Expected Ethical and Business Standards

Hudson's Bay Company (Hbc) fully intends to conduct its business in a socially responsible manner and we are determined to build our business with our business partners and their employees based on the highest ethical principles of trust, teamwork, honesty, and respect for the rights and dignity of others. We require our business partners and their employees to endorse a set of ethical standards compatible with our own and encourage and favour those who fully conform to standards of business practices that are consistent with our principles. We will only engage business partners who demonstrate a commitment to contribute to the improvement of community working conditions and strive to meet our requirements stated in this Code.

Legal Expectations

All business partners and their employees must comply with all contract provisions, legal requirements and standards of their industry under local, regional and national laws and regulations of the countries in which the business partners are doing business. Should the legal requirements and the standards of the industry conflict, business partners and their employees must comply with the higher standard in the country in which the products are manufactured. Nothing in this Code is to be construed as encouraging, authorizing or condoning any action by any company or individual that breeches any applicable law or regulation, directly or otherwise. By extension, the provisions of this Code are not to be read as creating or implying meanings beyond those specifically explained in this document.

Employment Standards

No Forced Labour

Business Partners must maintain employment on a voluntary basis respecting the right of employees to decide to work or not. Business Partners shall not use forced labour, whether in the form of prison labour, indentured labour, bonded labour or otherwise in the manufacture or in their contracting, subcontracting or other relationships for the manufacture of their products.

No Child Labour

The use of child labour is not permissible. Workers can be no less than age 15 (or 14 where the law of the country of manufacture allows), or the age at which compulsory schooling has ended, whichever is greater. In situations involving hazardous working conditions, we require that workers are at least 18 years of age. We support the development of legitimate workplace apprenticeship programs for the educational benefit of younger people as long as they are not

being exploited or given jobs that are dangerous to the child's health or safety. No child or younger person of compulsory school age should be employed during school hours and the combined time spent on school, transportation, and at work cannot exceed 10 hours a day.

No Harassment Or Abuse

We require that every employee shall be treated with respect and dignity. No employee shall be subject to any physical, sexual, psychological or verbal harassment or abuse including the use of corporal punishment.

Freedom Of Association and Collective Bargaining

Management practices must respect the right of employees to free association and collective bargaining where applicable.

No Discrimination

Hbc recognizes and respects the cultural differences found in the world. We will favour Business Partners who ensure that no employee shall be subject to any discrimination in employment, including hiring, salary, benefits, advancement, discipline, termination or retirement, on the basis of gender, race, religion, age (other than normal hiring or retirement limitations), disability, sexual orientation, nationality, political opinion, union participation, social or ethnic origin or membership in any legal organization. Employment decisions will be made on the basis of knowledge, skill, efficiency and ability to do the job and meet its requirements.

Health and Safety

Hbc will only utilize Business Partners who provide safe and healthy work environments for their employees. Factories producing Hbc merchandise shall provide adequate first aid supplies, fire exits and safety equipment, well-lit workstations, clean restrooms and ensure that all are well maintained and in good working order. Worker housing, where provided by the Business Partner, must meet a reasonable standard of health and safety.

Wages and Benefits

Hbc will seek Business Partners who share our commitment to the betterment of wage and benefit levels that address the basic needs of workers and their families so far as possible and appropriate in light of national economic conditions. Business Partners are required to pay the higher of, the prevailing industry wage, the minimum wage, or a wage that results in a decent living. Business partners shall provide all legally mandated benefits.

Hours of Work/Overtime

Business Partners shall maintain reasonable employee work hours in compliance with local standards and applicable national laws of the countries in which Business Partners are doing

business. In the absence of exceptional circumstances, Hbc will favour Business Partners who utilize less than a sixty-hour work-week and not those who, on a regularly scheduled basis, require employees to work in excess of a sixty-hour work- week. Where this is not established at a lower level by local laws, Hbc defines a standard work week to be not more than 48 hours and considers all hours in excess of this amount to be overtime, whether mandatory or not. Business Partners are required to compensate employees for overtime hours including such premium rates as are legally required in the country of manufacture, or in those countries where such laws do not exist, at a rate at least equal to their regular hourly compensation rate. Unless exceptional circumstances exist, employees should be permitted at least one day off in every seven-day period, and leave privileges.

Resolution Of Disputes

Business Partners should incorporate a dispute resolution process as part of their management practices to allow employees to voice workplace grievances without the fear of reprisal.

Environmental Requirements

Hbc will favour Business Partners who conduct their business using progressive environmental practices and take active steps to preserve and protect the well-being of the environment. All Business Partners must adhere to all applicable environmental laws and regulations regarding protection and preservation of the environment in their country.

Transshipment

Vendors will comply with applicable customs importing laws, and in particular, will establish and maintain programs and documentation to support country-of-origin production verification, to prevent illegal transshipping of merchandise.