Corporate Policy

Introduction

This company policy was adopted by the Board of Directors of XELESS and has been communicated to all our employees. We are committed to implementing it on an ongoing basis. This policy is a summary of more detailed policies on these and other areas which are contained in XELESS’s Code of Conduct. The Code of Conduct provides an ethical and legal framework for all employees in the conduct of XELESS’s business. XELESS is committed to reporting and communicating openly on its response to policy issues. This policy will be reviewed from time to time and updated as necessary to reflect developments in our businesses and in best practice.

Code of Conduct

This Code of Conduct provides an ethical and legal framework for all employees in the conduct of XELESS’s business. It is about how we relate to our customers, employees, shareholders, suppliers and the community. It will build trust between XELESS and other parties.
We want XELESS to be a place where our customers enjoy doing business and come back to us and a place where people like to work. We want the trust of shareholders and lenders for access to capital markets and new shareholders. We want to be respected and welcome in the communities where we do business. These things can only be achieved by working within a Code of Conduct. Everyone who works for XELESS must be part of this.

Implementation

This Code of Conduct provides a common behavioral framework for all XELESS employees, irrespective of their specific job, direct employer or location in the world. Together with our Mission and Values it is a key part of the XELESS culture. The Code is not intended to be all-encompassing. There are areas in which we expect our businesses to develop detailed policies in accordance with local requirements. The Code provides a set of guiding principles to incorporate with whatever additional local policies are required for your businesses.

Corporate Social Responsibility and Business Integrity

General Principles

All business should be conducted in accordance with the laws and regulations of the countries in which the business is located. In the typical high risk area in which XELESS operates, XELESS will conduct business according to international standards until such laws and regulations are in force.

We compete fairly in the markets in which we operate. We must work safely and apply industry best practice to the health, safety and wellbeing of our employees, customers, suppliers and the communities in which we operate. We should aim to bring long-term benefits to XELESS, rather than short-term advantage for individuals at the expense of the organization’s long-term interests. Our belief in people and teamwork requires co-operation with our colleagues across the Group to achieve our corporate goals. Our words and actions must show respect for the diverse range of people and cultures with whom we work and for their human rights.

Corrupt practices are unacceptable. No bribes or similar payments will be made to, or accepted from, any party. All commercial transactions will be properly and accurately recorded. Sales agents, consultants and similar advisers should be appointed in accordance with these principles and paid at a rate consistent with the value of their services.

Assets and confidential information should be fully protected and must not be used by employees for personal gain. Employees must not engage in activities that involve, or could appear to involve, a conflict between their personal interests and the interests of XELESS.

Areas where conflicts might arise include: share ownership, direct or indirect personal interest in contracts, seeking or accepting gifts or entertainment beyond levels considered reasonable in your business environment, employment outside XELESS or use of confidential information. You should report possible conflicts. If in doubt, seek advice. XELESS does not make political donations but supports actively the nation building processes in our crisis support regions.

Corrupt practices are unacceptable. No bribes or similar payments will be made to, or accepted from, any party. Employees who come forward in accordance with the ‘Speaking Up’ policy when they have genuine suspicions of wrongdoing anywhere in the organization will be taken seriously and will not be victimized. They may raise their concerns with their line manager, the Head of HR or General Counsel in their business division or with the XELESS Head Office. See for details “Speaking up Policy”

Speaking Up

Trust and integrity are vital to XELESS. Misconduct and malpractice breach trust and endanger our reputation and business. The best way of protecting trust is for employees who have genuine suspicions about wrongdoing to know that they have a safe environment in which to speak up without fear of reprisal or victimization.

Our policy on Speaking Up covers anyone who wishes to disclose actual or planned wrongdoing or bad practice which:

• is against the law or is a failure by XELESS to comply with any legal obligation
• breaches Group policies or the Code of Conduct, including in particular any threat to health and safety or damage to the environment
• is a deliberate cover up of any of the above

Communications Policy

XELESS is committed to make sure that accurate information about its affairs is made available to its owners in a timely way. In order to do this, it is vital that we operate an open internal disclosure policy so that relevant information from the businesses and functions is passed through the appropriate channels to the corporate center. To this end a position has been set up at the head office which is responsible for implementing reporting processes and controls and determines guidelines for the release of information. All XELESS officers will be responsible for providing the head office immediately with material information about the activities of their business unit or area of functional responsibility.

To make sure that the right information is released externally there are certain people within XELESS who are authorized to speak to the media, investors and the public. No one else should communicate with these external parties. Furthermore XELESS’s commitment to open communication is underpinned by the Group Guidelines for Serious Incident Reporting.

We rely on our managers to bring anything significant and unexpected to our attention. If the problem subsequently goes away, so much the better, but don’t sit on it waiting to see what happens. All managers are likely to be faced at some time with a situation subject to this policy and guidelines. Accidents happen despite the best of planning. This applies in all areas: serious incidents (including environmental, health and safety, legal or regulatory breaches), contingencies which may have an impact on our results, issues which might be sensitive to investors and analysts, identifying commercial risks in making acquisitions, possible litigation or anything likely to affect XELESS’s reputation. Immediately notify your manager if there is such an event in the pipeline. Your manager will be responsible for sending the information up the line. Where events are moving rapidly or there is likely to be media coverage, your Disclosure Officer should also be notified. They will take responsibility for alerting the appropriate people. It is a serious error of judgment by a business unit for an issue known to it to be revealed to corporate management by analysts or the media, or for corporate management to find out about it from another outside source. Not all serious incidents may need to be reported externally but this is a matter for the General Manager to decide. The responsibility of all XELESS employees is to follow the internal reporting guidelines to make sure that the committee has all the facts it needs as soon as possible so that it can make an informed decision.

Environmental Risk Management

The Board views XELESS environmental policies and practices as fundamental to the way we do business. Environmental insensitivity by individuals or corporations is not acceptable to the community or to XELESS. We ask XELESS employees to take a thoughtful approach to environmental risk management.
We expect all XELESS employees to acquaint themselves with, and comply with, all relevant environmental laws and regulations covering their individual areas of operation. We also expect employees to care for the environment by improving the efficiency of our resource usage and minimizing our waste generation. The XELESS Environmental Policy is set by the Board and operates worldwide, including in countries which may not yet have enacted laws for the protection of the environment.

XELESS regularly monitors developments in environmental law and regulation and assess the impact of these on our operational practices. The local management ensures that a “site environmental management plan” is prepared for all sites and that proper records are kept to measure achievements against policy and goals.

Pre-acquisition due Diligence

Carefully audit the environmental exposures before committing to an acquisition of property, including a lease.

Competition

XELESS has a passion for success, which means that we will compete effectively and fairly in the markets in which we operate. Uncompetitive behavior is bad for our customers, makes XELESS inward-looking and complacent and is unacceptable to the community at large. XELESS’s passion for success means that we will compete effectively and fairly in the markets in which we operate.

XELESS’s policy is to comply with all relevant competition laws everywhere it operates. You should ensure that:

• Appropriate training programs for employees are developed, in conjunction with local legal experts, covering relevant areas of compliance in the particular locations of your business.
• Programs are developed for refresher training of existing employees and for the induction of new recruits, so that employees think about competition issues relevant to their particular area of operation. Keep records of those who attend these sessions.
• Compliance manuals are prepared with local legal experts and provided to employees who are in positions where they may be capable of breaching the competition laws. Competition laws can be relevant to sales representatives as well as managers, and in regional locations as well as cities. Keep records of those who have received the manuals.
• Items to be Covered in the Education and Training Programs

This list is not exhaustive. Each regional manager needs to tailor the training program to their particular business requirements and local circumstances.
Talking with competitors is always dangerous. Do not do so unless you are comfortable with the possibility that you may, at a later date, have to provide a full account of the conversation to the local competition authority.

Where you have to deal with a competitor – for example, as a supplier or a customer or on a matter relating to industry standards – be wary. Do not let the conversation slide across the boundary into competitive issues. Keep a record of what was discussed. Seek advice first.
Any dealings with your competitors, which improve your bottom line or help to justify your investment, are probably illegal. Take advice first.

Any acquisition that is justified because it gives you a “dominant market position” has problems. Any document containing this kind of language will be of great interest to your local competition authority and could get you into trouble. Seek advice first.

Imposing competitive restraints on customers, distributors or vendors can get you into trouble. When in doubt, seek advice.

“Purpose” and “likely effects” can get you into as much trouble in some jurisdictions as actual outcomes. Think about where your motives and actions are likely to take you. If your “purpose” is anti-competitive (including attempting to price so aggressively that it drives a competitor out of the market) it can be illegal even if it is ineffective. Seek advice before talking or acting.

Prepare your employees for dealing with a “dawn raid” by your local competition authority. Have a list of contacts ready, including your local competition legal advisers.

Keep employees informed about penalties for both themselves and XELESS if they engage in anti-competitive conduct. In some jurisdictions employees, as well as XELESS, can be personally liable for pecuniary or criminal penalties.

Managers are responsible for ensuring that they comply with competition laws in their area of operations and that all relevant employees receive thorough training in this area. Competition compliance programs and manuals should be regularly updated and refreshed.

Active compliance requires that you take an interest in competition issues, ask penetrating questions and demonstrate leadership in compliance. Identify the competition areas where your business is most at risk and deal with these in regular training sessions.

Tell employees about the powers of the competition authorities to make on-the-spot and other investigations, and what to do in these situations.

Tell employees that unlawful anti-competitive practices may result in XELESS paying substantial fines – for example, fines under European Union (EU) law may be as high as ten percent of the Group’s world-wide turnover – and that, in some countries, individuals may face personal fines and even imprisonment. All enquiries from competition authorities should be immediately reported to the head office. Any instances of employees engaging in anti-competitive behavior must be reported to the head office.

For assistance in this area contact the Hungarian Legal Office in our Budapest office.

Our People

The enterprising spirit of our employees is one of the great assets of our support services organization. Employees should be dealt with justly and fairly. Recognize and reward employees for their achievements and positive behavior. Bring evidence of inappropriate conduct or performance to the attention of the employee and allow the employee to respond to these allegations.

Except in the case of summary dismissal for serious misconduct, employees should be given a reasonable chance to remedy the inappropriate conduct or performance.

Occupational Health and Safety

It is XELESS policy to provide a safe working environment for all its employees.
Acquaint yourself with the requirements of all applicable occupational health and safety laws.
Apply best operating practice in your industry with regard to safety and health.

Regularly review your risk management systems to properly identify, control and prevent accidents in the workplace. When accidents happen, employees should be treated fairly during the subsequent investigation.

Safety procedures should never be compromised to meet operational targets.

All serious incidents will need to be explained to the General Manager.

Grievances

Employees should feel that they can discuss, on a confidential basis, any problem associated with their employment with the Group. They should be able to raise such issues, confident that XELESS will provide a fair, impartial and confidential determination on the issue as quickly as practical.

Non-discrimination and Sexual Harassment

XELESS is an equal opportunities employer. We are committed to developing a diverse workforce, and providing a work environment in which everyone is treated fairly and with respect, irrespective of sex, race, sexual orientation, age, disability, religion or ethnic origin. Employment and advancement within XELESS must be based on merit.

Be careful how you interact with your colleagues in the workplace, particularly those in less powerful positions. Be alert to possible harassment in the workplace and take care how you handle any resulting problems. XELESS regards actions that constitute harassment as serious misconduct.

Freedom of Association

We respect the individual’s right to freedom of association. We relate to our employees through both collective and individual agreements, according to local law, custom and practice.

Human Rights

We support and uphold the principles contained in the Universal Declaration on Human Rights. In particular we will not tolerate child labour or forced labour in our own operations or those of our suppliers.

Suppliers

We will be fair and honest in our relationships with our suppliers and subcontractors from selection through to payment.

We will assess the environmental and social issues associated with our major suppliers and seek to ensure that they share our environmental and social standards.

Major suppliers in sectors with a high environmental impact will be expected to provide evidence of their systems for ensuring good environmental performance.

Risk Management

At XELESS we are committed to the effective management of risk. No enterprise is without risk. No activity in the pursuit of opportunity can be undertaken without some possibility of failure.

Our aim is to improve our management of risk, better understand the reward-to-risk balance and reduce the risks to acceptable levels.

Data Protection and Privacy

Employees must keep confidential all information gained during the course of their employment.

XELESS policy is to maintain the privacy of information relating to its employees and customers. Where there are specific local privacy laws this policy should be incorporated into the local legal requirements.

Audit and Compliance Sign-off

Senior executives will be asked either to sign off on compliance with the relevant areas of the Code of Conduct every six months when the annual and half-yearly accounts are prepared, or to identify those areas on which they cannot sign off. The sign-offs may be subject to audit testing by Corporate Audit.