JSC «Ukrainian Defense Industry» has committed to implementing NATO's integrity recommendations, marking a significant step toward adopting North Atlantic Alliance standards in Ukraine's defense industrial complex. This was discussed during a working meeting where the National Agency for Corruption Prevention presented an action plan to ensure consistent and effective implementation of these recommendations, fostering interoperability between Ukraine's and NATO countries' defense industries. The event was attended by representatives from the NATO Representation to Ukraine, JSC UDI, the Norwegian Ministry of Defence’s Centre for Integrity in the Defense Sector, the Government Office for European and Euro-Atlantic Integration, Ukraine’s Ministry of Defense, and other security and defense sector stakeholders. Participants reaffirmed their commitment to raising awareness of ethical standards and implementing effective anti-corruption practices. Additionally, measures were outlined to ensure transparency in human capital engagement and evaluation, as well as the introduction of a fully automated personnel management system. «Further development of an anti-corruption infrastructure based on the best standards within the JSC UDI and subsidiaries will accelerate the achievement of interoperability between Ukrainian and NATO defense industries. Our goal is to ensure that our levels of accountability, transparency, and protection against corruption risks align with those of leading Alliance defense companies,» stated Maksym Fedorenko, Director of the Compliance and Risk Management Department at JSC UDI.  Foto – NACP

Representatives from IFBEC organized the second round of consultations on best practices for cultivating an ethical culture within the defense sector, specifically for employees of the Compliance and Risk Management Department of the Joint Stock Company Ukrainian Defense Industry. The event, which took place on May 20, was supported by the NATO Building Integrity Program. These consultations aim to support UDI's efforts to implement the best international practices in building integrity, compliance, risk management, and strengthening good governance. They also aim to facilitate the sharing of experiences with leading international experts. According to the Building Integrity Program, NATO appreciates Ukraine's commitment to strengthening the principles of accountability, integrity, and transparency in the security and defense sector, and it continues to provide comprehensive support in this area. IFBEC was founded in 2010 by member companies of the Aerospace Industries Association of America (AIA) and the Aerospace and Defense Industries Association of Europe (ASD). The IFBEC provides an opportunity for industry participants to exchange information on best practices in ethical business conduct for the aerospace and defense industries.

During this period, UDI implemented Strategy’s main activities. Strategy’s main focus for the first quarter of 2025 was strengthening the «Tone from the Top.» This included preparing UDI management's anti-corruption commitments for 2025, conducting leadership training on building a culture of integrity at the local level, implementing State Anti-Corruption Program measures, and public reporting on minimizing corruption risks. By publishing this report, we emphasize that UDI adheres to its commitments to building an anti-corruption culture in the Ukrainian defense industry and will continue to do so. We are grateful to everyone who contributed to the implementation of the plan. If you become aware of any violations or abuse at UDI or subsidiaries, please report them. Hotline: 0-800-211-606 Email: antikor@ukroboronprom.com Letter to the address: 36 Degtyarivska St., Kyiv, 04119 (marked «Report of Violation»). Confidentiality is guaranteed. The message may be anonymous.

The establishment of an environment unencumbered by corruption constitutes a pivotal step in ensuring the stable and sustainable development of an enterprise. It fosters an atmosphere where honesty, transparency, and responsibility are valued. This type of culture helps reduce internal conflicts, prevent abuse, and increase the efficiency of all processes. In 2025, the main task of our department is to ensure that available defense industry resources are used to strengthen the country's defense capabilities and not to enrich individuals who prioritize their own interests over the safety of Ukrainians. We cannot allow corruption in the defense industry to hinder our victory, so we are committed to eliminating it. Develop a culture of mutual respect and trust. Each employee actively expresses their opinion, proposes solutions, and participates in processes that affect the overall result. Strengthen the professionalism of anti-corruption officers. Every employee should know who to contact regarding integrity or compliance with applicable laws and regulations. Maintain openness and transparency in all our actions. We believe that honesty is the only way to ensure true trust among partners and within the team. Constantly review and improve our internal documents, adapting them to NATO and EU conditions and requirements. This will help ensure the sustainability and effectiveness of our fight against corruption. Develop a system of transparent corporate governance based on the principles of integrity and mutual responsibility. All of our businesses must meet high international standards. There is no place for corruption when a country is fighting for its independence and security. Therefore, we will ensure that each enterprise's activities are legal, efficient, and aimed at achieving the main goal: Ukraine's victory. Fighting corruption should be a priority for all of us. Please report any violations or abuse by UDI employees or subsidiaries through the following channels: hotline: 0-800-211-606 email: antikor@ukroboronprom.com Maksym Fedorenko, Director of the Compliance and Risk Management Department JSC Ukrainian Defense Industry

Since the beginning of the UDI reform, we have achieved positive results in developing an anti-corruption infrastructure. Over the past year, the public sector of the Ukrainian defense industry has laid the groundwork for a long-term anti-corruption policy. Basic anti-corruption compliance policies have been approved, corruption risks have been assessed, and channels for reporting violations, as well as regular training and proper information, have been introduced. Implementing the anti-corruption policy is practical; all changes are taking place on the ground with the help of an effective network of anti-corruption officers’ subsidiaries. This year, I plan to support the chosen course of building a culture of integrity and actively participate in implementing anti-corruption measures. To ensure the continuity of the development of the anti-corruption infrastructure at Ukroboronprom and its enterprises, I undertake to: Maintain transparency of the company's and enterprises' activities. This means providing public access to up-to-date information on the development of anti-corruption infrastructure. Adhere to the principles of ethical leadership. This includes training executives and managers in the ethical principles of leadership and management. I will promote the improvement of anti-corruption policy. This involves improving anti-corruption compliance policies and documents in line with the best international practices and standards. Promote the implementation of automation and information infrastructure projects. This involves improving the identification of corruption risks and responses to them. Ensure proper assessment of corruption risks. This involves facilitating the detailed verification, assessment, and monitoring of the company's and enterprises' internal processes. Deepen partnerships with the public sector. This involves actively cooperating with NGOs, professional associations, and international communities. Improve the protection of whistleblowers. This involves providing a support and protection system for individuals who report violations. Ukraine's defense industry must be technologically advanced, competitive, and free from corruption. Only then will we bring Victory closer and become the Arsenal of the free world. Oleh Huliak Director General, JSC Ukrainian Defense Industry

We, the members of the Supervisory Board of JSC «Ukrainian Defense Industry», firmly believe that long-term sustainable success can only be achieved through responsible actions. This is especially true in these extraordinarily difficult times for the Ukrainian people, when the quality and reliability of defense contracts are literally a matter of life and safety for millions of people. We, the members of the Supervisory Board of JSC «Ukrainian Defense Industry», reaffirm our unwavering commitment to uphold the highest standards of integrity, responsible stewardship of resources, and zero tolerance for corruption. Every strategic and operational decision we make is based on the principles of transparency and accountability. In this regard, a key priority for the Board of Directors in 2025 is to strengthen our efforts to ensure that all aspects of our operations - including sourcing, production and delivery - are conducted transparently and in accordance with the recommendations of the Organization for Economic Cooperation and Development (OECD) and global best practices for responsible business conduct. We recognize that the trust placed in us by the Ukrainian government, our partners and the Ukrainian people is of the utmost importance. We have established a strict zero-tolerance policy against corruption, which is actively implemented at all levels of the company. Our operating model is designed not only to meet Ukraine's immediate defense needs, but also to ensure the long-term stability of the defense sector. This includes continued investment in innovation, effective use of resources, and responsible management of social and environmental impacts. We understand that true success depends on the ability to balance operational efficiency with responsible and sustainable practices, ensuring not only the growth of the company, but also a positive impact on national security and society as a whole. In support of our mission to provide the Ukrainian Armed Forces with the equipment they need to defend themselves, we remain committed to the values that guide our progress: integrity, transparency and sustainable development. We recognize the immense challenges we face, but we are confident that by adhering to these principles we can make a significant contribution to Ukraine's victory and the achievement of a lasting peace. We are deeply grateful for the trust placed in us and will continue to ensure that our operations meet the highest ethical standards. Our commitment to these values will guide every decision, action and interaction, now and in the future. With faith in Ukraine's victory and respect for every employee in the defense industry, David Lomjaria Timur Bondaryev Oleksiy Honcharuk Sergiy Konovets Tymofiy Mylovanov  Lynndy Smith

At the end of 2024, Kyiv hosted a two-day annual meeting of representatives of the Compliance and Risk Management Department of the Ukrainian Defense Industry JSC with a network of anti-corruption officers of its subsidiaries. The event, which was attended by over 40 people, provided an important platform for sharing experiences, discussing achievements, and pinpointing critical areas for future anti-corruption initiatives. A highlight of the meeting was the presentation of the new Anti-Corruption Strategy for 2025-2027. Its main goals are: strengthening the «tone from the top» of management; improving the institution of commissioners; increasing the efficiency of the system of reporting channels for violations and manifestations of corruption; Improving business processes by implementing anti-corruption mechanisms. ensuring the functioning of the internal control system; Adherence to responsibility, accountability, and transparency in relations with stakeholders is also essential. Training was also held on information security, risk management, and risk declaration in the ESG (environmental, social, and governance) area. Potential partners and financial institutions take the ESG criteria into account when making investment or lending decisions, as do counterparties and suppliers during commercial activities. «In wartime, ensuring transparency and accountability, as well as improving the efficiency of risk management, are important factors for increasing stakeholder trust and the efficient use of resources,» said Maksym Fedorenko, Director of the Compliance and Risk Management Department of UDI.

The Ukrainian Defense Industry and the Basel Institute on Governance are commencing their partnership to develop anti-corruption capacity in Ukraine’s defense industry. The primary objective of this cooperation is to support Ukraine's efforts to promote effective corruption prevention measures and to strengthen its position as a candidate for European Union membership. Within this partnership's framework, both parties' efforts will be directed towards further developing compliance mechanisms and anti-corruption policies, establishing a secure environment for whistleblowers, and conducting strategic analysis of corruption risks.    The Basel Institute on Governance is an independent, non-profit research and training center operating globally. Its mission is to strengthen governance and counter corruption. The Institute employs a people-centric approach, working to understand local contexts, providing mentorship and guidance, and fostering mutual learning among decision-makers, practitioners, and implementors. The Basel Institute assists in building robust governance structures and institutions capable of resisting corruption. It also mentors on the investigation, and prosecution strategies where these systems fail. The Institute leverages its practical experience in research to help develop effective anti-corruption strategies.

As part of the development of the anti-corruption infrastructure, which is taking place in the Joint-Stock Company Ukrainian Defense Industry, the practice of personal commitments of leadership has been implemented. Director General of JSC UDI Herman Smetanin has already made them public. And now Olena Kovalyova, Director of the General Department for Compliance and Risk Management, announces her own personal commitments in the position. Remind you that these steps are an integral part of transparent reporting to civil society, which is provided by the Anti-corruption Strategy of the JSC UDI.

Action plan of the Strategy for Prevention, Detection and Counteraction of Corruption of the Joint Stock Company «Ukrainian Defense Industry» for 2023-2024  

The Joint Stock Company «Ukrainian Defense Industry» (UDI) continues the implementation of the Strategy for Prevention, Detection, and Counteraction of Corruption for 2023-2024. The action plan has been approved and published on the Company's website. The main focus of the IV quarter of 2023 is the analysis of corruption risks and their elimination. Today, according to the plan, work continues in three key areas. The first point of the effort is the analysis of the implementation of the recommendations for eliminating corruption risks, which were provided by the state National Agency on Corruption Prevention (NACP) and the non-governmental organizations «StateWatch» and «Together Against Corruption.» It examines what has been done based on the results of the reports to determine which risks have already been eliminated, which have not, and what still needs to be worked on. This task is planned to be completed by the end of this year. The second direction is the assessment of existing and potential risks in appointment to management positions, property management, and procurement, followed by creating and implementing appropriate management decisions. The third key point is the diagnosis of the current state of work of the network of anti-corruption commissioners at UDI's companies. It is about analyzing their performance of their duties, the degree of independence from company managers, etc. As a result, the activities of the authorized representatives will be standardized and free from the influence of extraneous factors, which will increase the overall efficiency of work on corruption prevention. «Developing the anti-corruption infrastructure is one of the main tasks set before our Company,» said Olena Kovalyova, Director of the Compliance and Risk Management Department of UDI. - This requires a systematic approach to each stage, a thorough study of the effectiveness of available tools and measures, the quality of the work of relevant specialists, the commitment of managers to standards of integrity, and the creation of a new internal culture based on the rejection of corruption at all levels from a factory employee to the General director."  

The Joint Stock Company «Ukrainian Defense Industry» (UDI)  is returning to the practice of The Competition Commissions, which will select candidates for the position of directors of several subsidiary companies. Thus, in its performance, UDI adheres to the principles of transparency, openness, and corruption prevention, including quality personnel selection area. It is one of the essential steps in the implementation of the approved Anti-Corruption Strategy. UDI is gradually updating the team and strives to attract the most talented and efficient professionals to manage subsidiary companies. It is due to a particular procedure for selecting candidates for relevant positions with the involvement of a specialized commission. Potential managers will be considered based on competitiveness, fairness, impartiality, and transparency.