**Abstract**

The relevance of researching the ways to improve the level of corporate culture in the military-industrial complex is based on the increasing role of the militaryindustrial complex due to the growing tension in the world. According to the Stockholm International Peace Research Institute (SIPRI) data published in March 2018, total global sales of a weapon in 2013–2017 rose by ten percent compared to the previous five years (2008–2012). Among the biggest exporters of armament are also United Kingdom, France, Germany, and China. The economic significance of the military-industrial complex is based on the fact that it fosters the development of related industries such as metallurgy, electronic engineering, instrument-making and so on. At the same time the military-industrial complex faces the following industry-specific challenges: - Rigid state regulation of production; - State control over export and import operations; - High sensitivity to political factors of the external environment; - Ambiguous and polarized public attitude towards weapon and its manufacturers, from massive support of patriotically-minded part of the population to absolute aversion of its pacifist part. It is interesting to identify those particular methods of improving company performance which are successfully put into practice and are really beneficial for the military-industrial complex enterprises applying them which may later serve as a basis for developing a set of measures to increase corporate culture level in the military-industrial complex enterprises in different countries. The analysis is based on comparing the corporate culture of global industry leaders in the USA, Russia and the UK, which are the world's biggest weapon exporters. The studies and conclusions presented in this analysis can be practically beneficial not only for the military-industrial complex enterprises the specificity of which is a stress test for corporate culture but also for other industrial sectors.

**Keywords:** corporate culture, fight against corruption, conflict of interest, corporate ethics, social policy

#### **1. Introduction**

Studying corporate culture is an up-to-date direction of research, already quite relevant in the modern complex of management sciences. In the 1980s the idea that effective leadership and long- term business success are connected with creating a healthy corporate structure in the company was first put forward in the book

"Corporate Cultures: The Rites and Rituals of Corporate Life" by Terence Deal [1]. The same ideas were outlined in the book "Organizational Culture and Leadership" by Edgar Schein [2]. The most comprehensive study of the interrelation between positive corporate culture and performance is considered to be the book "Corporate Culture and Performance" by John Kotter and James Heskett [3].

In the corporate governance theory, there are a number of approaches to defining corporate culture. For example, М. Albert and F. Khedouri [4] define corporate culture in the following way, "Atmosphere or climate in an organization is called its culture. The culture reflects prevailing habits, customs, and reflections in an organization."

In Howard Schwartz's and Stanley Davis' opinion [5], corporate culture is a "complex of convictions and expectations shared by the members of an organization, these convictions, and expectations shape norms which sufficiently determine the behavior of individuals and groups in an organization."

According to Elliott Jaques [6], сorporate culture is a "way of thinking and mode of action which grew into the habit and became a tradition, is more or less shared by all employees of the enterprise, and which should be learned and at least partly adopted by new staff members to "blend in."

According to A. Krylov [7], "Corporate culture is a set of a set of ideas, values, generally accepted patterns and norms of behavior typical for a particular organization; the joint experience of the members of an organization, formed in the course of collective activity and expressed in both material and spiritual forms."

The Asia Pacific region is increasingly perceived as the century's geopolitical center. With one-third of the world's population, a significant share of the world's trade and production, it seems that the weight of this region is going to be highly relevant in the foreseeable future.

Some countries in the Asia-Pacific region are major importers of conventional weapons, including South Korea, Taiwan, Singapore, and Australia. There are also defense industries in the region that are being developed towards a more selfsufficient production, such as the industries in North Korea and China. The growing economy of China, in particular, has facilitated an increase in military spending which provides consistent financial support to their defense industries.

The new data from SIPRI's Arms Industry Database shows that sales of arms and military services by companies listed in the Top 100 have increased by 47 per cent since 2002 (the year from which comparable data is first available). The database excludes Chinese companies due to the lack of data to make a reliable estimate.

For the first time since 2002, the top five spots in the ranking are held exclusively by arms companies based in the United States: Lockheed Martin, Boeing, Northrop Grumman, Raytheon and General Dynamics. These five companies alone accounted for \$148 billion and 35 per cent of total Top 100 arms sales in 2018. Total arms sales of US companies in the ranking amounted to \$246 billion, equivalent to 59 per cent of all arms sales by the Top 100. This is an increase of 7.2 per cent compared with 2017.

A key development in the US arms industry in 2018 was the growing trend in consolidations among some of the largest arms producers. For example, two of the top five, Northrop Grumman and General Dynamics, made multibillion-dollar acquisitions in 2018. US companies are preparing for the new arms modernization program that was announced in 2017 by President Trump. Large US companies are merging to be able to produce the new generation of weapon systems and therefore be in a better position to win contracts from the US Government.

The combined arms sales of the 10 Russian companies in the 2018 ranking were \$36.2 billion—a marginal decrease of 0.4 per cent on 2017. Their share of total Top 100 arms sales fell from 9.7 per cent in 2017 to 8.6 per cent in 2018. This can be

### *The Corporate Culture of the Enterprises of the Military-Industrial Complex DOI: http://dx.doi.org/10.5772/intechopen.94479*

explained by the higher Top 100 total in 2018 due to the substantial growth in the combined arms sales of US and European companies.

Among the 10 Russian companies listed in the Top 100, the trends are mixed: five companies recorded an increase in arms sales, while the other five showed a decrease. Russia's largest arms producer, Almaz-Antey, was the only Russian company ranked in the top 10 (at 9th position) and accounted for 27 per cent of the total arms sales of Russian companies in the Top 100. Almaz-Antey's arms sales rose by 18 per cent in 2018, to \$9.6 billion [8].
