Business ModelIn our global business environment of varied cultures, we've got to go beyond simply following the law — we must act with integrity. Dell Ethics and Compliance program provides specific details of how to continuously achieve this goal. We must act legally and ethically to create a common denominator of trust within and across cultures, and to create a solid foundation to ensure sustainable business success. Our focus is on three key components: culture, compliance and credibility. Continuous attention to our code of conduct, and to the policies and procedures that flow from the code, helps us set behavioral expectations for our employees and our business partners so that we can maintain focus as we anticipate upcoming challenges in our evolving business environment.

Compliance With Laws and Rules

For Dell, compliance is about adhering to the local laws throughout our global business and to the internal rules defined in our code of conduct. Effective and aligned compliance programs are even more important during times of economic uncertainty. Now, more than ever, our shareholders and our stakeholders expect us to run our operations profitably, safely, legally and ethically.

Dell, like all companies, does not budget for the high cost of noncompliance — that cost comes right off the bottom line. By impressing this reality on employees and identifying the greatest risks of noncompliance, we invest sufficient expenditures up front to appropriately prevent, detect and react to noncompliance with the same rigor and efficiency with which we approach our growth initiatives. The Global Ethics and Compliance Office helps our business leaders identify actual current and future ethics and compliance risks so that we can develop and implement right-sized program activities, maximizing effectiveness and ensuring business strategy alignment.

Credibility With Stakeholders

Credibility is about making sure our customers, employees, shareholders and other stakeholders know and recognize Dell’s commitment to ethical and legal behavior. By binding our ethics and compliance efforts to our overall business goals, we strive to inspire trust and aspire to be a role model in the business world. We continue to learn from the many stakeholders whose lives and businesses we affect.

We're also proud of our leadership role in respected ethics and compliance organizations that significantly enhance the feedback loop we share with the stakeholders, partners and public at large. Our engagement with the following organizations both symbolizes and strengthens our commitment to continuous improvement regarding ethics and compliance and promotes an exchange of best practices that raises standards globally.

Business Ethics Leadership Alliance

In December 2008, Dell was invited by the Ethisphere Institute to help launch the Business Ethics Leadership Alliance (BELA) as a charter member and the key representative from the technology industry. With a mission to reinforce ethical principles and priorities, BELA aims to strengthen worldwide confidence in free enterprise. Our participation magnifies Dell's successes by sharing our own best practices and consolidating efforts throughout our global business. For more information about BELA, see www.ethisphere.com/bela

Open Compliance and Ethics Group

We are a founding member of the Open Compliance and Ethics Group (OCEG), and continue as an active Leadership Council Member. OCEG provides the gold standard for best-practice ethics and compliance programs by promoting Principled Performance®. It places corporate culture at the heart of its comprehensive guidance, standards, benchmarks and tools for integrating governance, risk and compliance processes. Dell helped to build out the OCEG Framework Foundation Version 2.0 (“Red Book”) — the only publicly vetted model for integrated governance, risk management, compliance and ethics management. Dell pilots many of OCEG’s best-practice programs. For more information about OCEG, see www.oceg.org.

Challenges on the Horizon

Each of Dell’s five growth initiatives carry its own risks and challenges that require more of our attention and involvement in the new fiscal year.

For example, to support our consumer business, we've produced more innovative advertisements to better communicate our product advantages to difficult-to-reach audiences. As we do so, we must continue to be vigilant about honest and accurate advertising.

With enterprise technologies, the increasing prevalence of cloud computing — computer technology that uses the internet as a platform, such as for Software as a Service (SaaS) — presents an increasing need to consider the privacy of personal data.

As we expand our presence into emerging free-market economies, we must be keenly aware of attendant risks such as bribery and corruption. Therefore, we must pay close attention to relevant metrics such as Transparency International's Corruption Perceptions Index (CPI), which ranks 180 countries by their perceived levels of corruption as determined by expert assessments and opinion surveys. As we work with our expanding global customer base and supply chain, we're constantly reminded of the cultural learning curve and the need to mitigate likely risks.