FLAGWORKS Supplier Code of Conduct:

1. Introduction

Flagworks is committed to a procurement process for goods and services that takes into account sustainable, environmental and ethical considerations. Our suppliers are expected to respect fundamental human rights, and to treat their workers fairly and with respect. They are also expected to strive continually towards minimizing the environmental impact of their operations and the goods and services provided.

Our Supplier Code of Conduct (SCC) sets out the minimum performance standards for suppliers regarding working conditions, labour issues and the environment to support Flagworks' Sustainable Environmental and Ethical Purchasing Policy (SEEPP). The goal of the SEEPP is to ensure that the goods and services purchased by Flagworks are produced according to recognized ethical and environmental standards. Flagworks will apply its SCC as one of the criteria used in its selection of business partners and suppliers for products and services. It is a requirement that all Flagworks' suppliers and their subcontractors / suppliers meet the performance standards within this code.

The SEEPP establishes an avenue whereby complaints of abuses in workplaces that are involved in the manufacture of products or delivery of services purchased by Flagworks can be made to Flagworks and will investigate complaints received, in accordance with a process that it at its sole discretion determines to be appropriate and reasonable. It is the supplier's responsibility to ensure subcontractors are compliant with the SCC. The Flagworks will ensure that suppliers who are not fully in compliance with the policy are provided an opportunity to improve their practices.

2. Compliance Requirements

Flagworks suppliers and their sub-contractors will comply with all national and other applicable laws of the country(ies) of operations or manufacture of products or delivery of services, including, but not limited to, those laws relating to working conditions, human rights, health and safety and the environment. For goods and services produced in Canada, Canadian laws will apply. For goods and services produced outside of Canada, where the provisions of local laws and the SCC address the same issue, the provision that is most stringent will apply.

3. Performance Standards

The following performance standards represent the minimum standards for Flagworks suppliers and subcontractors.

3.1 Working Conditions

3.1.1 Child Labour

For goods and services produced in Canada, suppliers to Flagworks and their subcontractors will comply with all employment standards and related law and legislation in the jurisdiction(s) of production or provision of services with respect to minimum working age and restrictions on the employment of children.

For goods and services produced outside of Canada, Flagworks suppliers and their subcontractors will adhere to the International Labour Organization (ILO) Convention 138. If local minimum wage law stipulates ages for work or mandatory schooling higher than the ILO Convention, the higher age would apply.

Flagworks suppliers and their sub-contractors, outside of Canada will ensure young workers (age 15 - 17) are employed according to protective restrictions prescribed by local laws, in keeping with ILO Convention 182.
All Flagworks suppliers and their subcontractors will ensure that they do not expose children or young workers to situations in or outside of the workplace that are hazardous, unsafe, or unhealthy.

3.1.2 Forced Labour

All Flagworks suppliers and their subcontractors will not:

Use forced, illegal or involuntary prison labour, including indentured or bonded labour, or any form of compulsory labour in the production of goods or services (ILO Conventions 29 and 105).

Require workers to lodge deposits or their identity papers as a condition of employment, or financially penalize workers for resigning.

Require any foreign contract worker to remain in employment for any period of time against his or her will or burden workers with any required agency recruitment commissions.

3.1.3 Disciplinary Practices

All Flagworks suppliers and their subcontractors will treat workers with respect and dignity and ensure workers are not subjected to any form of physical, sexual, psychological or verbal harassment or abuse, coercion or corporal punishment.

3.1.4 Hours of Work

For goods and services produced in Canada, Flagworks suppliers and their subcontractors will comply with all employment standards and related law and legislation in the jurisdiction(s) of production with respect to hours of work, overtime hours and overtime pay.

For goods and services produced outside of Canada, Flagworks suppliers and their subcontractors will ensure regular working hours do not exceed forty eight (48) hours per week, and that the combination of regular hours and required overtime hours do not exceed sixty (60) hours per week except in emergency circumstances.

For goods and services produced outside of Canada, Flagworks suppliers and their subcontractors will ensure that overtime hours are compensated either according to the law, or where the law is silent, at premium rates for hours in excess of forty eight (48) hours and that hours worked in excess of sixty (60) hours per week are on a voluntary basis.

For goods and services produced outside of Canada, Flagworks suppliers and their subcontractors will ensure workers are provided at least one day off during every seven (7) day period.

3.1.5 Remuneration

For goods and services produced in Canada, Flagworks suppliers and their subcontractors will at a minimum meet legislated minimum wage rates and comply with all employment standards and related law and legislation in the jurisdiction(s) of production with respect to compensation, including wages and benefits.

For goods and services produced outside of Canada, Flagworks suppliers and their subcontractors will meet national or international standards, whichever is higher, for wages and benefits within the country of production, irrespective of special status granted to a company, worksite, or geographic area that permits the organization to compromise applicable standards.

For goods and services produced outside of Canada, Flagworks suppliers and their subcontractors will pay workers directly and provide workers with clear, written accounting of hours worked, deductions, and regular and overtime wages in a language they can understand.

For goods and services produced outside of Canada, Flagworks suppliers and their subcontractors will not make direct wage deductions from employee pay as a disciplinary measure. Where an employee is temporarily suspended without pay, infractions must be proven openly and promptly.

Recognizing that wages are essential to meeting workers' basic needs, all Flagworks suppliers and their subcontractors will make every effort to ensure that workers receive wages that exceed legislated minimums that meet basic needs by local standards.

3.2 Human Rights

3.2.1 Freedom of Association

For goods and services produced in Canada, Flagworks suppliers and their subcontractors will comply with the Canadian Charter of Rights and Freedoms right to freedom of association and labour relations law and regulations in the jurisdiction(s) of production.

For goods and services produced outside of Canada, Flagworks suppliers and their sub-contractors will recognize and respect that workers, without distinction, have the right to form or join trade unions of their own choosing and to bargain collectively (ILO Convention 87).

Where the right of freedom of association and collective bargaining is restricted under law, the supplier will not hinder the development of parallel means for independent, free association and bargaining (ILO Convention 98).

Flagworks suppliers and their sub-contractors will ensure that workers representatives are not discriminated against and have reasonable access to carry out their representative functions in the workplace.

3.2.2 Discrimination

For goods and services produced in Canada, Flagworks suppliers and their subcontractors will recognize the fundamental human rights of workers as guaranteed through the Canadian Charter of Rights and Freedoms and corresponding provincial Human Rights law and legislation in the jurisdiction(s) of production.

For goods and services produced in Canada, Flagworks suppliers and subcontractors will be recognized for their use of employment practices that support a diverse workforce.
All Flagworks suppliers and their subcontractors will consider employees for positions and promotions on the basis of their qualifications and abilities. All Flagworks suppliers and their subcontractors will not unlawfully discriminate on the basis of race, gender, political or religious beliefs, social, ethnic or national origin, marital status, union affiliation, sexual orientation, or disability (ILO Conventions 100 & 111).

All Flagworks suppliers and their subcontractors will not interfere with the exercise of the rights of personnel to observe tenets or practices, or to meet needs relating to race, caste, national origin, religion, disability, gender, sexual orientation, union membership or political affiliation.

All Flagworks suppliers and their subcontractors will not allow behaviour including gestures, language and physical contact, that is sexually coercive, threatening, abusive or exploitative.

3.3 Health and Safety

For goods and services produced in Canada, Flagworks suppliers and their subcontractors will comply with all occupational health and safety codes and related law and regulations in the jurisdiction(s) of production

For goods and services produced outside of Canada, Flagworks suppliers and their subcontractors will:

• Provide a safe and healthy working environment and take adequate steps to prevent accidents and injury to health arising out of, associated with or occurring in the course of work by minimizing, so far as is reasonably practicable, the causes of hazards inherent in the working environment;
• Appoint a representative responsible for the health and safety of all personnel, and accountable for the implementation of the Health and Safety elements identified in this Code of Conduct;
• Ensure that all personnel receive regular and recorded health and safety training (in a language understood by the worker) and that such training is repeated for new and reassigned personnel;
• Establish systems to detect, avoid or respond to potential threats to the health and safety of all personnel;
• Provide for use by all personnel, clean bathrooms, access to potable water and, if appropriate, sanitary facilities for food storage.

All Flagworks suppliers and their subcontractors will ensure that, if provided for personnel, dormitory facilities are clean, safe, and meet the basic needs of the personnel.

3.4 Environment

Suppliers to Flagworks and subcontractors will ensure that in the provision of products and services, adverse effects on the community, environment and natural resources are to be minimized while safeguarding the health and safety of the public. Minimum environmental standards for suppliers and subcontractors are:

3.4.1 Environmental Permits and Reporting

All required environmental permits and registrations are to be obtained, maintained and kept current and their operational and reporting requirements are to be followed.

3.4.2 Pollution Prevention and Resource Reduction

Waste of all types, including water and energy, are to be reduced or eliminated at the source or by practices such as modifying production, maintenance and facility processes, materials substitution, conservation, recycling and re-using materials.

3.4.3 Hazardous Substances

Materials posing a hazard if released to the environment are to be identified and managed to ensure their safe handling, movement, storage, recycling or re-use and disposal.

3.4.4 Wastewater and solid waste

Wastewater and solid waste are to be monitored, controlled and treated as required prior to discharge or disposal.

3.4.5 Air emissions

Air emissions of volatile organic chemicals, aerosols, corrosives, particulates, ozone-depleting chemicals and combustion by-products generated from operations are to be characterized, monitored, controlled and treated as required prior to discharge.

3.4.6 Product Content Restrictions

Suppliers to Flagworks are to adhere to all applicable laws and regulations regarding prohibition or restriction of specific substances including labeling laws and regulations for recycling and disposal.

4. Compliance and Implementation

Flagworks expects all its suppliers to comply with the SCC and to actively do their best to exceeds FLAGWORK'S standards. Flagworks believes in cooperation and is willing to work with its suppliers to improve performance where necessary.

All Flagworks suppliers and their subcontractors have an obligation to inform their employees about the Supplier Code of Conduct and appropriate avenues of complaint. This Code of Conduct shall be communicated to all employees and posted in both English and the local language of the employees, in an area accessible to all employees.

Flagworks will require that suppliers provide details on factory and production facility locations.

Flagworks reserves the right to ask for proof of compliance with all applicable labour, health, safety and environmental laws, and may inspect work locations at any time (or request independent verification of compliance). Suppliers must maintain current and sufficiently detailed records to substantiate their compliance with the SCC and Flagworks may ask that they are independently verified at the supplier's expense.