The core values of Ingersoll Rand —Integrity, Respect, Teamwork, Innovation and Courage — are the foundation of our enduring success. Integrity leads this list of values because it is fundamental to our 145-year reputation as a company that can be trusted by customers, suppliers, shareholders and the communities in which we operate. Integrity also is fundamental to our philosophy of corporate governance. We not only operate in accordance with the law and the highest standards of ethical conduct, but do what is right for our stakeholders, for the environment, and for society.
Our commitment to act with integrity is core to the Ingersoll Rand Code of Conduct and Global Human Rights Policy. These documents frame the ethics and legal practices that we expect all of our employees to uphold, wherever they are located around the world, as well as our corporate standards for working conditions and human rights, as modeled after international organizations such as the International Labor Organization and the United Nations.
While some of these standards and rules reinforce legal imperatives in the places where we operate, each one of them reflects our commitment to fairness, honesty and ethical business practices.
Our Code of Conduct
Our Code of Conduct embodies our approach for managing employment, labor relations, human rights, diversity, and equal opportunity, as well as company policies on equal employment opportunity, affirmative action, and harassment. Every employee receives a copy of the Code, which is available in multiple languages and can be accessed under the “Our Company” tab on our website.
Our salaried employees participate in an annual Code of Conduct training program and complete a certification agreeing to compliance. Ingersoll Rand has a 100 percent response rate target for salaried staff completing the Annual Compliance Training Program. In 2015, 100 percent of such employees completed the training and certification. Training for our Code of Conduct, which mirrors many of the objectives of the Ingersoll Rand Global Human Rights Policy, consists of a two-hour online training program with a questionnaire for all employees to complete.
Global Anti-Bribery and Corruption Policy
Ingersoll Rand is committed to winning business on the value proposition of our brands and the superiority of our product and service offerings. Therefore, we require our employees around the world to comply with our Global Anti-Corruption Policy, which is also a part of our Code of Conduct. Our Board of Directors has oversight responsibilities for this policy which, in essence, prohibits the giving and even the offering of anything of value in exchange for a commercial or governmental business advantage.
The Global Anti-Bribery and Corruption Policy underscores our commitment to compliance with the anti-corruption laws of all countries in which Ingersoll Rand and our agents, consultants and affiliates operate. In case they occur, all alleged incidents of corruption are promptly escalated to and investigated by the company’s Ethics and Compliance Group. In the event that an investigation were to confirm the corruption allegation, prompt remedial and corrective actions would be taken, including but not necessarily limited to, termination of responsible employees and/or third parties, as well as enhancement of internal controls and processes. In addition, the company may choose to self-report the violation to the appropriate regulatory authorities.
We communicate our Global Anti-Bribery and Corruption Policy to all our employees around the world through our yearly Code of Conduct and Antitrust training programs. We also address the potential for bribery and corruption when conducting due diligence in qualifying acquisitions and new business partners. We evaluate disclosure of matters in light of applicable regulatory requirements (including applicable SEC rules and regulations and the listing standards of the NYSE) and the materiality of such matters to our company.
Political Activities and Contributions
The laws of many countries prohibit or strictly limit contributions by corporations to political parties and candidates. Although our employees may engage in personal political activity, they are prohibited from doing so on behalf of Ingersoll Rand or in their capacity as a company employee. In the United States, Ingersoll Rand manages a nonpartisan Political Action Committee (PAC) which is compliant with all applicable laws and is regulated by the Federal Election Commission (FEC).
Under the FEC, all funds received by the PAC and resulting contributions to federal candidates are publicly disclosed. For a list of federal contributions, see here. Although Ingersoll Rand employees may make personal contributions to political parties and candidates, they are not permitted any type of reimbursement from the company. The PAC is funded exclusively through voluntary contributions by salaried employees.
Ingersoll Rand Federal Political Action Committee Total Contributions (U.S. only)
Ethics HelpLine Reporting Platform
Our third-party, global Ethics HelpLine is a whistle-blowing mechanism through which employees and external stakeholders, including our business partners, may report any known or suspected violation of laws, regulations or the Code of Conduct. The Ethics Helpline also serves as an instrument to conduct human rights reviews.
Employees may telephone or access the Ethics HelpLine through a secure website and country-specific, toll-free telephone numbers any time and can remain anonymous, unless restricted by local privacy laws. The availability of the Ethics HelpLine and instructions for its use are covered in detail in the Code of Conduct. The Ethics HelpLine is overseen by the Audit Committee of the Board of Directors and managed by an independent third party organization. We take violations of the Code of Conduct seriously. All reports to the Ethics HelpLine are investigated and actions are taken immediately to ensure compliance.
Global Human Rights Policy
Our commitment to employees, business partners, customers and communities is strengthened by our Global Human Rights Policy. The policy covers non-discrimination and harassment, prohibitions against child and forced labor, freedom of association and the right to engage in collective bargaining. Many of the adopted standards align with basic concepts regarding working conditions and human rights advanced by international organizations such as the International Labor Organization and the United Nations; the policy represents Ingersoll Rand minimum standards in these areas.
While local laws or regulation may necessitate a different interpretation or application of the policy, we believe that the fundamental values it embodies should serve as our global minimum business standards. Our Code of Conduct employee training program, which mirrors many of the objectives of the Ingersoll Rand Global Human Rights Policy, is conducted annually. This training encourages employees who believe this policy has been violated to report the suspected violations through the company’s Ethics HelpLine. The Ingersoll Rand Global Human Rights Policy is also posted online, including instructions on how to report suspected violations through the Ethics HelpLine.
Ingersoll Rand is committed to complying with laws pertaining to freedom of association, consultation, and collective bargaining. Ingersoll Rand respects its employees’ right to individually decide to join or refrain from joining any lawful organization. The company’s Global Human Resources Policy emphasizes freedom of association.
The Ingersoll Rand Board of Directors has oversight responsibility for the processes established to report and monitor systems for material risks applicable to the company. Our Enterprise Leadership Team (ELT) functions as Risk Counsel for the company. The Board focuses on the company’s general risk management strategy and the most significant risks facing the company and ensures that appropriate risk mitigation strategies are implemented by management.
The company has identified and regularly evaluates strategic, operational, financial and compliance risks, and has established a corresponding control mechanism that enables management to respond effectively to risks in these areas as they may arise. The Board has delegated to its various committees the oversight of risk management practices for categories of risk relevant to their functions as follows:
- The Audit Committee oversees risks associated with the company’s systems of disclosure controls and internal controls over financial reporting, as well as the company’s compliance with legal and regulatory requirements.
- The Compensation Committee considers risks related to the attraction and retention of talent and risks related to the design of compensation programs and arrangements.
- The Corporate Governance and Nominating Committee oversees risks associated with sustainability.
- The Finance Committee oversees risks associated with foreign exchange, insurance, credit and debt.
The Board considers enterprise risks and succession planning at each Board meeting, receiving reports from each Committee as to risk oversight within their areas of responsibility. Presentations are made to Audit Committee regularly summarizing key risks across the enterprise and ranking enterprise risks based on the Enterprise Risk Management Integrated Framework as published by the Committee of Sponsoring Organizations (COSO), which measures vulnerability, severity of impact and speed of onset.
This framework (1.2.1 Risk Responsibility – 2015 ERM Program) is a three-dimensional approach, considering objectives, risk components and all layers of the organization. We have identified risk objectives and risk components for strategic, operational, financial and compliance risks with a corresponding control mechanism which allows management to respond according to the particular risk or opportunity. Sustainability risks and opportunities, such as those related to climate change and natural resource impacts, are included in this process. We also reference the COSO framework in communicating risk internally to ensure that it is consistently managed across the enterprise.
Our Chief Financial Officer, who reports directly to the Chief Executive Officer, has been appointed as the company’s Chief Risk Officer. In this role, the Chief Financial Officer periodically reports on risk management policies and practices to the relevant Board committees or to the full Board for the purpose of decision making regarding the Board’s enterprise risk oversight and the company’s risk management and mitigation strategies.
Board of Directors
The responsibility for our governance and direction is in the hands of a Board of Directors composed of 12 members — 11 of whom are considered “independent” according to New York Stock Exchange standards. Four of the company’s directors are women, and two are non-U.S. citizens. Each of the Board’s four committees — Audit, Compensation, Finance and Corporate Governance & Nominating — has a written Board-approved charter detailing its responsibilities. Only non-employee directors serve on these committees.
The Board’s core responsibilities are as follows:
- Select individuals for Board membership and evaluate the performance of the Board, Board committees and individual directors.
- Monitor corporate performance and evaluate results compared to the strategic plans and other long-range goals.
- Review the Company’s financial controls and reporting systems.
- Review the Company’s ethical standards and legal compliance programs and procedures.
- Oversee the Company’s management of enterprise risk.
- Monitor relations with shareholders, employees, and the communities in which the Company operates.
Role of the Chairman and CEO
Our Chairman and Chief Executive Officer, Michael W. Lamach, is responsible for the management of the company under the guidance of the Board, and is the only company employee serving as a director. The Board delegates to the Chief Executive Officer, and through that individual to other senior management, the authority and responsibility for managing the company’s business. The Board’s role is to oversee the management and governance of the company and to monitor senior management’s performance.
Role of the Lead Director
The Board appoints a strong, independent Lead Director from among the Board’s independent directors for a minimum three-year term, and believes this role adequately addresses the need for independent leadership and an organizational structure for the independent directors. The Lead Director coordinates the activities of all of the Board’s independent directors, serves as the principal confidant to the CEO, ensures that the Board has an open, trustful relationship with the company’s senior management team, and is responsible for numerous duties in addition to the duties of all Directors as set forth in the company’s Corporate Governance Guidelines. Our current Lead Director is Richard J. Swift, who was re-appointed to the position in 2013. Swift was originally appointed as Lead Director in 2010, and has been a member of the Board since 1995.
Corporate Governance Guidelines
Ingersoll Rand is managed under a corporate governance framework and guided by Corporate Governance Guidelines, which ensure that we operate within applicable legal statutes and New York Stock Exchange requirements, and in a manner that is consistent with ethical global business standards and aligned with stakeholder interests. These guidelines detail the Board’s responsibilities, policies, procedures, practices and committee structure. Click here to access comprehensive information about corporate governance at Ingersoll Rand.