DNFP_2018_English

2018 DECLARATION OF NON-FINANCIAL PERFORMANCE OF THE DESCOURS & CABAUD GROUP 28 DUE DILIGENCE The law on due diligence has been adopted and developed in response to various scandals such as the disastrous collapse of a building in Bangladesh in 2013 that caused the death of more than a thousand workers, or the affair of forced labour on the World Cup construction sites in Qatar. It aims to make French companies aware of their responsibilities vis-à-vis their suppliers or subcontractors abroad, with whom they have an established business relationship. All companies concerned must elaborate and effectively implement a due diligence plan. This plan includes measures designed to identify risks and prevent serious violations of human rights and fundamental freedoms, damage to personal health and safety and the environment resulting from the company's activities. The risk factors, consequences and means of control: A due diligence fault may be committed due to plan that is either non-existent or incomplete, or even ineffective. When a company that is served notice to meet these obligations fails to do so, the competent court may: • order the company to comply on pain of penalty. • characterise its possible civil liability in the event of environmental damage, health hazard or violation of human rights. The company officers' criminal liability may also be incurred. Lastly, the company's image could be tarnished in the event of an established disaster in which one or more of its foreign suppliers could be deemed liable. > The means of control: The plan includes a number of measures, which are taken by ourselves or are outsourced. A teamof 18based inShanghai for over 10years is tasked not just with supplier sourcing but also with carrying out product quality controls, meeting specifications and participating in the oversight of CSR criteria. These measures more particularly include: • a risk mapping, which identifies, analyses and ranks the risks. This mapping will be done by category of purchase and by country to determine a degree of exposure of the supplier or subcontractor. • regular assessments of the situation of suppliers and subcontractors with whom we have an established business relationship, with respect to the risk mapping. DESCOURS & CABAUD's team in Shanghai sends each supplier an “SQS” questionnaire (supplier qualification sheet), which is updated at least every 3 years. It deals with questions relating to suppliers' offerings of responsible products, the inclusion of CSR criteria in the product life cycle and transport and packaging. Works visits conducted for assessment on site review some of the points raised in the SQS and are the subject of a report.