Ethics is a difficult subject for any arms company to discuss, but controversial UK defence manufacturer BAE Systems yesterday made it the central subject of its annual meeting.

BAE's yearly gathering is a regular opportunity for arms trade opponents to rebuke the directors about the immorality of their trade. Yesterday's meeting in London had added spice after the company called for the Serious Fraud Office to bring to a close investigations into alleged bribery by the company and decide whether to charge it.

Only a day earlier BAE had agreed to implement in full the recommendations of a report by former Lord Chief Justice Lord Woolf into its ethical standards.

Chairman Dick Olver said the issue was one of protecting its reputation: safety and ethics will feature on the company's targets in future and it will not shy away from turning down business if it could damage BAE's image.

"We are concerned to ensure we address our reputation with all our stakeholders more effectively than we have in the past," he said.

"As a company pursuing global growth, we realise we must do better to protect and defend our reputation."

But this was no admission of any wrongdoing. Olver continued: "Your company's policy has always been to abide by the law. I and our fellow directors have no reason to believe the company has broken the law."

Nevertheless, he said: "We are aware that the public expectation of what is appropriate business behaviour evolves over time."

Its action plan on these issues is to be made public during July and its progress against this will also be published.

However, Olver still drew fire from shareholders, including many campaigners who own a solitary share in order to give them entrance to the meeting.

Nancy Kershaw, attending her tenth AGM, asked the company about its manufacture of controversial cluster bombs, eliciting the eventual answer that it had not sold any since 2004. Will it compensate the victims? That's the responsibility of the governments that bought them, Olver replied.

The issue of its deals with Saudi Arabia - a focus of SFO attention - was brought up repeatedly.

Olver ducked, parried and fiercely rebutted. The one question to which he had no real answer was on which ethical criteria the company used when deciding which weaponry to produce.

"We look at our strategies, our skills and the requirements of our customers. We look at the things we would like to be involved in. There are risks in certain countries, there are risks in certain products and obviously we have to take a very careful view about risk," he said.

Both sides tested the endurance of the other. "I would like to come to something I raised last year and the year before and I would like to come to it progressively," one questioner started ominously. BAE, for its part, called upon an accountant to read out its auditor's report.

Other subjects did occasionally reach the limelight. Olver pledged that the company would announce the replacement for chief executive Mike Turner before the company's interim results announcement on August 1.

Turner himself, during a short stint at the podium, also hinted strongly he wanted the government to sign off an aircraft carrier order which is vital to the future of its Govan and Scotstoun plants.

However, for most attending the meeting, questions about ethics, Saudi Arabia and bribery dominated. "Has anyone got questions about anything different?" Olver eventually asked on the two-and-a-half-hour mark when much of his audience had already gathered hopefully around the still-covered buffet outside.

They did not seem to.