SUPPLY CHAIN RESPONSIBILITY

The California Transparency in Supply Chains Act of 2010 requires us to disclose our efforts to eradicate slavery and human trafficking from our direct supply chain. We take very seriously all efforts to end forced labor – whether in the form of prison labor, indentured labor, bonded labor, human trafficking, or otherwise – and require our suppliers to maintain a strict “employment is voluntary” policy.

SUPPLY CHAIN VERIFICATION

Our policy is to evaluate potential suppliers’ factories before they enter our supply chain to assess compliance with standards including country-related risk for issues including forced labor, human trafficking and slavery. Currently we use internal auditors for this process.

SUPPLIER AUDITS

We evaluate our suppliers’ adherence to our standards through internal auditing procedures. Each year we inspect a subset of our suppliers’ factories.

DIRECT SUPPLIERS' CERTIFICATION OF MATERIALS

We are working on mapping and understanding impacts further up from our direct supply chain in order to develop standards for upstream suppliers of our direct suppliers. Our goal is to eradicate slavery and human trafficking from our indirect supply chains as well.

STANDARDS FOR COMPLIANCE

If a supplier is found to violate our standards or applicable laws, it is responsible for improving performance against a corrective action plan instituted by us. If the factory fails to make progress against the plan, it is subject to review and sanctions, including termination. We think the best way to combat human trafficking and slavery is to work with the cooperation of our suppliers through the establishment of clear expectations and protocols.

TRAINING

Employees and management with direct responsibility for supply chain management are provided internal training on forced labor, including human trafficking and slavery. We also encourage our suppliers to participate in external training programs and seminars on social compliance issues.