Koninklijke Ahold Delhaize N.V. and its subsidiaries (together hereinafter to be referred to as “Ahold Delhaize”) are committed to offering high quality products at a good value to their millions of customers. As part of its Sustainable Retailing Program, Ahold Delhaize and each of its local Brands are also committed to (i) complying with all applicable laws and regulations in each of the countries in which they operate, (ii) ensuring that the parties that supply Ahold Delhaize with goods and services (each a “Supplier”) do the same, (iii) validating the origin of goods offered for sale by Ahold Delhaize, and (iv) maintaining a high standard of business ethics and regard for human rights throughout their supply chain. These Standards of Engagement (each a “Standard”) set minimum standards for Suppliers that are designed to ensure that Ahold Delhaize has visibility into all aspects of its supply chain and meets these objectives. In connection with the foregoing, each of Ahold Delhaize’s Suppliers agrees to the following:

Definition:

‘Subcontractor’ - The entity appointed by the Supplier to produce final consumer products.

1. Observing all applicable laws and regulations

Suppliers must observe all applicable laws and regulations of their country of operation, including laws relating to employment, discrimination, the environment, and safety and health. In countries where local laws and regulations are in conflict with these Standards, Suppliers should seek ways to abide by the principles that provide the highest protection to the workers and environment while complying with applicable laws and regulations.  Suppliers must also comply with applicable national laws relating to the import of products, including country of origin labeling, product labeling, and product testing, in addition to all contractual requirements

2. Observing and conforming to BSCI Code of Conduct

We require our Suppliers to abide by the principles set out in these Standards, irrespective of location. Suppliers sourcing from risk countries on the BSCI ‘country risk classification’[1] must observe and conform to the BSCI Code of Conduct or an equivalent standard acceptable to Ahold Delhaize and may be required to demonstrate compliance with such standard in the form of a valid audit report or certificate (depending on the provisions of the standard).

[1] http://www.bsci-intl.org/resource/countries-risk-classification

3. Employment Matters

Suppliers must treat all employees fairly and with dignity, and must observe the following specific requirements:

3.1 Legal Right to Collective Bargaining

The legal rights of personnel to form and join trade unions of their choice and to bargain collectively shall be respected.

3.2 Prohibition of Discrimination

No discrimination shall be tolerated in hiring, remuneration, access to training, promotion, termination or retirement based on gender, age, religion, race, caste, social background, disability, ethnic and national origin, nationality, membership in workers’ organizations including unions, political affiliation, sexual orientation, or any other personal characteristic protected by law. No employee shall be subjected to any physical, sexual, psychological or verbal harassment.

3.3 Compensation

Employees shall be paid in compliance with all applicable legal requirements and reflecting the time worked. Wages paid for regular working hours, overtime hours and overtime differentials shall meet or exceed applicable legal minimums. Illegal deductions from wages shall not be made. Deductions for disciplinary purposes from wages for time worked are forbidden. Partial payment in the form of allowance “in kind” is accepted in line with International Labor Organization (ILO) specifications. Suppliers shall ensure that wage and benefits composition are detailed clearly and regularly for workers; the Supplier shall also ensure that wages and benefits are rendered in full compliance with all applicable laws and that remuneration is rendered in a manner convenient to workers.

3.4 Working Hours

The Supplier shall comply with all applicable laws on working hours, including maximum allowable working hours and days, and payment for overtime hours at a premium rate.

3.5 Workplace Health and Safety

Suppliers shall adhere to all applicable laws and regulations on occupational health and safety. A clear set of procedures must be established and followed regarding occupational health and safety, including the provision and use of personal protective equipment, clean toilets, access to potable water and, if appropriate, sanitary facilities for food storage shall be provided. Employees shall receive adequate training to ensure that they can perform their duties in a safe manner. Workplace practice and conditions and conditions in residential facilities provided by the Supplier which violate basic human rights are forbidden.

3.6 No Child Labor

Suppliers shall not employ directly or indirectly, children below the minimum age of completion of compulsory schooling as defined by law, which shall not be less than 15 years, unless the exceptions recognized by the ILO apply.[1]  Any forms of exploitation of children are forbidden. Working conditions resembling slavery or harmful to children’s health are forbidden. Suppliers must establish robust age-verification mechanisms as part of the recruitment process, which may not be in any way degrading or disrespectful to the worker. This principle aims to protect children from any form of exploitation.

[1] http://www.ilo.org/global/lang--en/index.htm

3.7 Protect the rights of Young Workers

The rights of young workers (under 18) must be protected. Suppliers shall ensure that young persons do not work throughout the night and that they are protected against conditions of work which are prejudicial to their health, safety, morals and development.

3.8 No Precarious Employment

Suppliers shall ensure that (a) their employment relationships do not cause insecurity and social or economic vulnerability for their workers; (b) work is performed on the basis of a recognized and documented employment relationship, established in compliance with applicable legislation or, in the absence of applicable legislation, custom, practice or international labor standards.

3.9 No Bonded Labor

Suppliers shall not engage in any form of forced, bonded, or trafficked labor. Suppliers will risk allegations of complicity if they benefit from the use of such forms of labor by their business partners. Suppliers shall act with special diligence when engaging and recruiting migrant workers both directly and indirectly. Suppliers shall ensure that workers are not subject to inhumane or degrading treatment, corporal punishment, mental or physical coercion and/or verbal abuse.

4. Environment and Safety Issues

Suppliers shall take the necessary measures to avoid environmental degradation. Suppliers should assess significant environmental impact of operations, and establish effective policies and procedures that reflect their environmental responsibility and meet or exceed legal requirements.

5. Cooperation, providing information and access

Suppliers are required to inform Ahold Delhaize of (i) (changes of) the location of their operations or any information relevant thereto, and (ii) (changes of) the location of operations of their subcontractors involved in the production process or any information relevant thereto. Suppliers must also provide information and access necessary for Ahold Delhaize to establish effective oversight of the business practices employed by its Suppliers and to monitor compliance with these Standards of Engagement.

6. Subcontracting

If a Supplier hires a subcontractor in connection with providing goods or services to Ahold Delhaize, the Supplier shall cause the subcontractor to comply with these Standards of Engagement as if Ahold Delhaize entered into an agreement with the subcontractor directly.

7. Consequence of termination

If a Supplier fails to comply with the requirements of these Standards, the Supplier must take corrective actions without delay. Ahold Delhaize shall determine whether such actions as well as the timing for their implementation are adequate and sufficient to correct the non-compliance with these Standards. If a Supplier fails to comply with the requirements of these Standards, the Supplier will be in material breach of any agreements or contracts that it may have with Ahold Delhaize, and Ahold Delhaize will have all rights under such contracts to terminate the agreements or contracts. Ahold Delhaize reserves the right to immediately terminate its relationship with any Supplier in the event of violations of these Standards by such Supplier or any of its subcontractors involved in the provision of services to Ahold Delhaize or production of products purchased by Ahold Delhaize, including with respect to the prohibitions on child labor, bonded labor, and life-threatening occupational health and safety violations. If Ahold Delhaize terminates its relationship (including one or more of its contracts) with a Supplier due to the fact that such Supplier or any of its subcontractors involved in the provision of services or production process of products fails to meet the requirements of these Standards, no damages shall be payable by Ahold Delhaize in connection with such termination.

8. Observing Ethical Business Behavior

Suppliers observe ethical business behavior when they take the necessary measures to avoid any act of corruption, extortion or embezzlement, nor engage in any form of bribery - including but not limited to - the promising, offering, giving or accepting of any improper monetary or other incentive. Suppliers are expected to keep accurate records regarding their activities, structure and performance, and should disclose these in accordance with applicable regulations and industry benchmark practices. Suppliers should neither participate in falsifying such information, nor in any act of misrepresentation in the supply chain.

9. Grievance mechanism

Suppliers are expected to establish adequate complaint mechanisms for employees who believe they have been mistreated, and to ensure no retaliation against employees who raise complaints in good faith.

10. Mandatory law exception

In the event that mandatory law in a specific market precludes the application of one or more of these Standards in a specific supply relationship, Ahold Delhaize and the relevant Supplier will redefine the Standard such that it comes as close as possible to the original Standard without contravening the relevant mandatory law. All other Standards shall remain in full force and effect.