It is the responsibility of the Ethics Commission to ensure compliance with the provisions of the Code of Ethics and monitor compliance of the standards of professional ethics with the rules of the Code of Ethics. This Commission has been established by the President of the Management Board and it includes:

• Member of the Management Board, Director of the HR Management Department;
• Member of the Management Board, Director of the Legal and Organisational Department;
• Director of the Office of Internal Control.

The Ethics Committee prepares a report on its activities on an annual basis, which is then submitted to the Management Board and to the Audit Committee of the Supervisory Board.

The Code of Ethics operates in parallel with the Compliance Policy, which is effective as of 31 October 2017 in the entire Budimex Group. Earlier, elements of this policy were in force in companies, but since then they have acquired a formal dimension. 2018 was the first full period of its term. The Code of Ethics supports the implementation, management and monitoring of the Compliance Policy, and is designed to: "provision of compliance of the organisation’s activities with the applicable law, standards and internal regulations, aimed at the prevention of damage of the organisation’s image and reputation, minimisation of risks of financial losses related to the organisation’s activities contrary to the law or internal regulations, as well as reduction of the risk of the organisation's exposure to civil, administrative or criminal liability”. It also states that respect for the law and ethics in business is one of the Budimex Group’s crucial rules.

The Compliance Policy is designed to draw attention of employees to the above-mentioned issues important for the Budimex Group. It introduces the so-called Compliance System, aiming at adopting and enforcing internal regulations properly. The proper application of and compliance with the Compliance Policy is supervised by the Chief Compliance Officer appointed by the Company's Management Board, the Deputy Chief Compliance Officer, and also by the Compliance Committee established at the request of the Chief Compliance Officer. It includes representatives of every organisational division of the Company. The Committee's Coordinator is a Member of the Management Board, Director of the Legal and Organisational Department. Non-compliance with the Code of Ethics or the Compliance Policy involves first of all legal and reputational risks. Where non-compliances are identified, there are also possible financial losses and conflicts of interests.

Operation of the Compliance Policy concerns the compliance with law and articles of association of the Budimex Group, the Code of Ethics, regulations, policies, procedures, instructions in force in companies, particularly those related to the minimisation of the risk of participation of the Group's employees in any activity raising suspicion of corruption or paid protection. In 2018, we conducted 9 training courses on anti-corruption policies and procedures. All employees (100%) familiarised themselves with anti-corruption policies and procedures. Nearly 250 persons (90%) holding managerial positions and having a function of superiors completed anti-corruption training. All (100%) members of management bodies familiarised themselves with anti-corruption policies and procedures and completed anti-corruption training. All (100%) the suppliers familiarised themselves with the Budimex Group's anti-corruption policy and regulations (contractual provisions).

Respect for human rights

The Budimex Group applies the Human Rights Protection Policy, which covers all companies. It is in line with the Code of Ethics and the Compliance Policy and aims at raising awareness of human rights in the entire Group, monitoring and solving problems in this area. Employees at all levels, customers, suppliers and contractors cooperating with the Group companies must observe the Policy.

The Policy commands the employer to respect the rights of employees expressed in the Declaration on Fundamental Principles and Rights at Work adopted by the International Labour Organisation. It obligates to act without discrimination, while promoting equal opportunities and valuing diversity, as well as complying with the prohibition of child labour, forced labour, freedom of association and the right to collective bargaining. Also, any forms of discrimination are forbidden against customers and society. The Ethics Commission is responsible for compliance with human rights. In 2018, no cases of breaking human rights were identified.

Human rights are promoted at each stage of the supply chain. The obligation to respect human rights applies also to suppliers and contractors. Appropriate procedures for evaluation and selection of suppliers have been established for this purpose. Human rights are included in the Contractor's Code, which must be signed by them prior to the commencement of cooperation with the Budimex Group's companies. Their compliance is monitored during audits. In 2018, in terms of compliance with human rights, none of the detected irregularities from among 1,163 analysed qualifying surveys of suppliers and 5,329 final assessments applied to human rights violations.

Diversity management

The Budimex Group staff consists of persons of different gender, in different age, which promotes intergenerational dialogue. One of the rules of the Code of Ethics is the effective discrimination prevention and, first of all, acting for the benefit of diversity and openness in the workplace. Intolerance and discrimination constitute a threat to its integrity, which is why Budimex SA has implemented the Diversity Policy referring to equal treatment with regard to, among others, gender, age, disability, health status, nationality, political beliefs, form, scope and basis of employment. Under the Policy, the Budimex company has undertaken to create an organisational atmosphere and culture ensuring respect for any form of diversity. The Diversity Policy concerns also recruitment, access to training and promotions, remuneration, combining professional duties with private life, protection against mobbing and an ungrounded dismissal.¹ The Budimex Group is dominated by persons in the age range of 30-50, the second group is constituted by persons under 30, and a slightly smaller group is people more than 50 years old. In Budimex, we also break the barriers connected with the health condition of employees by hiring disabled persons. In order to manage the Policy efficiently, the so-called anti-discrimination and anti-mobbing monitoring, as well as a system of educational tools, training courses and workshops have been implemented. The results of carrying out this Policy are reported to the Management Board every year. In 2018, there were no confirmed cases of discrimination.

Reporting violations

All the information about the Code of Ethics and Compliance Policy are available on Budinet − the Group’s intranet. Every new employee of the Group, as part of the introduction, becomes acquainted with the Code of Ethics, and since 2016 ethics has become a part of regular personnel training.

All employees of the Budimex Group have access to information and tools enabling them to report violations of the Code of Ethics or Compliance Policy. Reports can be made in person or anonymously to the Members of the Ethics Committee, Compliance Coordinator, hits Deputy or Members of the Compliance Committee, in writing to the address of Budimex, ul. Stawki 40, 01-040 Warsaw, by e-mail to the address etyka@budimex.pl or compliance@budimex.pl. Only authorised Members of the Ethics Committee or the Compliance Committee have access to both e-mail accounts. If a reporting persons expresses such a will, it remains anonymous. Everybody is assured of no business consequences connected with the fact of report. Employees have also the Compliance emergency telephone + 48 789 404.104. There occur also reports made beyond this system occur, e.g. in the form of letters sent directly to the President of the Management Board or members of the Management Board of Budimex SA – a parent company in the Budimex Group. In such a case, they are transferred directly to the persons responsible for their consideration.

All reports are investigated with the confidentiality standards preserved, and may be the basis for development of improvement and corrective actions. Every case of breach is recorded in writing together with recommendations or guidelines for further actions to be taken by a given organisational unit concerned by the report. In cooperation with the Compliance Committee and/or the Office of Internal Control, the Compliance Coordinator analyses every report in detail. It is also obliged to provide the Management Board and the Supervisory Board notification with regular reports containing information on actions taken in order to explain the given report (at least for a period of three months). Furthermore, the Supervisory Board's Audit Committee may request a report for a given period at any time. In 2018, 12 reports on failure to comply with the provisions of the Code of Ethics and/or Compliance Policy in the Budimex Group were made, of which five concerned employee matters (including one subcontractor's employee), while four reports pertained to subcontractors and one – a conflict of interest. There were recorded also two reports that might be regarded as an attempt of corruption probe. In 10 cases the reported infringements were not confirmed. None of those events resulted in financial losses in the Budimex Group. The list of reported infringements of the Code of Ethics / Compliance Policy in 2018 may be found in the Budimex Group’s Report on Non-Financial Information for 2008.