Tim Spicer's Sandline International took weapons to Sierra Leone to help restore President Ahmed Kabbah's government after a violent coup.
This action proved to be in breach of both United Nations sanctions and UK law.
The core of the matter now being investigated by the House of Commons Foreign Affairs Committee is how much Foreign Office officials knew of Sandline's intentions.
Concerns have also been raised that allowing a mercenary company to supply arms to the west African state goes against the foreign secretary's stated intention of an ethical foreign policy.
Mr Spicer has always insisted he told the UK high commissioner in Sierra Leone, and other officials, of his plans from the start.
And, speaking on BBC Radio 4's Today programme, he said: "Actions by private military companies that act on the side of good - such as restoring a democratically-elected president - can only fit in to what I would understand as an ethical foreign policy."
He said the "military junta terrorised the country concerned and then the democratically-elected government was restored - that can only be ethical in my view."
The solution for future cases might be to formalise the structures for informing officials of a company's intentions, he suggested.
"Situations such as this need to be clearly understood by everybody participating and perhaps in the future these things should be set down in writing."
Mr Spicer insisted High Commissioner Peter Penfold had known Sandline was going to import arms to help topple the junta.
He said: "What we were intending to do was known by the Foreign Office and we were very open about it.
"If I was talking to the high commissioner and other officials, I would assume the proper procedure was being followed."
Mr Spicer refused to comment on the "judicial process", including a series of hangings, which have taken place in Sierra Leone since President Kabbah was returned to office.