Who We Are
Nonpartisan and non-profit, the DII has seventy-seven signatory companies comprising the top U.S. defense and security companies. Collectively, our signatory companies receive over $540 billion per year in federal funds.
Our Mission: A Culture of Ethical Conduct
DII’s mission is the continued promotion and advancement of a culture of ethical conduct in every company that provides products and services to the United States Armed Forces.
We serve our U.S. Armed Forces, acting as stewards of taxpayer resources and meeting the highest standards of ethics and efficiency. The CEOs of every DII member company must sign a personal letter abiding by DII’s core principles. Our members commit to honesty in all business dealings, the protection of taxpayer resources, and high-quality products and services for the U.S. military.
What We Do
Every year, DII helps train hundreds of ethics officers on the latest issues in ethics and compliance. They in turn help train hundreds of thousands of other defense-industry employees. An industry leader, DII holds regular meetings and conferences to share best ethical practices, and provides instructional resources to members and non-members alike.
DII companies have trail-blazed beyond strict legal requirements. In 1986, 18 of the nation’s top defense companies created DII. They voluntarily agreed to establish written codes of business ethics and train employees to comply with them. The first chair of the DII Steering Committee was Jack Welch, of General Electric. Today, federal lawmakers have adopted many of the reforms DII instituted decades ago.
What the GAO Says About Us
In 2009, the Government Accountability Office (GAO) analyzed the quality of ethics programs at the largest U.S. defense firms. The firms, almost all DII members, excelled. GAO found that DII members had stringent ethics programs in place years before the Federal Acquisition Regulations (FAR) required it.
Origins of DII
In 1985, during the rapid buildup to combat the Soviet threat, allegations of widespread fraud, criminal misconduct, and government mismanagement threatened the integrity of the defense acquisition process. President Reagan appointed the Packard Commission, or “The President’s Blue Ribbon Commission on Defense Management,” to recommend reforms.
In its February 1986 Interim Report, the Packard Commission observed that waste, fraud, and abuse had eroded the public’s confidence in the defense industry and the Defense Department. The Commission urged defense contractors to improve the defense acquisition process through greater self-governance.
“To assure that their houses are in order, defense contractors must promulgate and vigilantly enforce codes of ethics that address the unique problems and procedures incident to defense procurement,” the Packard Commission wrote. “They must also develop and implement internal controls to monitor these codes of ethics and sensitive aspects of contract compliance.”
In response, Jack Welch of General Electric and the CEOs and senior officials from 17 other defense contractors voluntarily met to draft principles. These core principles became known as the Defense Industry Initiative on Business Ethics and Conduct. By July 1986, 32 major defense contractors had pledged to adopt them.
DII members still follow these principles:
- Have and adhere to written Codes of Conduct;
- Train employees in those Codes;
- Encourage internal reporting of violations of the Code, within an atmosphere free of fear of retribution;
- Practice self-governance through the implementation of systems to monitor compliance with federal procurement laws and the adoption of procedures for voluntary disclosure of violations to the appropriate authorities;
- Share with other firms their best practices in implementing the principles, and participate annually in “Best Practices Forums;” and
- Be accountable to the public.