuses on five pillars: Culture, Speaking Up, Strategy, Accountability and Risk Management. These pillars guide us in enhancing our program, so we continue our commitment to uphold the highest ethical standards.
We promote a culture of integrity with our associates through a variety of means. For example, our Integrity Champions are associates selected from local sites who are empowered and responsible for raising integrity awareness, delivering training, and ensuring integrity is a consideration in site decisions. Additionally, Integrity Insiders are monthly communications that provide all associates with practical guidance on navigating ethical issues. During our annual global Integrity & Compliance Week, we celebrate our culture of integrity and build associate engagement by featuring programming designed to highlight resources, raise awareness, and provide guidance on navigating ethical dilemmas.
Flowserve provides several avenues through which associates can raise concerns, ranging from reporting to members of management, human resources or to our anonymous hotline. We also provide an Investigations Playbook to provide transparency about investigations and encourage our associates to speak up and report any unethical or questionable conduct. To continuously evaluate our Speaking Up resources, the Integrity & Compliance team regularly monitors and analyzes hotline metrics and trends, including the number of overall reports, the number of reports made anonymously, and the types of issues being reported, with global, regional and business platform breakdowns.
We evaluate the root causes of any concerning behaviors that are discovered and implement remediation measures to minimize the risk of recurrence, such as discipline, training, control improvements or policy changes. Further, where disciplinary action is recommended, we have established a Disciplinary Committee comprised of senior leaders from across the business, to provide independent, objective, efficient and consistent disciplinary actions. To provide independent accountability of the Integrity & Compliance team, our Chief Compliance Officer has a dotted reporting line to the Audit Committee of the Board of Directors and provides quarterly updates on the status of the Integrity & Compliance program.
Flowserve implements measures to identify, manage and mitigate risk. We conduct annual fraud and enterprise risk assessments and use the results to identify top risks, monitor them, and implement mitigation measures when necessary. To minimize risk from our supply chain, we expect all Flowserve suppliers to adhere to our Supplier Code of Conduct, and failure to comply may result in the termination of the business relationship. To manage trade compliance risks, we also provide associates with a Trade Compliance Playbook, which is a detailed reference manual that contains an overview of each element of Flowserve’s trade compliance program, including simple instructions and key insights into each trade topic.
Our Code of Conduct Reinforces Integrity Ownership
Our Code of Conduct incorporates and reinforces Flowserve Values and the laws, regulations and policies that apply to our business. It also helps our associates understand the importance of integrity at Flowserve and our commitment to conducting business in an honest, ethical and transparent manner. The Code is available in all nine of our core languages.
Our Supplier Code of Conduct
We have established a Supplier Code of Conduct, which sets forth our commitment to conducting business in an ethical, legal and socially responsible manner within our global supply chain. This commitment extends to our stance against slavery and human trafficking, as set forth in our California Transparency in Supply Chains Act Disclosure and our UK Modern Slavery Act Statement. We expect all Flowserve suppliers to adhere to the Supplier Code of Conduct. If a supplier is found to be in violation of the Supplier Code of Conduct or any other Flowserve policy, it may result in the termination of the business relationship.
Reporting Concerns and Non-Retaliation
Upholding our Code of Conduct, our values, and our integrity culture is the responsibility of each Flowserve associate. All of our associates are empowered and encouraged to speak up and report concerns. We have multiple resources available to report concerns, including anonymous options through our Ethics Hotline. We take reports seriously and conduct prompt and thorough investigations. We prohibit retaliation and no adverse action will be taken when associates:
- Refuse to do something that violates our Code of Conduct, polices, or the law, even if the refusal results in a loss of business to Flowserve.
- Raise a concern in good faith about a potential ethical issue.
- Cooperate in an investigation.
Anyone retaliating against an associate for these reasons will be subject to disciplinary action, up to and including termination of employment or business relationship.
Environmental, Social and Governance Commitment
Globally, Flowserve associates are guided by our purpose to create extraordinary flow control solutions that make the world better for everyone. One of the ways we strive to make the world a better place is through our commitments to environmental, social and governance (ESG) issues, both in our own operations as well as in the operations of our customers who rely on our products to improve the world around us.
Upholding high ethical business standards plays a critical role in establishing a foundation for positive global impact. Flowserve's 2020 ESG Report includes an overview of our Integrity & Compliance program and descriptions of key initiatives from the year.
Administration and Oversight
Flowserve’s Chief Compliance Officer has overall responsibility for the management of our Integrity Compliance program. She reports directly to the Chief Legal Officer and has access and reporting responsibility to the Audit Committee of Flowserve’s Board of Directors. The Chief Compliance Officer also regularly engages with our Ethics and Compliance Committee, which is comprised of our executive and senior leaders.