Code of ethics

The Company, in addition to complying with current laws and regulations while conducting its business, intends to observe high ethical standards while running its day to day business: these standards and their main inspirations, were collected in this code of ethics (hereinafter also referred to as code). The code is an integrative instrument, of the behaviour rules enforced by the law: simple compliance with the law, despite being a fundamental condition, is often not sufficient for the Organisation, which demands that all company decisions and behaviour of its employees are based on ethical rules, including situations where they are not contemplated by the law. The term personnel refers to all of the people that work for the Organisation, or on behalf of it: employees, directors and various independent contractors (for example continuous or occasional independent contractors, professionals and similar). The code expresses the ethical commitments and responsibilities undertaken by those who, for various reasons, cooperate to achieve the Organisation’s objectives for: shareholders, employees, independent contractors, external consultants, suppliers, customers and other individuals. Individuals that, as a whole, are defined with the term stakeholders, as they have an interest in the company’s business. The general rules taken from the Code of Ethics of Confindustria (available for consultation on the website www.ui.biellla.it) were taken into account when drafting this Code of Ethics. Every person who cooperates with the Organisation is required to always follow the instructions contained in this Code of Ethics. Special attention is required from the Managers, who have the task of supervising the operation of the code and updating it: these individuals are asked to ensure that the adopted principles are constantly applied and to maintain a behaviour that is an example for employees and independent contractors. The code is made available to customers, suppliers and other third parties that interact with the Organisation: in particular, it is brought to the attention of third parties (possibly with digital systems or through the website), that receive assignments from the Organisation, or have long-term relations with it, formally asking them to comply with the conduct principles and criteria, as part of the relations they have with the Organisation. Moreover, the code is made known to all personnel, as identified above, with the same procedures.

1. The Company

THE MARCHI GIOVANNI S.r.l. GROUP has been active in the textile sector for almost 50 years. It carries out its yarn production and sales activities through the companies MARCHI & FILDI S.p.a. and FILIDEA S.r.l. MARCHI & FILDI S.p.a. at its premises in Biella, Via Maestri del Lavoro 4/A, produces yarns for apparel and upholstery. Finished product logistics are managed at the Verrone office on Strada Trossi 55. FILIDEA S.r.l. (company in joint venture with the Turkish Group Abalioglu Holding A.S.) at the Biella premises, Via Maestri del Lavoro 4/A, carries out sales of yarns for apparel and upholstery, as well as for the technical sector; at the Cerrione site, Via A. De Gasperi 26 there is a spinning pilot plant, where research and development activity in the textile field is carried out. This R&D department collaborates with the most important Italian and European research institutes to find increasingly cutting edge solutions and that are able to meet the continuously evolving needs of customers. Yarn dyeing activity is also carried out at the same site, while at the Verrone site on Strada Trossi 55 finished product logistics are managed.

1. General principles

Management defines the objectives of the Group and actions principles to satisfy Customers, respect the environment, prevent significant incidents, prevent occupational accidents and protect the health of its employees. The companies are committed to:

1. Guaranteeing their Customers, in addition to products and services compliant with requested and implicit requirements, constant information and assistance on product application developments;
2. Guaranteeing stakeholders respect of the environment, a safe work environment and suitable healthcare surveillance for employees;
3. Developing its processes with constant focus on continual improvement of the effectiveness of adopted management systems, including the use of the best technology available and economically compatible;
4. Adopting all of the necessary measures, within the limits of what is available technical feasibility and economically compatible, for preventing any form of pollution, or, at any rate, to reduce it to a minimum, by performing a production process control, in particular on the consumption of water and energy and the production of waste and waste water, trying to reduce to a minimum the volume of produced scrap, promoting recovery and recycling where possible and rationalising the use of natural and energy resources, trying to use energy from renewable sources where possible.
5. Complying with laws and regulations and any voluntary agreements concerning the prevention of pollution, management of environmental emergencies, environmental protection, occupational health and safety, product safety, assessing beforehand environmental effects and the impact on employee health and safety of all new activities and all new products and processes.
6. Guaranteeing cooperation with public authorities for establishing and updating emergency procedures, in order to reduce the effects of an emergency to a minimum with consequent accidental impact on the environment that occurs despite everything;
7. Promoting continuous personnel training to instil a culture of individual and collective behaviour aimed at:
   1. Respecting the environment, protecting health, reinforcing safety, as moral duties towards colleagues, the community and territory;
   2. Satisfying customer requirements, including cogent ones, related to products, maintaining transparency towards the same on products, processes and personnel.
8. Put in place measures to ensure that contractors operating on site on behalf of the enterprise work in accordance with our safety and environmental protection principles.
9. Using sustainable materials where possible or that can be re-used at end of life;
10. Providing the human and instrumental resources necessary to achieve the objectives.

General management defines and periodically reviews the objectives, implemented management system and integrated quality, safety, environmental and social policy according to the following guidelines:

•  Reinforce and develop the current market position with the realisation of products with characteristics able to meet the growing needs and requirements of customers.
•  Improve the efficiency and effectiveness of processes, environmental and safety performances of Group sites, by adopting a prevention criterion;
•  Consolidate the organisation’s functionality by making it flexible for a prompt response to the customer and stakeholders to monitor the objectives.

The organisation’s commitment is not intended to be limited exclusively to the territory where it operates, and it is for this reason that it has decided to join associations, achieve certifications or develop studies such as:

• BCI, Better Cotton Initiative, a non-profit organisation developed to make global cotton productions better for those who grow it, for the environment where it is grown, as well as better for the future of the textile sector, by creating a sustainable commodity.
• FSC, Forest Stewardship Council, environmental certification to promote responsible management of forests and plantations.
• GRS, Global Recycling Standard, certification that promotes the responsible and sustainable development in the textile sector, verifying the contents of materials in products and observance of environmental and social criteria.
• LCA, Life Cycle Assessment, life study of the organisation’s sustainable products, in order to provide measurable parameters and complete information to customers and the consumer, quantifying the impact of production compared with traditional productions.
• Oeko-Tex Standard 100, certification that verifies that the products respect the human and ecological requirements of the standard.
• Tessile & Salute, declaration of the Tessile e Salute association that verifies the requirements on products for traceability, composition of chemicals contained in products with regard to the end user and worker.
• Traceability & Fashion, certificate that proves the conformity of products that can be completely traced, aimed at transparency towards the customer and sector.

These principles, already set out by the company in various initiatives, constitute the basis for the definition of a series of behaviours considered fundamental, thus the Organisation agrees to respect them with regard to anyone. On the other hand, it believes that these principles must be known and respected by all subjects, internal and external, who have relations of any nature with the company.

Compliance with laws and regulations	The Organisation works in compliance with the law and takes actions so that all personnel act accordingly: its people must maintain behaviour compliant with the law, regardless of the context and activities performed. This commitment must also hold true for consultants, suppliers, customers and for anyone who has relations with the company.
Behaviour integrity	The Organisation is committed to supply quality services and competeing on the market according to the principles of fair and free competition and transparency, maintaining fair relations with public, government and administration institutions, with the population and with third party enterprises.
Rejection of all discrimination	In the decisions that influence the relations with its stakeholders (selection of customers, relations with shareholders, personnel management and work organisation, selection and management of suppliers, relations with the surrounding community and the institutions that represent them), the Organisation avoids all discrimination based on age, sex, sexuality, health status, race, nationality, political opinions and religious beliefs of its stakeholders. The same criterion is adopted in the decision to hire or relations with personnel. Any supplier or customer selection criteria, based on objective criteria, can instead be considered and will not affect the rules of this code.
Promotion of human resources	The management of human resources is based on respect of the personality and professionalism of each person, ensuring their physical and moral integrity: personnel must always have a conduct respectful of the people they come in contact with, on behalf of the Company, treating each one equally and with dignity. The Organisation rejects all forms of forced work, or child labour, and does not tolerate human rights violations.
Protection of health, safety and the environment	The Organisation intends to conduct its activity in a socially responsible and sustainable manner from an environmental viewpoint.
Fairness in contracts	Contracts and job assignments must be carried out as knowingly established between the parties: The Organisation agrees not to take advantage of conditions of ignorance or incapacity of its counterparties.
Protection of competition	The Organisation agrees to protect the value of fair competition. Therefore, all subjects that for various reasons work with the Organisation cannot participate in agreements in contrast with the rules that govern free competition between enterprises, with the exception of what is specified in relation to agreements, conventions or similar based on objective criteria.
Promotion of the Organisation’s investment	The Organisation works so that the results, including economic/financial, are such, so as to promote the investment of the shareholder, as much as possible.
Transparency and completeness of information	In the formulation of contracts or rules governing relations with third parties, the Organisation makes sure to specify the relative clauses clearly and in an understandable manner.
Personal data protection	The Organisation collects and processes the personal data of customers, independent contractors, employees and other subjects, both natural persons and legal entities. These data consist in any information used to identify, directly or indirectly, a person and may include sensitive data, such as those that reveal the ethnic or racial origin and/or health status. The Organisation agrees to process such data within the limits and in compliance with the requirements of current legislation concerning privacy, with specific reference to Italian Legislative Decree 196/3003 (“Privacy Law”). The Organisation’s personnel who is asked, within the scope of their job, to process data, both sensitive and not, must always proceed in compliance with this law and the operating instructions given to them. The Company promotes the knowledge of this issue to its personnel.
Information processing	Information regarding the counterparties are processed by the Organisation in compliance with the confidentiality of the data subjects, if necessary.

2. Behaviour principles personnel must adhere to

The people (administrators, employees and independent contractors) must observe the following principles:

Professionalism	Each person performs his/her work activity and own duties with diligence, efficiency and correctness, making the best use of the instruments and time available, and undertaking the responsibilities connected with fulfilling requirements.
Loyalty	The people are required to be loyal to the company.
Honesty	In terms of their work activity the people are required to know and diligently comply with the organisational model and current laws.  In no case shall pursuit of an interest of the Organisation justify dishonest conduct or conduct not in compliance with the law.
Correctness	The people shall not use for personal reasons – unless within authorised limits – information, assets and equipment available to them in performing their function or the job assigned to them. Each person shall not accept, or perform, for him/herself or others, pressure, recommendations or indications that can be detrimental to the Organisation or undue advantages for him/herself, the Organisation or third parties; each person shall reject, and not perform, promises of undue offers of money or other benefits
Confidentiality	The people shall ensure maximum confidentiality, related to news and information constituting the company’s wealth or related to the company’s business, in compliance with the law, current regulations and internal procedures. Moreover, the Organisation’s people are required not to use confidential information for purposes not connected with conducting their activity.
Conflict of interest resolution	People shall promptly report to their superiors or contacts any situations or activities in which there may be a conflict of interest with that of the Organisation, by the same people or their immediate family, and in all other cases where there are significant reasons for expediency, The people shall respect the decisions proposed by the Organisation in these cases.

 

3. Conduct criteria

3.1.  Relations with personnel

Personnel selection	The assessment of personnel to hire is performed based on the correspondence of the candidate profiles, compared to those expected and the company needs, in compliance with equal opportunities for all concerned subjects, as well as compliance with current laws. The information requested is strictly connected to verification of the aspects required by the professional and psychological/aptitude profile, with respect for the private sphere and candidate’s opinions. The Company shall avoid nepotism and special help.
Constitution of the job contract	Personnel is hired with a regular job contract or with legally permitted contracts; no form of irregular work shall be tolerated. When the work contract is established the person shall receive detailed information regarding: –      characteristics of the function and the duties to perform –      normative and remuneration elements –      rules and procedures to adopt in order to avoid possible risks for health associated with work activity.
Personnel management	The Organisation agrees to protect the moral integrity of people, ensuring the right to working conditions respectful of their dignity. Everyone needs to be treated with the same respect and dignity and has the right to the same possibilities of professional and career development. The Organisation prevents any form of discrimination towards its personnel. Within the area of personnel management and development processes, as well as in the selection phase, the decisions taken are based on the correspondence between expected profiles and the profiles possessed by the people (for example, assignment of incentives based on achieved results). Access to positions and assignments is performed based on skills and abilities; in addition, compatibly with the general efficiency of work, priority is given to forms of flexibility in work organisation which supports people in maternity status, as well as those who need to take care of children. The assessment of personnel is performed as much as possible in an enlarged manner, involving the managers, personnel function and, where possible, the subjects who have had contacts with the examined person.
Integrity and protection of the person	The Organisation protects the workers from acts of psychological violence, and contrasts any discriminatory attitude or behaviour, or that can disturb the person’s sensitivity. Achieving individual objectives must be assessed fairly, establishing clearly stated criteria, to use to assess the capacity of the people and their contribution; the achieved results must be adequately recognised. People who believe they have been the object of molestation, or have been discriminated for motives connected to age, sexuality, race, health status, nationality, political opinions, religious beliefs, or similar, can report the incident, as well as to their contacts. Differences are not considered discrimination if justified, or justifiable, based on objective criteria.
Dissemination of personnel policies	Personnel management and work organisation policies are made available to all people, through company instruments (for example email, organisational documents and communications handled by managers).
Promotion and training of resources	Managers shall use and fully promote all professional figures present in the structure, by activating the levers available for promoting the development and growth of people: for example shadowing expert personnel, experience aimed at covering jobs with greater responsibility and training courses. Training is assigned to groups or single people, based on specific professional development needs; in addition, in terms of any remote training (delivered through Internet, Intranet or CD), if activated and not directly assigned, each person may use it, based on their specific interests, outside of normal working hours.
Involvement of people	The involvement of personnel in performing work is ensured, including through times of participation in discussions and decisions functional for achieving company objectives.
Intervention on work organisation	In the event of work reorganisation, the value of human resources is protected by including, where necessary, training and/or professional requalification actions. Therefore the organisation follows the criteria below: –      the burdens of work reorganisation must be distributed as uniformly as possible between all the people, consistently with effective and efficient conducting of the activity –      in case of new or unexpected events, which at any rate must be stated, the person may be assigned to other jobs, compared to those previously performed, making sure to safeguard his or her professional expertise, where possible.
Health and safety	The Organisation is committed to offering a work environment able to protect the health and safety of its personnel. The Organisation agrees to disseminate and consolidate a culture of safety, by developing the awareness of risks and promoting responsible behaviour by all persons; moreover, the Organisation shall work to preserve, above all with preventive actions, the health and safety of workers, independent contractors and third parties. All of the people must respect the internal rules and procedures, concerning risks and protection, of health and safety, and promptly report any shortcomings or failure to comply with the applicable rules. Particular attention is dedicated to training and education related to risks and mitigation measures concerning occupational health and safety.
Protection of privacy	The Organisation follows the provisions contained in Italian Legislative Decree no. 196/2003 for processing the personal data of its personnel. Personnel are provided with a personal data protection policy that identifies: proposes and procedures for processing, any subjects to whom the data is communicated, as well as information necessary for exercising the right to access as per article 13 of Italian Legislative Decree no. 196/2003. If required by law, people will be asked for their consent for processing their personal data. Any investigation into the ideas, preferences, personal tastes, and in general, private life of employees and independent contractors is excluded, unless connected to the performance of their jobs. Control instruments may be adopted on the use of company means and instruments, in compliance with current laws.

  3.2.  Personnel duties

General principles	The people must act loyally, in order to comply with the obligations signed in the employment contract and the contents of the code of ethics, ensuring the requested performance.
Management of information	The people must know and implement what is contained in company policies in terms of safety of information, to ensure its integrity, confidentiality and availability.
Confidentiality of company information	Company information and know-how must be protected with the maximum confidentiality. The people who are not expressly authorised to respond to questions, or provide material requested by contacts inside or outside the Organisation, shall be required to consult with supervisors and follow the specific instructions given. If it is necessary to process significant, confidential or economic topics, care will be taken to adopt the measures necessary so that the confidentiality is protected, according to the nature of the processed elements. Both during, and after termination of employment with the Organisation, the persons may use the confidential data in their possession exclusively in the interest of the Organisation and never for their own benefit or that of third parties.
Confidential information on third parties	The Organisation’s personnel shall refrain from using unlawful means, in order to acquire confidential information on third party enterprises and organisations.
Conflict of interests	All of the Organisation’s personnel are required to avoid situations where conflicts of interest may occur and to refrain from personally taking advantage of business opportunities that they learn of while performing their functions. In the event that even just one apparent conflict of interest occurs, the person is required to notify his/her contact or the Supervisory Body.
Unlawful remuneration, gifts and representation expenses	The Organisation’s personnel is banned from accepting or receiving any gift, bonus/perk or other gift that can have an influence on actions to take, in performing their job duties. The above cannot be evaded by using third parties. Gifts of a modest value remain allowed (for example Christmas gifts). The Organisation’s people who receive other gifts or benefits, than those of the types allowed, are required to notify their contacts, for the purposes of the actions necessary to undertake, including in relation to communications to third parties on company policy.
Use of company assets	Each person is required to work diligently to protect company assets, through responsible behaviours and in line with the operating procedures prepared to regulate their use, precisely documenting their use. The Organisation reserves the right to prevent distorted uses of its assets and infrastructures, through the use of control systems and risk analysis and prevention, without prejudice to complying with current laws.
Participation in antisocial and criminal activities	The Organisation rejects antisocial and criminal activities and declares its attention not to have any part in such phenomena. The Organisation’s personnel is prohibited from undertaking relations of any type with organisations and elements involved in antisocial and criminal activities, which threaten the company or the life of its citizens. Against demands for extortion, by antisocial and criminal individuals, the people will refute all compromise and shall refrain from distributing cash or other services. Likewise, the Company refuses any activity in illegal fields that regards pornography or even worse child pornography.

  3.3.  Relations with customers  

Impartiality	The Organisation agrees not to arbitrarily discriminate its customers.
Contracts and communications with customers	Contracts and communications to the customers of the Organisation must be: –           compliant with current laws, but not amounting to elusive or incorrect practices –           complete, so as not to neglect any significant element, for the purposes of the customer’s decision

3.4.  Relations with suppliers  

Supplier selection	The purchasing processes are based on the search for the best advantage for the Organisation, granting of equal opportunities to suppliers, as well as loyalty and impartiality: the selection of the suppliers and the settlement of the purchase conditions are based on an objective assessment of the quality and price of the good or service, as well as the guarantee of assistance and promptness, without prejudice to any higher priority assessment criteria identified beforehand. The Organisation reserves the right in any case to ask suppliers for an attestation of the following requirements: –             opportunely documented availability of means, including financial, organisational structure, project capacity and resources, know-how, etc. –             existence and actual implementation, in cases where the Organisation’s specifications require it, of adequate company quality systems –             any certifications required by laws or regulations. –            any additional certifications or demonstrations necessary or opportune in managing the relationship
Integrity and independence in relations	The relations with suppliers, including those concerning financial and consultation contracts, are the subject of constant monitoring by the Organisation. The documents exchanged with suppliers must be opportunely archived: in particular, that of an accounting and/or fiscal, must be retained for the period established by current laws.
Protection of ethical aspects in supplies	With the aim of bringing into line the procurement activity with the adopted ethical principles, the Company may introduce, for special supplies and if it feels opportune, social type requirements. For this purpose, contractual clauses can be inserted in contracts with suppliers that include: –             a self declaration by the supplier, concerning adhesion to specific social obligations: for example, the adoption of measures that ensure workers respect of fundamental rights, principles of equal treatment and no discrimination and protection of under-age work –            the possibility for the Organisation to set up control actions, at the production units or operating sites of the supplier enterprise, in order to verify satisfaction of these requirements.

  3.5.  Relations with the Organisation’s shareholders  

Accounting transparency

In order to ensure transparency and completeness of accounting information, it is necessary that the documentation of facts to report in accounting to support reporting is clear, complete and correct, and that it is archived for any audits. The connected reporting must reflect what is described in the supporting documentation and must specify the methods adopted to determine the economic elements based on valuations.

Meetings of Shareholders

The shareholders’ meetings are a privileged time, for instilling a fruitful dialogue between shareholders and the company bodies (Board of Directors) of the Organisation. The corporate bodies are required to accurately prepare and promptly disseminate the support material necessary for letting the Meeting make decisions in an informed manner. Regular participation of the corporate bodies at shareholders’ meetings is ensured.

3.6.  Relations with Public Administrations The term Public Administration means any person, individual or middleman quantifiable as public official or assigned to public service, who works for the Public Administration, central or peripheral or public supervisory authority, independent authority, community institutions, as well as private concessionaires of a public service.

Correctness and loyalty	The Organisation intends to conduct relations with the Public Administration with the maximum transparency and ethical behaviour: these relations, which must take place in compliance with the current laws, are based on general principles of correctness and fairness, in order not to compromise the integrity of both parties. Personnel shall refrain from any behaviour that may damage the impartiality and autonomy of judgement of the Public Administration. Particular precautions shall be observed related to any call for tender, contract, authorisation, concession and licence procedure as well as for loans from the public (state or UE). If the Organisation has the need to use the professional services of the Public Administration employees, acting as consultants, current laws must be observed.
Presents, gifts and benefits	No person of the Organisation may donate money, or offer economic advantages or other types of benefits to subjects of the Public Administration, for the purpose of obtaining assignments or other personal advantages or for the Organisation. No form of present is allowed that may be interpreted as exceeding normal commercial or courtesy practices or aimed at acquiring favourable treatments in conducting any activity that can be related to the Organisation: in particular, any form of gift to public officials or their families is forbidden, which can influence the independent judgement for the purpose of obtaining more favourable treatment or undue or advantageous services of various nature. The above cannot be evaded by using third parties. At any rate, the Organisation declares to comply with legal rules on the matter. If a person of the Organisation receives, from a member of the Public Administration, explicit or implicit requests for benefits, with the exception of gifts of commercial use or modest value, they shall immediately inform their hierarchical superior or the subject required to be contacted, to adopt the opportune initiatives.
Initiatives with the P.A.	If The Company feels it opportune, it may support programmes of public entities aimed at realising usefulness and benefits for everyone, as well as activities of foundations and associations, again in compliance with current laws and the principles of this code.

3.7  Relations with the collective

Economic relations with political parties, trade unions and associations

The Organisation does not finance parties in Italy or abroad, their representatives or candidates, nor does it sponsor conventions or parties that have an exclusive purpose of political propaganda. The Organisation shall refrain from being subject to any lobbying, direct or indirect, by political exponents. The Organisation shall not make contributions to organisations which may entail a conflict of interest. However, it is possible to cooperate, including financially, with such organisations for specific projects, in compliance with the following conditions: –             clear and documented destination of the resources –            express authorisation by the functions in charge, within the Organisation.

Contributions and sponsorships

The Organisation may agree to requests for contributions limited to proposals made by entities and associations declared non-profit, with regular articles of association and articles of incorporation, which are of a high cultural value or benefit or which involve a high number of citizens. The activity of sponsorship, which can regard social, environmental, sport, performance and art themes, are destined only to events that offer guarantees of quality or for which the Organisation can collaborate on the designing, in order to ensure originality or effectiveness. In the selection of the proposals to participate in, the Organisation shall pay particular attention to every possible personal or company conflict of interest: for example relations with relatives with involved subjects or connections with bodies that may, due to the duties they perform, favour the Organisation’s activity in some way.

3.8  Disclosure of information

External communication

Each communication activity observes the laws, rules, and professional conduct practices and is realised with clarity, transparency and promptness. All form of pressure or acquisition of favouritism attitude by communication medium is forbidden. To ensure completeness and coherent information, the Organisation’s relations with mass-media are reserved exclusively to the assigned functions.

 

6. Operating procedures and decision-making protocols

In order to prevent violations of current laws, as well as the code of ethics, the Company has adopted specific procedures (“Processes”) by all of those who intervene in the operating process, aimed at identifying the subjects responsible for the decision-making and authorising processes and performance of the operations: the single operations need to be performed in the various phases by different subjects, whose expertise and skills are clearly defined and known within the organisation, in order to avoid attributing unlimited or excessive powers to single subjects. All of the Organisation’s actions and operations must have adequate records and it must be possible to verify the decision-making and authorisation process and performance of operations. There must be an adequate documental support for each operation in order to be able to proceed at any time, to perform controls that certify the characteristics and the motivation of the operation and identify who authorised, performed, recorded and checked the same operation.