Governance and Ethics

Our commitment to ethics begins with our board of directors and is maintained through every level of our organization. We work diligently to maintain the highest standards and to provide quality service and value to our customers, investors and employees.

Setting Policy

Union Pacific strives to be a source of pride for employees and to create a bond with customers, investors and community partners. To support these objectives, employees are expected to comply with applicable laws and regulations and adhere to high ethical standards, including honesty, fairness, integrity and respect. For more information, read our complete Statement of Policy Concerning Business Conduct and Ethics for Employees.

Union Pacific’s board of directors, with input from the Corporate Governance and Nominating Committee, adopts governance policies for the company. Both the board and the committee assess the Corporate Governance Guidelines and Policies to include best practices to ensure effective governance of the company.

Our board has four standing committees – audit, finance, compensation and benefits, and corporate governance and nominating – each of which is composed entirely of independent directors, is operated under a written charter and is provided specific oversight responsibilities. Members of the board and committees self-evaluate to assess performance, inviting comments on all aspects of the board and each committee’s process. These evaluations serve as the basis for a discussion of the board and committee performance, as well as recommended improvements.

The corporate governance and nominating committee is responsible for developing and reviewing the appropriate skills and characteristics required of our board members. The committee also oversees the company’s Code of Business Conduct and Ethics for Directors.

Communications with the Board of Directors

We believe it is important for shareholders to have access to members of Union Pacific’s board of directors. The board has appointed and authorized the secretary of the company to facilitate communications between interested parties and the directors. Communications from shareholders are forwarded directly to the appropriate board members.

Employees and third parties also can communicate on governance issues. The Union Pacific Values Line allows employees to anonymously report governance concerns. Reportable issues could include questionable accounting, auditing matters or safety concerns. Employees also can report directly to the company’s internal audit department or the company’s general auditor. Third parties can communicate directly with the company’s general auditor.

Audit Committee

The Audit Committee meets regularly with the independent registered public accounting firm of the company, financial management, the internal auditors, the chief compliance officer and the general counsel to provide oversight of the financial reporting process, internal control structure, and the company’s compliance requirements and activities. The Audit Committee also reviews the company’s compliance program and risk assessments, including the annual enterprise risk management plan. The Audit Committee oversees administration of the company’s Code of Ethics for the chief executive officer and senior financial officers and the Statement of Policy on Ethics and Business Conduct for employees, as well as policies concerning derivatives, environmental management, use of corporate aircraft and insider trading.

Equal Employment Opportunity and Anti-Harassment Policies

A discrimination-free workplace and fair treatment are fundamental rights of all Union Pacific employees. Union Pacific has an Equal Employment Opportunity (EEO) Policy that extends to all employees and applicants regardless of race, color, gender, national origin, age, religion, sexual orientation, gender identity, veteran status, disability or genetic information. In addition, our policy prohibits offensive behavior directed at individuals based on any of the aforementioned protected characteristics. Because we also prohibit discrimination based on sexual orientation and gender identity – in hiring, promotion, demotion, termination, transfer, leaves of absence, compensation and training – our policy exceeds federal and most state employment laws. Employees are expected and encouraged to report acts of discrimination or harassment to the company’s EEO Department.

Ethical Standards

Union Pacific has adopted a Code of Ethics for the chief executive officer and senior financial officers, a Statement of Policy Concerning Business Conduct and Ethics for employees and a Code of Business Conduct and Ethics for Directors. We continually assess the appropriateness of these codes and policies, and recommend changes that comply with federal regulations to continue to promote and support effective governance. In 2013, 89 percent of all employees were trained on the company’s Statement of Policy Concerning Business Conduct and Ethics. Additional information about our ethical standards and copies of these codes and policies are available on the company’s website under Corporate Governance.


To ensure our employee compensation is competitive, Union Pacific’s board of directors uses an independent compensation consultant to review and evaluate our compensation programs. The compensation and benefits committee uses that information to make recommendations to the board with regard to adjustments and changes needed to maintain competitive compensation practices.

Government Relations Program and Political Contributions

The political process significantly affects Union Pacific through legislation, government policies and regulatory decisions at the federal, state and local levels. As a result, Union Pacific’s board of directors believes it is in the best interests of the company and its shareholders to participate in the political process through a government relations program to educate and inform public officials about the company’s position on issues that affect its business. Through these efforts, we further public policy goals that are consistent with the company’s values and the sustainability of our business.

Union Pacific has a comprehensive oversight process to ensure that political contributions are made in a legal and ethical manner and that such expenditures best represent the interests of our company, our employees and our shareholders. As part of its oversight role, the corporate governance and nominating committee reviews, at least annually, the company’s political contributions, lobbying activities and any applicable guidelines and procedures. For more information, read our complete Political Contributions Policy and Procedures.