compliance

Code of Conduct

ISOVOLTA Group aims to require everyone who acts on our behalf to comply with our values and rules of behavior. These are clearly set out in the “ISOVOLTA Code of Conduct” which acknowledges ISOVOLTA’s social and environmental responsibility within our sphere of influence.

UN Global Compact

ISOVOLTA has committed itself to implementing the ten UN Global Compact's principles (UNGC) on human rights, labor rights, the environment and anti-corruption. The ISOVOLTA Code of Conduct sets forth clear rules of behavior in accordance with the UNGC. Its principles guide ISOVOLTA’s behavior toward its internal and external stakeholders and serve as the basis for many other of our policies and guidelines such as our Business Ethics Directive.

• Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights;
• Principle 2: make sure that they are not complicit in human rights abuses.
• Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;
• Principle 4: the elimination of all forms of forced and compulsory labor;
• Principle 5: the effective abolition of child labor;
• Principle 6: the elimination of discrimination in respect of employment and occupation.
• Principle 7: Businesses should support a precautionary approach to environmental challenges;
• Principle 8: undertake initiatives to promote greater environmental responsibility;
• Principle 9: encourage the development and diffusion of environmentally friendly technologies.
• Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.

Regulations and Directives

Beyond the ISOVOLTA Code of Conduct, the Group upholds a series of self-imposed obligations based on both internal and external standards. ISOVOLTA regulations for the management of sustainability and business ethics across the Group are contained in a series of directives and standards. In addition, some business segments and sites may have established their own specific complementary guidelines and procedures.

ISOVOLTA Compliance Policy

PART A: COMPLIANCE

1.            OBJECTIVES OF COMPLIANCE

1.1          THE AIM AND SCOPE OF COMPLIANCE

Compliance deals with the integrity management of people in the fulfillment of their professional duties and the support as well as the monitoring of regulatory conduct of business. Compliance thus helps to protect Isovolta and its employees from regulatory and reputation risks in particular through

• protection of and monitoring of the flow of confidential information,
• establishment of and monitoring the efficiency of information barriers,
• prevention of insider dealing and market manipulation,
• rules of conduct of personal account dealings of employees and directors and relevant public disclosure,
• security based company control reporting,
• security transaction restrictions,
• conflict of interest identification and management including the conflict potential which may arise out of incentive and compensation schemes,
• procedures and processes for
• proper investment advice and sales practices as well as suitability of products,
• proper client-related asset operational procedures,
• proper complaints management,
• proper licensing and registration of business activities,
• proper licensing and training of employees and sales forces,
• Enabling any employee of Isovolta to make a complaint or bring forward allegations with respect to alleged improper activities within the Group in a fully protected and anonymous way and take care of an effective handling of any such complaint.

1. 2         THE CODE OF CONDUCT

The Isovolta Code of Conduct for Business Ethics and Compliance (Code of Conduct) reflects and supports such aims by defining minimum standards for all employees with the view to prevent situations which might question the integrity of Isovolta and its employees. The Code of Conduct is attached hereto as an Appendix and forms an integral part of this Compliance Policy.

1.3          AREA OF APPLICATION

This policy applies to all Entities and International Divisions of the Organization ISOVOLTA Group.

1.4          APPROVAL AND UPDATING

The Compliance Policy has been approved by the board of management of Isovolta AG. It can be updated by Group Compliance in order to meet and adjust to new Compliance risks and regulatory changes as well as integrity requirements at any time.

2.            FUNDAMENTAL PRINCIPLES

2.1          THE ISOVOLTA COMPLIANCE APPROACH

Isovolta Group applies a risk-based decentralized Compliance approach with the necessary direct Group Headquarters impact as more closely defined in this policy. The Group Compliance standards reflect the Group’s core values and mission as an international player as well as relevant regulatory requirements. Such standards shall be adhered to and/or implemented as appropriate by the entities in accordance with the compliance-relevant risk exposure.

2.2          THE COMPLIANCE RISK EXPOSURE AND ASSESSMENT

1.            Compliance relevant risk-exposure is traditionally linked to corporate financing, anti-corruption, investment and asset management services. However, depending on the regulatory and market environment of an organizational entity (“OE”) and the applicable industry standards, compliance-relevant risk-exposure can therefore also arise in any field of a business.

2.            The compliance relevant risk exposure of an Organization must be assessed by each organization in its own responsibility.

2.3          ORGANIZATIONAL DUTIES IN DEPENDENCE OF RELEVANT RISK EXPOSURE

According to the relevant compliance risk exposure the Organization must meet general or specific organizational compliance duties. General organizational duties do not require a specific Compliance Officer or Department or the use of specific compliance instruments.

3.            RESPONSIBILITIES

3.1          THE BENCHMARK FOR ISOVOLTA COMPLIANCE STANDARDS

1.            Operating Entities (OE) are required to ensure an appropriate organizational and operational structure as well as continuous monitoring procedures in line with their structure and business activity so that their services are carried out in accordance with applicable law and regulation and existing compliance relevant risks are reduced to a satisfactory level.

2.            Whether the organizational duties arising under this Compliance Policy have been adequately implemented is assessed after an overall inspection of all measures taken.

3.            Where conflicts of interest or compliance-relevant circumstances with a potential group-wide impact may exist or might come into existence with the lapse of time, the relevant circumstances shall generally be reported to Group Compliance as appropriate. However, any employee shall have the opportunity to report the relevant circumstances directly to Group Compliance.

4.            Group Compliance advises the OE’s management on request of how to implement and support the compliance function and takes care for a respective know-how transfer within the Group.

3.2          GROUP COMPLIANCE

1.            Group Compliance establishes minimum compliance standards for the Group and continuously adjusts such standards so as to appropriately reflect upcoming changes and trends in the regulatory, market or industry standards.

2.            Group Compliance assists the OEs on request in the assessment of the relevant compliance risk of an OE or particular business activity as well as in the establishment and ongoing operation of the compliance function. It may give consultative advice concerning such issues to the OE Compliance Officer and/or the management of the OE, if it is of the opinion that the compliance function of such OE or specific aspects of such function should be improved or specific compliance relevant circumstances should be handled in a different way as determined by the OE or respective Compliance Officer. Group Compliance will also assist the OE’s in the establishment of internal procedures for handling employees´ complaints with regard to the Code of Conduct.

4.            IMPLEMENTATION / MONITORING

1.            Group Compliance monitors based upon and, in addition to, the OE’s internal audit function, whether the OE's compliance risk assessment and the measures taken by an OE to fulfill its organizational compliance duties meet the Group's minimum standards which are set by Group in consideration of the regulatory and market environment as well as industry standards. Local standards may be established and applied on the basis of the general Group standards.

2.            Compliance relevant events or circumstances with a potential group wide impact including inside information, potential conflicts of interests, pending or threatening regulatory or penal investigations or procedures must be communicated by the OE. Communication to Group Compliance must be direct and without interference of the OE management.

3.            Group Compliance has the right to intervene and require from the OE's management such measures that are necessary to improve the compliance function to an adequate level.

4.            In preparing the above assessments, Group Compliance has direct and unlimited access to any information and employee of an OE. The Group Compliance access to information can be exercised by requiring the OE departments to deliver such information or by direct information gathering through Group Compliance. Unless impractical or unadvisable for compliance reasons to the discretion of Group Compliance, any information gathering and assessment activities of Group Compliance with regard to an OE or OE employee shall be exercised only subsequent to a timely information of the OE management and/or the International Division of Isovolta responsible for the respective OE.

PART B:                COMPLIANCE WITH INTERNATIONAL SANCTIONS

Part B of the Isovolta Compliance Policy deals specifically with International Sanctions. General organization issues such as the area of application and the role of the board of management already described in Part A are also applicable for this Part B.

1.            OBJECTIVES

Isovolta operates worldwide as an integrated industry partner. It is absolutely obligatory for the management and the staff of all entities within the Isovolta Group to fully respect and adhere to all applicable Sanctions Laws and refrain from any effort to circumvent their application. This needs to set up a mandatory operational framework to provide for:

•  The due observance of Sanctions Laws,
•  The proper awareness of managers and employees thereof,
•  Appropriate administrative activities to support and monitor compliance with the respective laws.

Failure to comply with Sanction Laws can expose the employee and/or Isovolta to civil or criminal penalties as well as disciplinary actions by Isovolta.

2.            FUNDAMENTAL PRINCIPLES

2.1          SANCTIONS LAWS

The term “Sanctions Laws” refers to laws, regulations and/or administrative measures that restrict or prohibit the conduct of business with

• Governments, citizens, residents or legal entities of designated countries;
• Designated individuals or legal entities irrespective of their country;
• Particular goods or services, e.g. weapons or high tech equipment or parts thereof.

2.2          MULTILATERAL SANCTION

Multilateral sanctions are usually imposed by a confederation of states (e.g. United Nations, European Union), obliging member states to incorporate such sanctions into their national laws. These Sanctions Laws are commonly accepted.

2.3          UNILATERAL SANCTIONS

Unilateral sanctions are imposed by single states and normally apply only to persons or legal entities within the jurisdiction of the issuing state. Countries may and do have different views about the reach of their national jurisdiction and may extend their jurisdiction abroad based upon specified jurisdictional links. As a consequence, increased due diligence on jurisdictional links are necessary for business related to specific countries. As these countries may vary from time to time, Group Compliance gives appropriate guidance with regard to the current appraisement.

2.4          JURISDICTIONAL LINKS

Examples for jurisdictional links are:

• The historical incorporation of an Isovolta company has been in the imposing country.
• An Isovolta company’s seat of management is located in the imposing country.
• A person involved in business (e. g. underwriter, supervisory manager) is a citizen (working abroad), a permanent resident (working abroad), an alien employee or a board member of/in the imposing country.

3.            DUTIES OF THE OPERATING ENTITIES

Each OE is required to ensure an appropriate organizational and operational structure as well as continuous monitoring procedures in line with its business activities. The management of an OE has prime responsibility to ensure the fulfillment of the below mentioned requirements. It may confer these functions to staff members with a particular expertise on sanctions. Requirements are:

• The business activities shall be carried out in accordance with applicable Sanctions Laws and local regulatory requirements;
• In case of business with countries that are specially designated by Group Compliance, a Sanctions Risk Evaluation Form has to be filled in and forwarded to Compliance for prior approval;
• The Compliance Officer or the officer entrusted with sanction risks shall annually give the assessment, whether there is any identifiable sanction risk exposure in connection with the business of the OE.

4.            CIRCUMVENTION, TRANSPARENCY, REPUTATION RISK AND SPECIFIC APPROVAL

4.1          PREVENTION OF CIRCUMVENTION

Specific attention shall be given to transactions which are structured in an unusual manner, without a clear business purpose, or contrary to an originally intended structure. This includes straw man and other structures that are either designed to hide the true economic beneficiary of a transaction or otherwise disguise the fact that a transaction is subject to a Sanctions Law. Structuring business generally and in advance so as to ensure compliance with potentially applicable Sanctions Laws does not constitute circumvention:

4.2          TRANSPARENCY

It is absolutely necessary to fully disclose all relevant details of an intended business in order to enable the involved persons to come to an adequate decision whether a Sanctions Law is applicable or not. This includes complete and comprehensive transaction documents, invoices and money transfer instructions.

4.3          REPUTATION RISK

Non-compliance with a Sanctions Law may cause media, public opinion or business pressure even if such law is legally not applicable. If reasonable concern exists, that an intended business might attract negative public attention, the department in charge of reputation risk shall be involved in the decision.

4.4          SPECIFIC APPROVAL BY COMPLIANCE

Group Compliance may decide that transactions with regard to specific countries may be executed only upon prior approval either by Group Compliance or by the compliance department of an Isovolta subgroup.

ISOVOLTA RESPONSIBLE MINERAL SOURCING POLICY

SUPPLIER CODE OF CONDUCT