Principles of Conduct and Ethics - Alpargatas

Principles of Conduct and Ethics

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Presentation Alpargatas’ Vision, Mission and Values What are ethical principles? To whom they apply Alpargatas’ Ethics Committee

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Commitment to our internal audience What we expect from our internal audience

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Respect for the Company’s Assets Market relations Social Responsibility Press Relations Communication channels

Presentation Alpargatas’ Principles of Conduct and Ethics are a clear and practical set of guidelines based on the company’s values. They determine our company’s ethics, in other words, actions we believe are right to ensure the reputation of our patrimony and good relations with employees, shareholders, customers, suppliers, governments and society at large. People are one of our major assets. We value individuals for their personalities, preferences and interests, and we seek to personalize the way we treat people, accepting each one individually, since we believe that guidelines that are well enforced can help create a fairer society. It is essential that everyone read this document attentively so as to become more familiar with our company, taking on a commitment to disseminate the Code and follow the conduct explained in it. If all employees are aligned with this new way of acting and thinking, we will be able to build an Alpargatas that is even more consistent, correct and transparent.

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Vision Mission

Be a global company of desired brands in the footwear, clothing and accessory segments.

To win over consumers, through unique brands and products of high perceived value, creating value for shareholders, employees, suppliers and customers, and always acting with social and environmental responsibility.

Values COMMITMENT

ENTREPRENEURSHIP

Responsibility and accountability regarding our individual role in achieving the company’s goals and results, whether financial, product or service, always privileging teamwork.

To focus on growth and value creation, driven by initiative, innovation, and the transformation of ideas into business opportunities. CUSTOMER SATISFACTION

RESPECT FOR PEOPLE To construct a meritocratic environment with good working conditions and opportunities for development, encouraging satisfaction and pride in belonging.

To earn customer loyalty through the clear perception of the superior value proposition of our brands. ETHICS Behavior based on the principles of honesty, integrity and respect for the law in business and relationships.


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What are ethical principles? Our principles guide the company’s relations with employees, suppliers, customers, banks, partners, competitors and public authorities. They also guide the company’s actions within the community where it is located. The goal of this document is to be an individual and collective benchmark, ensuring that everyone who is related in any way to Alpargatas will act in accordance with the company’s values. That is why it is important to be familiar with the document and consult it whenever you face a conflict of interest.

Only do what you are sure is right. Otherwise do not hesitate to ask.


TO WHOM THEY APPLY • To everyone working in the company, regardless of position or role. • To all service providers, suppliers, customers, banks, partners and competitors. • To all Alpargatas’ activities related to public authorities, the environment, the communities where it is present and to society at large. ALPARGATAS’ ETHICS COMMITTEE The Committee reports to the CEO and is composed by the Directors of Human Resources, Sandals, Finance and Legal, and the Internal Audit Manager. It falls to the Committee to disseminate Alpargatas’ Principles of Conduct and Ethics, and sanctions resulting from non-compliance with what our principles lay down.

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Commitment to our internal audience At Alpargatas we seek to respect each person’s individuality and promote transparent relations, based on fundamental principles of ethics and inter-relations: • As a company we are committed to the equality of job opportunities for all, and to non-discriminatory labor practices that are independent of race, sex, religion or nationality. • We value our employees’ development and acknowledge people based on results and goals achieved. • We do not tolerate any favoritism or discrimination against any professional. The criterion for admission and promotion within the company is that people meet the basic requirements of each position.


• We create a safe and healthy working environment, open to creativity and fostering cooperation between teams. • We seek to assure our employees of minimal risks in their activities. Workplace health and safety conditions are therefore a permanent object of concern.

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• We encourage an attitude of respect and cooperation between employees so as to ensure an internal environment that is positive for growing the business. • We respect our employees’ confidentiality and privacy in their own affairs, provided this does not damage the company’s image or interests. • We take legitimate individual rights into consideration and respect them; however, under no circumstances do we tolerate attempts at moral or sexual harassment. • We allow employees to date and marry, and we allow employees’ relatives to be hired, provided that there is no subordination between them. • We do not allow illicit drugs, alcohol or any type of firearm; these are deemed serious offences and are subject to legal and labor sanctions.


WHAT WE EXPECT FROM OUR INTERNAL AUDIENCE • Do not do anything that conflicts with Alpargatas’ goals and business. • Do not accept any kind of position in other companies or agencies at a time that conflicts with your hours of work; activities in the legal profession may be accepted outside working hours, but this must be agreed upon with your immediate superior. • You must submit to your immediate superior any kind of activity or work carried out on behalf of Alpargatas outside the company if it departs from your usual job description, such as classes, lectures, and the presentation of brand case histories.

• The company’s facilities may be used for your personal development, for example private classes, study groups and so on, provided that they are authorized by your immediate boss. • Inform your boss in advance so that he/ she can consult the Ethics Committee when any company owned by yourself, by your relatives, or by close acquaintances provides service to Alpargatas or is the subject of a transaction or negotiation with the company. • Do not use any post, job, position or influence to favor yourself or others, and do not bow to pressure that seeks to obtain undue advantages. • Do not accept gifts worth more than US$ 100 or that seek to influence any business decision. Gifts falling into these categories must be refused or passed on to the company’s Human Resources area to be possibly raffled off among employees. • Inform your boss if you receive an invitation to an event, to travel, or the like, so that he/she can assess it for possible conflicts of interests.

• Respect general preventive health and work safety standards. • Do not disseminate images or videos of the company’s business taken on private photographic cameras, film cameras or mobile phones. The company’s activities are confidential and may not be posted on Internet portals or social networks such as YouTube, Blogs, Facebook, Orkut, Twiter, Flicker, Instagram, Pinterest. Otherwise you may have to answer legally for this action. • Do not post information or comments concerning Alpargatas on social networks, such as the above mentioned. As a representative of the company, every professional must care for its image and avoid discussing work on the Internet.

• Submit all expenses for approval, in accordance with guidelines described in the policy in force.

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Respect for the Company’s Assets Every Alpargatas professional is responsible for using and maintaining the organization’s objects and assets correctly, and these must not be used for personal benefit. These objects and assets include real estate, equipment, facilities, business plans, technical and market information, computer programs, product models, correspondence, reports and other documents and objects that are part of Alpargatas’ patrimony. Undue appropriation or use of any of these assets, or copying, selling and distributing them to third parties are serious breaches that may involve penal or labor sanctions. • Patents and inventions - Innovations developed by Alpargatas’ professionals within the company, as well as the patents stemming from this work, must be incorporated into our assets and remain with the company even after the employee has left the company. • Accounting and other records - Records must be drafted and properly monitored both by those directly responsible for them and by managers, in compliance with the legislation and with fiscal standards, and based on correct and legitimate documentation. Posts and records will remain at the disposal of the managers of the company’s control and audit areas. • Privileged information - Professionals


who learn of information that is not public must keep it confidential. The use of privileged information for personal benefit or for the benefit of third parties is a crime subject to penal and labor sanctions. This rule also applies to negotiating the company’s shares. Professionals who have access to privileged information must sign the Agreement of Adherence to the Share Trading Policy and the Instrument of Relevant Information. • Internet/E-mail - information technology resources (software, Lotus Notes and Internet) are to be used exclusively for activities related to the company’s business. Their use is monitored.

Check the company’s policies! We make available all of our policies that lay down standards for different areas and a range of circumstances. You can access them through our Intranet.

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Market relations Alpargatas and its professionals’ conduct in their relationships with clients, suppliers, banks, partners, competitors and others must be guided by the following attitudes: • Service and Quality – We offer the market quality products and services that meet the requirements of the legislation and standards related to the sector, aiming at client satisfaction and exceeding their expectations. • Confidentiality – We are committed to maintaining the information received from our clients confidential. • Cross selling – No client should be forced to buy a product or service in detriment of another. • Purchase and contracts – Our relationship with suppliers and other partners should be based on honesty, adequate cost efficiency, technical and financial reliability, and integrity throughout the negotiation, respecting the legislation, the environment and commercial, social and contractual rights.


• Competitors – In no way do we demean our competitors’ competency or other characteristics, either in writing or verbally. • Financial market – We are part of Bovespa’s Level 1 Corporate Governance, which shows our concern with enabling greater transparency of the information supplied to the investment market. We strictly follow the applicable standards and regulations, besides offering to shareholders, market professionals and potential investors correct and transparent information on our performance and strategy.

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Social Responsibility We always seek to act in accordance with the communities where our units are located, respecting people, their traditions, their values and the environment. • Child labor – We reject child labor and we make sure our suppliers do so too. Furthermore, we support and carry out apprenticeship and vocational programs for young people. • Compliance with the law – Our philosophy is strictly to comply with the legislation of those countries where we operate, and we expect our professionals to do so as well. However, we believe it is lawful to contest abusive, discriminatory or wrong legal or fiscal measures, through administrative or legal action in the competent authorities. • Political Party Activities – We do not carry out political activities, and any professional wishing to take part in the political process must do so individually without involving the company’s name or resources. Any political activity carried out by our professionals must happen outside the workplace and working hours.


• Relations with authorities, public agents and political parties – We believe that this type of contact must be based on correct professional attitudes. Any form of pressure or request from public agents not meeting this definition will be refused and the company’s management will be immediately notified. We contribute to electoral campaigns, respecting the legislation in force. • Union activities – We seek to maintain a respectful relationship with union entities and we do not discriminate in anyway against professionals who are union members. • Environment – All our activities are performed in compliance with environmental laws and standards, additionally seeking to optimize the use of natural resources and preserve nature and biodiversity. We cooperate with those communities where we are located, preserving the environment and raising awareness of environmental causes. • Education and social action – We seek to help develop those communities where we are located through the Alpargatas Institute, through educational and social projects that serve children, adolescents and young adults.

• Religious entities – We attempt to maintain a good relationship with religious entities, respecting all creeds and beliefs, both in the case of our employees and of the communities where we operate. Any donations to social projects coordinated by this kind of entity must be made through the Alpargatas Institute. Possible requests that depart from the Institute’s focus will be assessed by the company management. • Professional and corporate associations and entities – We take part in those trade associations and entities that represent our industry.

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Press Relations Alpargatas believes that printed and electronic communication outlets (newspapers and magazines on the one hand, and radio, TV and the Internet on the other) play an important role as social information channels. Therefore, whenever possible, we are open to requests from journalists. The information published by communication outlets influences the image that society forms of our company, and we therefore centralize our efforts to guarantee a suitable perception. Declarations in the name of Alpargatas may only be made by our CEO and Directors. If necessary these spokespeople may delegate the task of meeting the press to other executives.


No declaration may be given without the consent of company management.

Opt-in agreement and commitment I hereby state that I have received and acknowledge Alpargatas’ Principles of Conduct and Ethics. This document shows the day-to-day actions and operations of the company and enables understanding of actions deemed inappropriate to Alpargatas’ ethical standards or that conflict with the company’s interests. Through this document each professional will be able to clarify uncertainty about how to act in certain dubious situations, or circumstances that raise suspicion. I hereby undertake to report any and all behaviors or situations not complying with Alpargatas’ Principles of Conduct and Ethics to my superiors, to the Ethics Committee or to HR. 1. Are you aware of any occurrence, even if it only involves third parties, that is or has been in conflict with the company’s policies, and more specifically, with Alpargatas’ Principles of Conduct and Ethics? ( ) yes

( ) no

2. Would you like to make a confidential appointment with the company’s Ethics Committee or with a person nominated by the committee, to clarify or determine aspects of the application of the Conduct and Ethics in Business Policy? ( ) yes

( ) no

If so, describe your query below:

Place and Date

Full name (in block capitals)

Title

Name of superior

Place of Work

Signature

Communication channels If you have any difficulty in interpreting our Principles of Conduct and Ethics or have any doubts about how to act in given circumstances, do not hesitate to ask. Go to your immediate superior, or to Human Resources, or the Alpargatas Ethics Committee, at [email protected]. The same applies if you hear of any action that conflicts with the standards laid down herein, or of any threat or offense to employees, customers, suppliers or visitors conveyed through statements, actions, texts or images. Do not be afraid to turn to any of these contacts. Keeping a communication channel open is part of our principles. No one will be punished or suffer retaliation for information given in good faith concerning suspected improper behavior or behavior that goes against our principles.

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