TABLE OF CONTENTS

I INTRODUCTION 4

II OVERVIEW OF GENERAL ILS PROGRAM REQUIREMENTS 5

III DISNEY CODE OF CONDUCT FOR MANUFACTURERS AND 7

THE MINIMUM COMPLIANCE STANDARD

IV SOURCING RESTRICTIONS 10

V FACILITY DECLARATION AND AUTHORIZATION 12

VI ILS AUDITS 17

VII REMEDIATION OF NONCOMPLIANCE 25

VIII FACILITY LOSS OF PRODUCTION AUTHORIZATION 27

IX DISCLOSURE OF ILS AUDITS AND FACILITIES 29

X DISNEY’S ILS ETHICS POLICY 30

APPENDIX 32

A1 APPENDIX 1: Glossary of Terms 33

A2 APPENDIX 2: Frequently Asked Questions 35

A3 APPENDIX 3: Disney Code of Conduct for Manufacturers 39

A4 APPENDIX 4: Examples of Minimum Compliance Standard (MCS) Violations 41

A5 APPENDIX 5: Social Compliance Monitoring Organizations 43

A6 APPENDIX 6: Reference List of Social Compliance Consultants 45

A7 APPENDIX 7: Better Work Program Participation and Instructions 47

A8 APPENDIX 8: Permitted Sourcing Countries (PSC) 49

A9 APPENDIX 9: Facility and Merchandise Authorization (FAMA) Application 51

A10 APPENDIX 10: Sample Facility and Merchandise Authorization (FAMA) 53

A11 APPENDIX 11: Sample Code of Conduct Assessment Notification (COCAN) 54

A12 APPENDIX 12: Sample ILS Audit Agenda 55

A13 APPENDIX 13: Sample ILS Audit Records Checklist 56

A14 APPENDIX 14: Sample Corrective Action Plan 60

A15 APPENDIX 15: Sample Facility Loss of Production Authorization Letter 61

A16 APPENDIX 16: Sample Monthly Status Report 62

A17 APPENDIX 17: Sample FAMA Revocation Letter 64

A18 APPENDIX 18: Sample FAMA Revocation­—UTS Letter (Unable to Schedule) 65

2
IX DISCLOSURE OF ILS AUDITS AND FACILITIES

IX. DISCLOSURE OF ILS AUDITS

AND FACILITIES
Disney may disclose any ILS Audit Report to third parties (including other Licensees and
Vendors of Disney using the same Facility, Social Compliance Monitoring Organizations
representing Disney and nongovernmental organizations) (collectively “Third Parties”) but
will not reference the identity of the Licensee or Vendor in such disclosure without the prior
written consent of the Licensee or Vendor.

You as a Licensee or Vendor may disclose ILS Audit Reports from ILS Audits conducted by or on your behalf
to Third Parties. However, you may not reference Disney or any of Disney’s intellectual properties or products
without the prior written consent of Disney.

In connection with the ILS Program, Disney may disclose publicly or to Third Parties the names and addresses of
any and all Facilities without the consent of Licensees and Vendors.

As part of its anti-piracy efforts, and/or to facilitate shipping, Disney may communicate with, and provide
information to, customs and law enforcement officials globally and/or other Third Parties that may assist with
such efforts in order to identify authorized users of intellectual properties owned or controlled by Disney,
including the identification of Licensees and Vendors, the Facilities, and other information found in the Facility
and Merchandise Authorization (“FAMA”) Application.

Disney may disclose any and all ILS Audit Reports, FAMA Applications, and other information as Disney deems
necessary to enforce its contractual rights and/or protect its intellectual property rights.

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X DISNEY’S ILS ETHICS POLICY

X. DISNEY’S ILS ETHICS POLICY

All employees of The Walt Disney Company and its affiliated companies (collectively “Disney”)
are required to comply with certain ethical and legal standards set forth in the “Ethical Conduct”
section of Disney’s website. Disney follows these standards in its daily operations worldwide.

In addition, Disney requires that social compliance monitors and others that Disney commissions
(collectively “Disney representatives”) adhere to the same standards. Among other things, these standards
strictly prohibit the solicitation, offer, or acceptance of anything of value from any person or company that
may impair or be presumed to impair the exercise by any Disney representative of independent judgment
and unbiased assessment.

Furthermore, no individual or company may offer anything of value that is intended, or that may
reasonably appear to be intended, to influence any Disney representative. This includes, but is not limited to:

• Any cash, gratuity, benefit, discount, special privilege, loan, lodging, or other favor.
• Any meals and travel other than as reasonably necessary and incidental to a Disney
representative’s work.

Any individual or company attempting to influence a Disney representative is subject to having its contract to
manufacture Disney products terminated immediately.

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 X DISNEY’S ILS ETHICS POLICY

If you have any concerns or questions regarding the behavior of any Disney representative, or if you want to report a
violation of the ethics policy, please immediately contact the Disney Hotline in your region at the number listed below:

COUNTRY HOTLINE TELEPHONE NUMBER COUNTRY HOTLINE TELEPHONE NUMBER

ARGENTINA 0800-666-1676 00798-1-1-005-8393 (KOREAN TELECOM);

KOREA 0308-1-10492 (DACOM);
AUSTRALIA 1-800-20-8921 (OPTUS); 1-800-14-0796 (TELSTRA) 00368-11-0099 (ONSE)
AUSTRIA AT&T: 0800-200-288; Guideline: 800-699-4870 LUXEMBOURG AT&T: 800-2-0111-352; Guideline: 800-699-4870

BELGIUM Report to local HR MEXICO 001-800-620-1445

BRAZIL 0800-891-4137 NETHERLANDS Guideline: 0800-4444-002

CANADA 1-800-699-4870 NEW ZEALAND 704-973-0301; Ask to reverse charges

CHILE 1230-020-2093 NORWAY AT&T: 800-190-11; Guideline: 47-800-699-4870

CHINA 10-400-888-0347 POLAND Direct Dial Guideline: 0-0-800-111-1986

CZECH REPUBLIC Direct Dial Guideline: 800-143-385 PORTUGAL AT&T: 800-800-128; Guideline: 800-699-4870

DENMARK AT&T: 8001-0010; Guideline: 800-699-4870 RUSSIA AT&T: 363-2400 (Moscow); Guideline: 800-699-4870

DUBAI AT&T: 8000-021; Guideline: 800-699-4870 SINGAPORE 704-973-0301; Ask to reverse charges

FINLAND AT&T: 0-8001-10015; Guideline: 800-699-4870 SOUTH AFRICA Direct Dial Guideline: 0800-99-9673

FRANCE Direct Dial Guideline: 0800-90-6152 SPAIN Direct Dial Guideline: 900-97-1014

GERMANY Direct Dial Guideline: 0800-180-7608 SWEDEN AT&T: 020-799-111; Guideline: 800-699-4870

GREECE AT&T: 00-800-1311; Guideline: 800-699-4870 SWITZERLAND AT&T: 0-800-890011; Guideline: 800-699-4870

HONG KONG 800-90-1454 TAIWAN 704-973-0301; Ask to reverse charges

HUNGARY Direct Dial Guideline: 06-800-20-140 TURKEY AT&T: 0811-288-0001; Guideline: 800-699-4870
Dial AT&T direct code: 000-117 after hearing a tone, UNITED KINGDOM Direct Dial Guideline: 0808-234-6062
INDIA
dial: 800-699-4870
UNITED STATES 1-800-699-4870
IRELAND AT&T: 1-800-550-000; Guideline: 353-800-699-4870
Dial AT&T direct code: 0-800-552-6288 after hearing a
ISRAEL Direct Dial Guideline: 180-941-9858 VENEZUELA
tone, dial: 800-699-4870
ITALY Direct Dial Guideline: 800-787634
00531-11-5136 (KDDI); 0066-33-830169 and
JAPAN 0044-22-112725 (SOFTBANK);
0034-800-900267 (NTT)

The hotline may be called any time, day or night—it is available 24 hours a day, 365 days a year. Disney strictly prohibits any form of
retaliation against anyone who reports any suspected wrongful conduct to the Walt Disney Company. Reports are also accepted
anonymously. Disney will use reasonable efforts to maintain the confidentiality of any report, although it must retain the right to
make disclosures that it deems required by law or otherwise necessary for the protection of the ILS Program or other Disney rights
and interests.

31
 A PPENDI X

A1 APPENDIX 1: Glossary of Terms 33

A2 APPENDIX 2: Frequently Asked Questions 35

A3 APPENDIX 3: Disney Code of Conduct for Manufacturers 39

A4 APPENDIX 4: Examples of Minimum Compliance Standard (MCS) Violations 41

A5 APPENDIX 5: Social Compliance Monitoring Organizations 43

A6 APPENDIX 6: Reference List of Social Compliance Consultants 45

A7 APPENDIX 7: Better Work Program Participation and Instructions 47

A8 APPENDIX 8: Permitted Sourcing Countries (PSC) 49

A9 APPENDIX 9: Facility and Merchandise Authorization (FAMA) Application 51

A10 APPENDIX 10: Sample Facility and Merchandise Authorization (FAMA) 53

A11 APPENDIX 11: Sample Code of Conduct Assessment Notification (COCAN) 54

A12 APPENDIX 12: Sample ILS Audit Agenda 55

A13 APPENDIX 13: Sample ILS Audit Records Checklist 56

A14 APPENDIX 14: Sample Corrective Action Plan 60

A15 APPENDIX 15: Sample Facility Loss of Production Authorization Letter 61

A16 APPENDIX 16: Sample Monthly Status Report 62

A17 APPENDIX 17: Sample FAMA Revocation Letter 64

A18 APPENDIX 18: Sample FAMA Revocation–UTS Letter (Unable to Schedule) 65

A1 GLOSSARY OF TERMS

APPENDIX 1

GL O S S A RY OF T ER M S
B L A N K I T E M S means blank or generic products, components or materials that do not contain, incorporate or
apply any Disney intellectual property (such as blank or generic cardboard boxes, plastic wrap or plain buttons).

CO D E means (i) the Code of Conduct for Manufacturers adopted by The Walt Disney Company and its
Affiliates (“Disney Code”), or (ii) another set of labor standards agreed to by Disney in its absolute discretion.
Disney’s Code is posted on the ILS Website.

FAC I L I T Y means any of Licensee’s or Vendor’s own or third-party manufacturers, vendors, factories, farms,
suppliers, and other facilities (as well as any subcontractors) that produce, process, finish, assemble (including
without limitation, the combination of one (1) or more individual products together into a separate product
set, bundle or multi-pack), or package products, components of products, product packaging, promotional
premiums, or other items related thereto, in each case in physical form (i.e., not in digital form only), that contain,
incorporate or apply any Disney intellectual property (i.e., any names, marks, logos, characters, artwork or other
proprietary material owned or controlled by The Walt Disney Company or any of its affiliated companies), all of
which are referred to as “Disney-branded products”.

FA M A A P P L I C AT I O N means the most current version of a Facility and Merchandise Authorization Application
(found on the ILS Website or another website used by Disney) which Licensee or Vendors must complete and
submit to Disney for each Facility.

I L S AU D I T means a labor standards inspection and/or audit of a Facility used to assess whether the Facility
complies with the ILS Minimum Compliance Standard, the Disney Code and Laws.

I L S W E B S I T E means www.DisneyLaborStandards.com (or any successor website).

L AW(S ) means applicable laws, rules and regulations, including without limitation, local and national laws,
rules and regulations, treaties, and other legal obligations pertaining to your agreement with Disney with
respect to Disney-branded products and to any of your activities under your agreement with Disney with
respect to Disney-branded products, including without limitation, those applicable to (i) any tax, (ii) consumer
and/or product safety, (iii) data privacy and the privacy and protection of personally identifiable information,
(iv) the protection of minors, employees, and the environment, (v) the United States Foreign Corrupt Practices
Act of 1977 and any amendments thereto (and any local or foreign equivalent), (vi) trade restrictions (e.g.,
customs, export and import controls, sanctions and embargoes) including United States trade restrictions,
and (vii) the manufacture, labeling, pricing, sale or distribution of Disney-branded products.

M I N I M U M CO M P L I A N C E S TA N DA R D means the minimally acceptable level of compliance with the Disney

Code as required by the ILS Program and as evidenced by (i) the absence of any (a) child labor, (b) involuntary
labor, (c) coercion and/or harassment, (d) discrimination, (e) serious health and safety workplace violations,
(f) interference with freedom of association, and (g) unauthorized subcontracting, and (ii) the provision of
all information necessary to assess compliance with the Disney Code and pertinent Laws (e.g., complete and
accurate records, and access to Facility personnel and premises).

33
A1 GLOSSARY OF TERMS

P E R M I T T E D S O U R C I N G CO U N T R I E S O R “ P S C ” means those countries specified by Disney

in or from which Licensees and Vendors may manufacture or source products, components of products, product
packaging, promotional premiums (including without limitation, raw materials and blank items). Disney may
establish additional requirements as a condition to conducting any of the foregoing activities in certain Permitted
Sourcing Countries. The current list of Permitted Sourcing Countries is posted on the ILS Website and included in
this ILS Program Manual.

P E R S O N means any individual or form of legal entity.

P R O H I B I T E D P E R S O N S means those Persons with whom a Licensee or Vendor may not conduct business by
Law. If a Person becomes prohibited by Law, the prohibition shall be automatic as of the effective date of such
Law without need of any notice from Disney. It is the responsibility of Licensees and Vendors to monitor any
such changes.

P O S/A DV E R T I S I N G means printed materials that are intended for advertising or point of sale marketing only
including, but not limited to, banners, signs, standees, and displays, flyers, circulars, billboards, wraps, price
signs, shelving units, stoppers, roll-stands, hoardings and catalogues. POS/Advertising does not include physical
premiums or promotional giveaways provided to consumers.

R AW M AT E R I A L S means generic commodity items such as cotton, metal and paper that do not contain,
incorporate or involve the application of any Disney intellectual property.

S O C I A L CO M P L I A N C E M O N I TO R I N G O R G A N IZ AT I O N S are set forth in Appendix 5.

34
A2 FREQUENTLY ASKED QUESTIONS

APPENDIX 2

F R EQ UEN T LY A SK ED Q UE S T IONS
1. Am I required to submit an ILS Audit Report • Submission of a follow-up ILS Audit Report
for every Facility producing Disney-branded must be accompanied by all previous ILS
products? What about those Facilities being Audits Reports conducted within the same
used by more than one Licensee or Vendor? audit cycle unless Disney already has the
previous audits on file.
• A qualified ILS Audit Report is required to
be submitted by Licensees and Vendors only 3. Which audit programs are accepted by Disney?
for Facilities located in PSC designated as
Disney will accept (a) ILS Audits conducted
“Permitted with ILS Audits.” A qualified ILS
in accordance with the standards of a multi-
Audit Report is not required to be submitted
stakeholder or industry initiative program
by Licensees and Vendors for Facilities
recognized by Disney and performed by an
located in PSC designated as “Permitted
authorized Social Compliance Monitoring
without ILS Audits.” In all cases, Licensees/
Organization as designated by the respective
Vendors must declare each Facility by
program, (b) ILS Audits conducted in accordance
submitting a Facility and Merchandise
with Disney’s ILS Audit standards and performed
Authorization (“FAMA”) application.
by a Social Compliance Monitoring Organization
• Only one qualified ILS Audit Report is required that is approved by Disney, and (c) ILS Audits
for each Facility for the time period designated conducted in accordance with the standards
by Disney. If Disney already has a qualified ILS of a well-established brand, retailer, Licensee,
Audit Report on file that meets the Minimum or Vendor program recognized by Disney
Compliance Standard for such time period, it is and performed by one of the qualified Social
not necessary to submit another report. Compliance Monitoring Organizations approved
• A qualified ILS Audit Report submitted for a by Disney or by the internal or dedicated audit
Facility will impact the next audit due date as function of the recognized brand, retailer,
reflected in the “Action Required” section of Licensee, or Vendor program where approved
the monthly status report provided to every by Disney. If you are unsure whether an audit is
Licensee and Vendor working with that Facility. qualified for review, please check with your
Disney ILS Representative.
2. What is a qualified ILS Audit Report?
4. How much time should I plan for Disney to
• Please refer to the Requirements for a
evaluate the ILS Audit Report?
Qualified ILS Audit and ILS Audit Report
section of the ILS Program Manual for detailed Once you submit a qualified ILS Audit Report to
information on qualified ILS Audits and ILS Disney for review, the report will be processed as
Audit Reports. quickly as possible. Licensees and Vendors should
anticipate that this evaluation take up to 30 days
• Disney will not accept Facility certifications,
from when Disney receives the qualified ILS Audit
seals of compliance, self-assessments or self-
Report, unless additional clarification is needed.
audits, partial reports, preliminary reports
The amount of time to plan an audit may vary
(including Disney Corrective Action Plan
greatly. It is important for Licensees and Vendors
Acknowledgement Reports), or ratings in lieu
to consider that there are outside factors that
of a full ILS Audit Report.
may impact scheduling of an ILS audit–including

35
A2 FREQUENTLY ASKED QUESTIONS

audit firm capacity or local holidays. Licensees production of Disney-branded products in a

and Vendors should keep this in mind when Facility (even one currently being used by other
considering commissioning a qualified ILS Audit Licensees or Vendors) until Disney has issued
based on the next ILS Audit Report due date you a FAMA for the Facility.
listed on their monthly status report.
8. Why am I not authorized to start production with
5. What are the consequences of a Facility a Facility that is working with other Licensees or
failing to meet Disney’s Minimum Compliance Vendors?
Standard (“MCS”)?
Authorization to use a Facility is specific to a
• A newly declared Facility that does not meet Licensee or Vendor, not to the Facility. There
the MCS cannot begin production. may be pending items for the Facility that
prevent new FAMAs from being issued
• If a Facility for which you have a FAMA does
(e.g., the Facility does not currently have a
not maintain the MCS, you will generally have
qualified ILS Audit Report on file). In these
120 days to demonstrate the correction of
cases, you can check with your Disney ILS
all MCS violations through submission of a
Representative for further details.
qualified ILS Audit Report to Disney. Failure
to take the necessary corrective action may 9. Why does my monthly status report still show
result in the loss of authorization to produce Facilities I no longer work with?
Disney-branded products in the Facility and
Inactive Facilities will remain listed as
Licensees/Vendors using the Facility will be
“Expired Facilities” on the monthly status
required to promptly cease all such production
report for some time after the relationship has
in the Facility. Failure to submit a qualified ILS
expired. These Facilities are kept on your report
Audit Report within the required timeframe
for your reference and to ensure that you are
may result in a FAMA revocation.
fully aware that you are not authorized to utilize
6. I recently submitted an ILS Audit and the them for Disney-branded production until
Facility demonstrated compliance with the Disney issues you a new FAMA for the Facility.
MCS. Why is Disney scheduling a new audit
10. Can I obtain a list of Facilities used to produce
with this same Facility?
Disney-branded products by other brands or
Disney generally retains the right to audit retailers?
any Facility at any time anywhere in the world.
No. It is the responsibility of each Licensee/
Disney periodically conducts audits to confirm
Vendor to properly manage their supply
working conditions in Facilities producing
chain for Disney-branded products. This
Disney-branded products even where a
includes responsibility for identifying
qualified ILS Audit Report is already on file.
compliant Facilities and working to help
7. Is a FAMA provided by the Facility sufficient ensure their continuing compliance with
proof that the Facility is authorized to produce ILS Program requirements.
Disney-branded products?

No. FAMA’s are issued to Licensees and

Vendors, not to Facilities. A FAMA only
authorizes production in a given Facility for the
stated Licensee or Vendor. You may not start

36
A2 FREQUENTLY ASKED QUESTIONS

11. What do I do after I am authorized to produce be contacted and that they would need to
Disney-branded products? respond to Disney’s verification questions
before producing Disney-branded products.
Continue to work with the Facility to help
ensure proper working conditions are 13. Who receives notification that a Facility is no
maintained, resolve any issues promptly and longer authorized to produce Disney-branded
arrange follow-up ILS Audits as required products?
by the ILS Program.
If a Facility loses authorization to produce
• Disney recognizes that even though a Disney-branded products, all active Licensees
Facility meets the MCS, working conditions and Vendors who have ever used that Facility
in that Facility may not be in full compliance for Disney-branded production will receive
with the Disney Code. Therefore, you as a a Facility Loss of Production Authorization
Licensee/Vendor are responsible for working (“FLOPA”) Letter. This letter is sent to ensure
with Facilities to encourage continuous that you are fully aware of the Facility’s loss
improvement of all working conditions in any of authorization, whether you are currently
Facility producing Disney-branded products. producing in the Facility or not.
• Advise Disney of any changes to your Facility list.
14. If I have multiple agreements with Disney in
12. What is verification and why is my Facility one geographic market, do I need to submit
pending it? separate FAMA applications for a Facility
that I intend to use in connection with each
• Verification is a process Disney may utilize
agreement?
to determine the most accurate Facility
information. Disney may contact the Facility You should submit one FAMA application for
listed on the FAMA Application in order to a Facility that you intend to use in connection
confirm the accuracy of Facility information, with all active agreements that you have with
including address, phone numbers, and legal Disney in a particular geographic market. You
business name. will need to identify all of the Disney Business
Units you work with in that geographic market
• Please ensure that your Facility contacts/
under Section 3 of the new FAMA application
management understand that they may
(see references below).

List of Geographic Markets:

R EG I O N GEOGR APHIC MARKETS

ASIA, THE PACIFIC ISLANDS, AUSTRALIA Australia/New Zealand, Hong Kong, India, Indonesia, Japan, South Korea,
AND NEW ZEALAND (APAC) Malaysia, Philippines, PRC, Singapore, Taiwan, Thailand, Vietnam

Benelux, Denmark, France, Germany, Greece, Hungary, Iberia, Israel, Italy,

EUROPE, THE MIDDLE EAST AND AFRICA
London (regional), Middle East, Poland, Russia, South Africa, Sweden,
(EMEA)
Turkey, United Kingdom (except London)

Argentina, Bolivia, Brazil, CAC (Central America and the Caribbean),

LATIN AMERICA (LATAM) Chile, Colombia, Ecuador, Mexico, Miami, Paraguay, Peru, Uruguay,
Venezuela

NORTH AMERICA (NA) Burbank, Canada, New York, Orlando, USA (except Miami)

37
A2 FREQUENTLY ASKED QUESTIONS

Sample Section 3 of the FAMA application:

3 . AG R E E M E N T
(Include all Business Units you engage with by Geographic Market)

DISNEY BUSINESS DISNEY CONTRACT

DISNEY BUSINESS UNIT ILS REPRESENTATIVE
UNIT CONTACT DEAL NUMBER(S)

Licensing Shanghai Jane Doe 874633637475 Janet Jones

Shanghai Disneyland John Smith N/A Jim Smith

Studios Shanghai John Doe N/A Mary Taylor

15. If I have agreements with Business Units in 16. What is the duration of a FAMA?
multiple geographic markets and want to
• FAMA is generally valid for 3 years from the
use the same Facility for production under
date it is issued unless the FAMA is revoked
each agreement, can I submit one FAMA
by Disney or upon the expiration of your
application to cover all geographic markets?
agreement with Disney.
• No, you need to submit one FAMA application
• Please note this is separate from the annual
for each Facility that you intend to use for
audit requirement (where applicable). Always
each geographic market in which you have an
make sure to confirm the next audit due date
agreement (and you should identify all Disney
for a specific Facility by referring to your
Business Unit relationships in that market on
monthly status report.
your FAMA application).

• For example, if you are working with

Disneyland Paris and Consumer Products
in Canada, you will need to submit a FAMA
application for your designated Facility
in connection with your Disneyland Paris
business to your Disney ILS representative
for Disneyland Paris and a second FAMA
application to your Disney ILS representative
for Consumer Products in Canada.

38
A3 DISNEY CODE OF CONDUCT FOR MANUFACTURERS

APPENDIX 3

DISNE Y C ODE OF C ONDUC T F OR

M A NUFAC T UR ER S
At The Walt Disney Company, we are committed to:

• a standard of excellence in every aspect of our business and in every corner of the world;
• ethical and responsible conduct in all of our operations;
• respect for the rights of all individuals; and
• respect for the environment.

We expect these same commitments to be shared by all manufacturers of Disney merchandise and require that all
manufacturers of Disney merchandise meet the following standards:

CO D E O F CO N D U C T F O R M A N U FAC T U R E R S

Manufacturers will not use child labor.

The term “child” refers to a person younger than 15 (or 14 where local law allows) or, if higher, the local legal minimum age for
CHILD LABOR employment or the age for completing compulsory education.

Manufacturers employing young persons who do not fall within the definition of “children” will also comply with any laws and
regulations applicable to such persons.

INVOLUNTARY LABOR Manufacturers will not use any forced or involuntary labor, whether prison, bonded, indentured or otherwise.

Manufacturers will treat each employee with dignity and respect, and will not use corporal punishment, threats of violence or
COERCION AND HARASSMENT
other forms of physical, sexual, psychological or verbal harassment or abuse.

Manufacturers will not discriminate in hiring and employment practices, including salary, benefits, advancement, discipline,
NONDISCRIMINATION termination or retirement, on the basis of race, religion, age, nationality, social or ethnic origin, sexual orientation, gender,
political opinion or disability.

Manufacturers will respect the rights of employees to associate, organize and bargain collectively in a lawful and peaceful
ASSOCIATION
manner, without penalty or interference.

Manufacturers will provide employees with a safe and healthy workplace in compliance with all applicable laws and regulations,
ensuring at a minimum reasonable access to potable water and sanitary facilities; fire safety; and adequate lighting and
HEALTH AND SAFETY
ventilation. Manufacturers will also ensure that the same standards of health and safety are applied in any housing that they
provide for employees.

We expect manufacturers to recognize that wages are essential to meeting employees’ basic needs. Manufacturers will,
at a minimum, comply with all applicable wage and hour laws and regulations, including those relating to minimum wages,
overtime, maximum hours, piece rates and other elements of compensation, and provide legally mandated benefits.
Except in extraordinary business circumstances, manufacturers will not require employees to work more than the lesser
of (a) 48 hours per week and 12 hours overtime or (b) the limits on regular and overtime hours allowed by local law or,
where local law does not limit the hours of work, the regular work week plus 12 hours overtime. In addition, except in
COMPENSATION
extraordinary business circumstances, employees will be entitled to at least one day off in every seven-day period.

Manufacturers will compensate employees for overtime hours at such premium rate as is legally required or, if there is no
legally prescribed premium rate, at a rate at least equal to the regular hourly compensation rate.

Where local industry standards are higher than applicable legal requirements, we expect manufacturers to meet the
higher standards.

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A3 DISNEY CODE OF CONDUCT FOR MANUFACTURERS

CO D E O F CO N D U C T F O R M A N U FAC T U R E R S

PROTECTION OF THE
Manufacturers will comply with all applicable environmental laws and regulations.
ENVIRONMENT

Manufacturers will comply with all applicable laws and regulations, including those pertaining to the manufacture, pricing,
OTHER LAWS sale and distribution of merchandise. All references to “applicable laws and regulations” in this Code of Conduct include local
and national codes, rules and regulations as well as applicable treaties and voluntary industry standards.

Manufacturers will not use subcontractors for the manufacture of Disney merchandise or components thereof without Disney’s
SUBCONTRACTING express written consent, and only after the subcontractor has entered into a written commitment with Disney to comply with
this Code of Conduct.

Manufacturers will authorize Disney and its designated agents (including third parties) to engage in monitoring activities to
confirm compliance with this Code of Conduct, including unannounced on-site inspections of manufacturing facilities and
employer-provided housing; reviews of books and records relating to employment matters; and private interviews
MONITORING AND COMPLIANCE with employees.

Manufacturers will maintain on site all documentation that may be needed to demonstrate compliance with this Code
of Conduct.

Manufacturers will take appropriate steps to ensure that the provisions of this Code of Conduct are communicated to employees,
PUBLICATION including the prominent posting of a copy of this Code of Conduct, in the local language and in a place readily accessible to
employees, at all times.

40
A4 EXAMPLES OF MINIMUM COMPLIANCE STANDARD (MCS) VIOLATIONS

APPENDIX 4

E X A MP L E S OF MINIMUM C OMPL I A NCE

S TA NDA R D (“MC S ”) V IOL AT IONS
Examples of Minimum Compliance Standard (“MCS”) violations include, but are not limited to:

CHILD LABOR
Any confirmed current employment of underage workers or any inappropriate remediation of child labor
violations under applicable laws including, but not limited to the following examples:

• One or more employees are younger than the legal working age.

• Compliance with the minimum age requirement is unable to be verified because of the lack of the required
proof-of-age documents.

• Facility management did not ensure the safe return of previously hired underage worker(s) to his/her
parents or legal guardians.

I N VO LU N TA RY L A B O R
Any policies or practices of forced, bonded, indentured, or prison labor; mandatory or involuntary overtime,
or imposition of penalties or fines for refusing overtime; withholding of personal property (e.g., passport,
identification papers) or wages; or unreasonably limiting freedom of movement at any time including, but not
limited to the following examples:

• Employees are fined for refusing to work overtime.

• Access to the restroom is permitted only during break time.

• Documents, monetary deposits, or other collateral are retained as a condition of employment. Workers are
subjected to the withholding of wages, identification cards, passports, or other travel documents, or other
personal belongings.

CO E R C I O N A N D H A R A S S M E N T
Any policy permitting, or the practice of, corporal punishment; sexual harassment; threats of termination of
employment; imposing penalties or retaliation as disciplinary action; or intrusive or intimidating practices
including, but not limited to the following examples:

• Employees selected for interviews by auditors were intimidated by management.

• Employees who disagreed with job arrangements were restricted from working overtime.

• Employees were verbally and/or physically abused by a supervisor.

N O N D I S C R I M I N AT I O N
Discriminatory hiring and employment policies or practices (e.g., relating to salary, benefits, advancement,
discipline, termination, or retirement) on the basis of race, religion, age, nationality, social or ethnic origin,
sexual orientation, gender, political opinion, disability, pregnancy, or union membership including, but not
limited to the following examples:

• Job applicants are subject to HIV testing as part of the hiring process.

• Migrant employees receive lower wages for the same job held by local employees.

• The Facility recruits only females between the ages of 18 and 25.

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A4 EXAMPLES OF MINIMUM COMPLIANCE STANDARD (MCS) VIOLATIONS

A S S O C I AT I O N V I O L AT I O N S
Policies or practices that prevent employees from exercising their legal right to associate, organize, and bargain
in a lawful and peaceful manner in accordance with applicable laws (or retaliation for the exercise of any
such right) including, but not limited to the following examples:

• Employees were punished for participating in union activities.

• Employees were dismissed for participating lawfully in a labor strike.

H E A LT H A N D S A F E T Y
Conditions in the Facility, and/or dormitories, that could cause immediate severe injury or death to employees
or the public including, but not limited to the following examples:

• Emergency exits are locked or obstructed.

• The number of required emergency exits is insufficient based on the local law requirements or
Disney’s requirements, whichever is more stringent.

• Emergency evacuation drills are not conducted regularly based on the local law requirements or
Disney’s requirements, whichever is more stringent.

S U B CO N T R AC T I N G
Any use of another Facility or other source for Disney-branded production without authorization from Disney.

M O N I TO R I N G A N D CO M P L I A N C E
Employees are influenced to provide untruthful responses to auditors; discrepancies between the actual
number of employees observed at the Facility and the number of employees disclosed to auditors; failure to
provide accurate and complete records for review; or failure to permit auditor access to required documents,
private employee interviews, or health and safety inspection of the entire Facility including, but not limited to
the following examples:

• Employees appeared to have been coached by management to provide a predetermined set of answers
to auditors during private interviews.

• Wages and work hours could not be verified due to discrepancies between documents provided by
management and information provided by employees during private interviews.

• Auditors attempted to conduct an audit and were denied access to required documents.

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A5 SOCIAL COMPLIANCE MONITORING ORGANIZATIONS

APPENDIX 5

S OCI A L C OMPL I A NCE MONI T OR ING

ORG A NI Z AT IONS
Disney accepts ILS Audits conducted in accordance with the standards of certain multi-stakeholder or industry initiatives.
Disney encourages Licensees and Vendors to submit any available pre-existing audits that meet the requirements of a qualified
ILS Audit. The following list includes a representative sample of Social Compliance Monitoring Organizations from which
Disney accepts qualified ILS Audits. These organizations also conduct ILS Audits in accordance with Disney’s requirements.

You may contact these organizations to conduct ILS Audits. No Social Compliance Monitoring Organization can assure you
that a Facility will be authorized for Disney-branded production. The list of audit programs accepted by Disney is subject
to change. Therefore, before you schedule an audit, please check with your Disney ILS Representative to confirm whether
a particular program is accepted by Disney, as well as which Social Monitoring Organizations Disney currently accepts to
conduct ILS Audits.

This list of Social Compliance Monitoring Organizations is subject to change without notice.
Please check www.DisneyLaborStandards.com for the most up to date list and contact information.

A R C H E A DV I S O R S , I N C .

For more information about the company WEBSITE

For inquiries CO N TAC T

B U R E AU V E R I TA S CO N S U M E R P R O D U C T S S E R V I C E S ( B VC P S )

For more information about the company WEBSITE

For inquiries CO N TAC T

E L E VAT E H O N G KO N G H O L D I N G S L I M I T E D

For more information about the company WEBSITE

For inquiries CO N TAC T

I N S I T E CO M P L I A N C E L LC

For more information about the company WEBSITE

For inquiries CO N TAC T

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A5 SOCIAL COMPLIANCE MONITORING ORGANIZATIONS

INTERTEK

For more information about the company WEBSITE

For inquiries CO N TAC T

QIMA (ASIA INSPECTION)

For more information about the company WEBSITE

For inquiries CO N TAC T

S O C I A L CO M P L I A N C E S E R V I C E A S I A LT D.

For more information about the company WEBSITE

For inquiries CO N TAC T

U L V E R I F I C AT I O N S E R V I C E S I N C . ( U L CO N S U M E R A N D R E TA I L S E R V I C E S )

For more information about the company WEBSITE

For inquiries CO N TAC T

*List subject to change

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A6 REFERENCE LIST OF SOCIAL COMPLIANCE CONSULTANTS

APPENDIX 6

R EF ER ENCE L IS T OF S OCI A L
C OMPL I A NCE C ONSULTA N T S
In strengthening management systems, modifying labor practices, and improving working conditions, Licensees,
Vendors, and Facilities may benefit from the services offered by consulting groups and others that may assist in
the identification of underlying causes of compliance issues, suggest sustainable solutions, and/or help implement
change. Services offered by such organizations may take a variety of forms including, but not limited to:

• A root cause analysis

• An in-depth systems analysis
• Training programs

The social compliance consultants listed in this appendix may be able to provide these services. This list is
neither exhaustive nor exclusive. The services offered by these organizations are not endorsed by Disney, and
your engagement of the services of these or any other social compliance consultant cannot ensure that a Facility
will become or remain authorized for Disney-branded production. Licensees, Vendors, and Facilities are not
required to engage a social compliance consultant. If you do choose to engage a social compliance consultant,
you may choose from the following list, or you may choose any other organization, at your discretion. It is the
responsibility of the Licensee, Vendor, and Facility to identify any appropriate work plan, to negotiate terms of
service with any consultant, and to bear the cost of engaging any consultant.

Licensees, Vendors, and Facilities may benefit from reviewing the Good Practices for Complying with Licensors’
Social and Environmental Requirements: A Practical Guide for Licensees published by Business for Social
Responsibility (“BSR”) and the International Licensing Industry Merchandiser’s Association (“LIMA”) and
supported, in part, by Disney. This guide identifies basic requirements for Licensees and Vendors in meeting
licensors’ expectations.

1. THE CAHN GROUP

Contact Person: Doug Cahn, Principal ([email protected])

Website: www.thecahngroup.com

Headquarters: North America with partners worldwide

2 . E L E VAT E

Contact Person: Mark Jones, VP, Marketing & Business Development ([email protected])

China Contact: John Yeh, Business Development Associate, China ([email protected])

Website: www.elevatelimited.com

Headquarters: Hong Kong with client management offices in San Francisco, New York, London,
Shenzhen, Shanghai, Guangzhou, Hangzhou, Vietnam, Bangladesh, and India

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A6 REFERENCE LIST OF SOCIAL COMPLIANCE CONSULTANTS

3 . I M PAC T T L I M I T E D

Contact Person: Rosey Hurst, Founder and Director ([email protected])

Website: www.impacttlimited.com

Headquarters: London with offices in Guangzhou and Bangladesh

4 . S O C I A L ACCO U N TA B I L I T Y I N T E R N AT I O N A L

Contact Person: Christie Daly, Senior Manager, Corporate Programs ([email protected])

Website: www.sa-intl.org

Headquarters: New York, with offices or representatives in Amsterdam, Bangalore, Boston, Dubai,
Geneva, Istanbul, Sao Paulo, Shenzhen; Quezon City, Philippines and San Jose,
Costa Rica

5. VERITÉ

Contact Person: Robin Jaffin, Director of Supplier Programs ([email protected])

Website: www.verite.org

Headquarters: New York, with offices or representatives in Amsterdam, Bangalore, Boston, Dubai,
Geneva, Istanbul, Sao Paulo, Shenzhen; Quezon City, Philippines and San Jose,
Costa Rica

46
A7 BETTER WORK PROGRAM PARTICIPATION AND INSTRUCTIONS

LICENSEE/VENDOR AND FACILITY RESPONSIBILITIES

FAC I L I T Y:

• Register with Better Work, where available.

• Authorize Third Party Access for Disney online via the Better Work STAR Portal or as otherwise instructed
by Better Work. (See Better Work Help for additional information.)

LICENSEE/VENDOR:

• Register with Better Work, where available.

• Identify Disney as part of your supply chain online via the Better Work STAR Portal or as otherwise instructed
by Better Work.

• Pay for access to the related Better Work assessments.

Disney will have access to the Facility’s Better Work assessment only after the Facility authorizes Third Party
Access for Disney and payment for subscription to the Facility’s current assessment cycle is received and
processed by Better Work.

For additional information about the countries in which Better Work operates, including information on
participating facilities, visit the Factories and Manufacturers section on the specific Countries page of the
Better Work website.

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