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California Transparency in Supply Chains Act

Effective January 1, 2012, the California Transparency in Supply Chains Act of 2010 (SB 657) will require companies that sell goods in California to make certain disclosures regarding their efforts to address slavery and human trafficking. The law is primarily intended to ensure consumers have access to detailed information about the human rights practices behind the production of goods that they buy, to assist in buying decisions. Fruit of the Loom, Inc. and our global affiliates, have a strong, comprehensive social compliance program, with a progressive Code of Conduct that includes third party monitoring. We do not tolerate human rights abuses of any kind.

Our company’s Code of Conduct, available here, reflects our core operating principles, emphasizing respect for people and adherence to laws and ethical standards. We believe that workers at our facilities and our suppliers’ facilities have the right to freely choose employment, and the right to a workplace free from abuse, harassment and unlawful discrimination.

Slavery and human trafficking can take many forms, including child labor and forced labor. To ensure we only do business with firms that share our principles, we screen contractors and use independent third party monitoring firms to conduct extensive assessments throughout our supply chain. Specifically, our program includes:

Supplier Screenings

As part of our contractor selection process, the company performs preliminary screenings to identify areas of risk and weaknesses in social compliance policies and practices.

Supplier Verification and Audits

Our verification and assessment program is designed to evaluate suppliers’ compliance with our Code of Conduct on an annual basis through the use of onsite assessments conducted by third party monitoring firms. In addition to the annual assessments, the Fair Labor Association conducts assessments of a sampling of our facilities throughout the year. A finding of noncompliance with our Code of Conduct and other assessment criteria relating to forced labor or child labor may be based on a supplier’s failure to adequately document compliance, even if no actual forced labor or child labor violation has occurred. An audit that discloses serious violations or weaknesses in a supplier’s policy or practices regarding forced labor and child labor may lead to suspension or termination of our business with the supplier. We have zero tolerance for forced labor and child labor. If any such practices are revealed in assessments, we require suppliers to rectify the problem, and, if they fail to do so, we immediately terminate the business relationship for a period of no less than 12 months.

Internal Accountability Standards and Corrective Action Plans

Following assessments, suppliers are required to complete corrective action plans, which are subject to our review and approval. These plans outline how a supplier intends to resolve and prevent future occurrence of issues revealed in assessments. As appropriate, our assessors conduct a follow-up assessment at the facility to check progress on the corrective action plan and confirm resolution of any child labor or forced labor issues.

Supplier Agreements

Our supplier and contractor agreements and purchase order terms require compliance with international standards and applicable laws and regulations regarding forced labor and child labor, as specified in our Code of Conduct.

Our Partners

We collaborate with a number of nongovernmental organizations (NGOs) to raise awareness of social compliance issues, particularly child labor and forced labor matters. We regularly monitor reports and follow the developments of leading NGOs in this field, such as the Fair Labor Association, International Labor Organization/International Finance Corporation, Better Work Program, FUNDAHRSE and Fundemas.

Material Certification

As a part of supplier screenings, our authorized suppliers of components and our manufacturing contractors are required to sign a contract that commits them to adhere to our Code of Conduct, including its prohibitions on the use of Forced Labor, and to sign separate Acknowledgments that they understand and will comply with same. Each partner producing cotton apparel for the company is required to sign a statement confirming Uzbekistan cotton was not used in production of our goods. The United States Department of State has identified the widespread use of forced labor and child labor in the cotton sector of that country.

Training and Awareness

Our Code of Conduct specifically prohibits forced labor, slave labor and human trafficking, and is distributed annually to employees and contractors. Our Code of Conduct is translated into the local language(s) and any language(s) that make up 10% of the workforce in supplier facilities. Our contractors are required to read and post our Code of Conduct and provide training to their employees. Compliance with these requirements are verified during third party assessments. Our third party monitors are experts in recognizing and detecting forced labor, slave labor and human trafficking practices and conditions.