code of conduct - CAF · The Code of Conduct is valid for Spain and abroad, ... the measures...

CONSTRUCCIONES Y AUXILIAR DE FERROCARRILES, S.A.

AND SUBSIDIARY COMPANIES OF THE CAF GROUP

CODE OF CONDUCT

Approved by the CAF Board of Directors on 27th July 2011

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CONTENTS

1. OUR CODE OF CONDUCT..............................................................................................................3 1.1 INTRODUCTION. ......................................................................................................................3 1.2 PERSONS, GROUPS AND INSTITUTIONS ..............................................................................4 1.3 CORNERSTONES OF THE CODE OF CONDUCT ...............................................................5 1.4 TARGET GROUPS. ....................................................................................................................5

2. STRUCTURAL ETHICAL PRINCIPLE..................................................................................................7 2.1 OUR STRICTEST COMPLIANCE WITH THE LAW AND WITH HUMAN RIGHTS................7 2.2 INVOLVEMENT OF OUR SHAREHOLDERS ..........................................................................7 2.3 OUR CORNERSTONES ARE QUALITY AND EXCELLENCE................................................8 2.4 THE REPUTATION AND PRESTIGE OF CAF AS A BUSINESS CARD .................................8 2.5 THE PROTECTION AND PROMOTION OF OUR HUMAN RESOURCES..........................8 2.6 RESPECT FOR AND COMMITMENT TO THE COMMUNITY AND THE ENVIRONMENT9 2.7 CONFIDENTIALITY AND TRANSPARENCY IN ALL CAF RELATIONS ...............................9

3. BEHAVIOURAL CRITERIACRITERIA ..............................................................................................10 3.1 SHAREHOLDER RELATIONS .................................................................................................10 3.2 CUSTOMER RELATIONS........................................................................................................12 3.3 RELATIONS WITH SUPPLIERS AND OTHER PARTNERS .....................................................15 3.4 HUMAN RESOURCES ............................................................................................................17 3.5 RELATIONS WITH PUBLIC AGENCIES.................................................................................19 3.6 RELACIONES CON LA COMUNIDAD Y EL ENTORNO. .................................................21 3.7 OPERATIONS IN ORGANISED MARKETS...........................................................................22

4. IMPLEMENTATION ..........................................................................................................................24 4.1 FUNCTIONS.............................................................................................................................24 4.2 TRAINING. ...............................................................................................................................25 4.3 REPORTING CHANNEL.........................................................................................................25 4.4 BREACH OF THE CODE OF CONDUCT ............................................................................25

Código de Conducta - 3 -

1. OUR CODE OF CONDUCT

1.1 INTRODUCTION

This document contains the set of general principals and standards for corporate

governance and professional conduct that are applicable to all employees of

CONSTRUCCIONES Y AUXILIAR DE FERROCARRILES, S.A. and the subsidiaries

forming part of the CAF GROUP (hereinafter "CAF") and which are valid for

establishing the guiding parameters for the corporate culture of our organisation

(hereinafter the "Code of Conduct").

The priority goal of CAF is to build trust and to distribute value in the domestic and

international markets for the parts, equipment, materials, goods and services

intended for transport and other related activities, for the benefit of customer

requirements, shareholder investment, the competitiveness of the countries in

which CAF operates and the expectations of all those who work for our

organisation.

CAF aspires to maintain a relationship of trust, in the domestic and international

spheres in which it operates, with all the social and economic actors it has

dealings with. In other words, with those categories of groups, institutions or

persons whose contribution is necessary in order to make the mission of CAF a

reality.

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1.2 PERSONS, GROUPS AND INSTITUTIONS

These participating categories of

persons, groups or institutions whose

contribution is necessary in order to

make the mission of CAF a reality are,

amongst others, the shareholders,

organised markets, our workers and

the social partners integrated in our

organisation, the public bodies and

the local, national and international

communities in which CAF operates.

We are proposing and encouraging an ethical conduct intended to promote a

relationship of trust between CAF and its stakeholders. Those of us forming part of

this organisation, consider that a good reputation is an essential, intangible

resource and is beneficial to our internal and external relations with all the

stakeholders we have dealings with:

Shareholders Involvement Customers Quality and Excellence

Suppliers and partners Reputation Workforce Promotion and Protection

Public agencies Law Compliance Community and

Environment Respect and Commitment

Organized Markets Transparency

TRUST

Customer

International Community

Shareholders Organized markets

Suppliers

Public Agencies

Workers and social

stakeholders


1.3 CORNERSTONES OF THE CODE OF CONDUCT

Specifically, and amongst all the CAF corporate values and principals, this

present Code of Conduct is based on the following cornerstones:

(i) (i) the structural ethical principles that, in general terms, ought to govern

any business conduct or action by CAF, with regard to all the social and

economic actors with whom CAF aims to build trust and confidence.

(ii) (ii) the particular conduct criteria of CAF employees, with regard to the

different types of social and economic actors with whom they have

dealings within the framework of their business activities, in other words, with

shareholders, customers, organised markets, suppliers, workers, social

partners, public bodies, competitors and the international community.

(iii) (iii) the implementation mechanisms for the purpose of establishing

supervisory systems to ensure compliance with, and the corporate

development of, the Code of Conduct and all the structural ethical

principals and conduct criteria contained therein.

1.4 TARGET GROUPS.

This Code of Conduct is directed at the members of the Board of Directors, the

Audit Commission, the Compliance Committee and any other CAF supervisory

bodies, in addition to the directors, employees and any other natural or legal

person related to CAF by legal and / or commercial bonds, of any nature, in

addition to the companies forming part of the CAF Group and any natural or

legal persons related to these companies (hereinafter the "CAF employees").

CAF shall ensure that all the companies it controls (in accordance with the

definition of control established in article 42 of the Code of Commerce or any

other provision that may replace it in the future) and the key suppliers and

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collaborators that it has dealings with, shall adopt a code of conduct that

conforms to the structural ethical principles of this present Code.

The Code of Conduct is valid

for Spain and abroad, always

taking into account the

cultural, linguistic, social and

economic differences of the

different countries in which CAF

operates.


2. STRUCTURAL ETHICAL PRINCIPLE

2.1 OUR STRICTEST COMPLIANCE WITH THE LAW AND WITH HUMAN RIGHTS

All CAF employees shall strictly observe the legal system in force in all the

territories in which CAF operates, including any applicable regulations in the

corresponding countries, nations, provinces, regions, states, municipalities and

international organisations.

According to the above, any action taken by CAF and its employees, shall

scrupulously respect the laws, human rights and civil liberties and shall adopt all

the measures required to guarantee respect for the fundamental rights, the

principles of equal treatment and non discrimination, protection against the

exploitation of child labour and any other principles coming within the Universal

Declaration of Human Rights and the World Agreement of the United Nations

with regard to human rights, labour rights, environmental rights, and the fight

against corruption.

Within the framework of its professional activity, any entity or person collaborating

with or related to CAF must diligently respect the legal system in force, the Code

of Conduct and the internal regulations of CAF.

2.2 INVOLVEMENT OF OUR SHAREHOLDERS

CAF is strongly committed to creating and promoting the conditions required to

guarantee the involvement of its shareholders in those decisions coming within

their sphere of responsibility, guaranteeing equality of information and, likewise, to

safeguarding the interest of CAF and all its shareholders, against initiatives not

driven by the principles of transparency and correctness.

CAF is working to ensure that the economic and financial performance is such

that it maintains and increases the real value of the company, in order to

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adequately remunerate the capital investment risks assumed by shareholders and

investors.

2.3 OUR CORNERSTONES ARE QUALITY AND EXCELLENCE

CAF is focussed on meeting the needs and looking after the interests of its

customers, by taking account of all those requests that could improve the quality

of its products and services provided.

For this reason, CAF aims to ensure that its activities in the areas of research,

development, marketing and execution (production and provision) are directed

at achieving excellent standards of quality in its services and products.

2.4 THE REPUTATION AND PRESTIGE OF CAF AS A BUSINESS CARD

CAF has built up a solid reputation thanks to its extensive experience and to its

loyal and reliable workforce that is committed to the values and know-how

shaping the culture of CAF.

Each and every one of its employees shall endeavour to strengthen the prestige

enjoyed by CAF and to safeguard its reputation.

2.5 THE PROTECTION AND PROMOTION OF OUR HUMAN RESOURCES

CAF's employees are an essential factor in the company's success. CAF promotes

the professional advancement of people, by finding the right balance between

the company's objectives and the needs and expectations of its employees.

Likewise, CAF promotes the ongoing adaptation and improvement of the

competencies and skills of the entire organisation. In particular, Occupational Risk

Prevention is a priority for the company, and, therefore, CAF undertakes to

provide the means required to eliminate or reduce the occupational risks of all

those people working at CAF.


2.6 RESPECT FOR AND COMMITMENT TO THE COMMUNITY AND THE ENVIRONMENT

CAF is firmly committed to protecting and showing respect for the environment.

For this reason, the company's activity is based on the premise of minimising any

negative environmental impacts and of preventing pollution, by promoting

research, development and innovation directed at improving processes and

ensuring the training of its employees and professionals with regard to adequate

environmental management and the optimal management of our natural

heritage.

The commitment of CAF to the local, national and international community takes

the form of the development and promotion of initiatives focused on improving

the quality of life of the people in the communities in which it operates and in its

business sector.

CAF employees are expected to act pro-actively and to participate in harmony

with this commitment to the community, particularly with regard to social action

and respect for the social, economic, cultural and linguistic environments in the

countries in which they work.

2.7 CONFIDENTIALITY AND TRANSPARENCY IN ALL CAF RELATIONS

Information is one of CAF's key assets for the management of its activities.

All CAF employees shall use this resource with the maximum caution, maintaining

its integrity, confidentiality and availability and minimising the risks derived from its

disclosure and misuse, internally and externally.

CAF undertakes to provide complete and accurate information on the company,

to allow shareholders, analysts and other stakeholders to form an objective

opinion of CAF.

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3. BEHAVIOURAL CRITERIA

The specific behavioural criteria relating to each of the groups and persons with

whom CAF has dealings, and as set out in this Code of Conduct, must find their

inspiration in, and be applied with the strictest compliance with the legal system,

which shall in all cases form the basis of application. These behavioural criteria

shall be principally directed at:

the involvement of our shareholders;

quality and excellence of service in order to obtain the loyalty of our

customers¸

the reputation and prestige which we need to convey to our suppliers

and business collaborators;

the promotion and protection of our employees;

the strictest compliance with the law with regard to public organisations;

respect for and commitment to the community and the environment;

the transparency of our activities with regard to the organised markets

we are operating in.

3.1 SHAREHOLDER RELATIONS

The creation of value for our shareholders

A key company objective is to obtain higher returns on the investments of our

shareholders and to continuously maximize the value of their shares. With this aim

in mind, the CAF business and financial strategies are determined, reviewed and


adopted, maintaining the necessary weighting and balance with the objectives

of the group of persons forming part of CAF.

In any case, the maximisation of the value of our company, in the interest of its

shareholders, must of necessity be carried out within the demands imposed by

law, complying in good faith with the contracts concluded with the workers,

suppliers, financiers and customers and, in general, observing those ethical

principles and conduct criteria contemplated in this Code of Conduct.

Accurate information

The information communicated to shareholders shall be accurate, complete and

up-to-date and shall adequately reflect the company's situation. This premise

shall be scrupulously complied with, in relation to financial information.

CAF provides all the information and documentation required to enable investor

decision making to be based on acknowledge and understanding of the business

strategies and company management, and so that these decisions may serve to

obtain the expected return on the capital invested.

Internet is strengthened as a communications tool of between CAF and its

shareholders and other stakeholders, with an official website as a basic channel

to access to corporate information, all of which is in conformance with the

provisions of the following point.

Website

CAF undertakes to guarantee the uniformity of all informational documentation

by posting on its website all those documents intended for investors, and to

guarantee simultaneity with the information supplied to institutional investors and

to provide dynamic tools for communication through the website.

The documents posted on the CAF official website include: the articles of

incorporation, the regulations for the company's governing bodies, and other

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CAF internal bodies, the annual report and the internal code of conduct,

corporate governance reports, documentation relating to the holding of AGMs,

any relevant facts communicated to the CNMV (Spanish Security and Exchange

Commission), the professional profile of the members of the Board of Directors

and any other corporate documentation considered advisable.

Institutional shareholders

CAF establishes adequate mechanisms for the regular exchange of information

with the institutional investors forming part of the shareholders.

In no event shall the relations with institutional shareholders lead to the provision

of any information that could represent a privileged or advantageous situation

over other shareholders.

3.2 CUSTOMER RELATIONS

Honesty and professional responsibility

Any relation with our customers must comply with a strong commitment to

honesty and professional responsibility, in addition to respecting any regulations

applicable to relations with our customers.

For this reason, it is necessary to respect the commitments acquired with our

customers, giving them due notice of any change, modification, alteration or

variation in verbal and written agreements, promoting the transparency of the

relations of our organisation, and acting with integrity in all professional dealings

with our customers.

Contracts and promotional activity with customers


Contracts and promotional activity with CAF's customers must be (i) clear and

direct; (ii) conform to all regulations in force, without circumventing practices or

having recourse to practices which are, in any case, incorrect and (iii) complete,

so that all relevant information is made available to our customers for decision

making purposes.

CAF undertakes not to use misleading or false advertising instruments. Marketing

activities must be conducted by offering all the relevant information to our

customers, for adequate decision making.

Confidentiality and privacy

Any sensitive customer information must be treated with absolute discretion and

confidentiality and must only be given to its legitimate owners or when formally

required to do so, always with all due legal guarantees.

Commercial procedures with customers must be made, whenever so required, in

a place that can guarantee the privacy and confidentiality of the conversations,

negotiations and documentation used.

Conflicts of interest

Any financial, family, friendship - related link, or link of any other nature, of our

employees with customers, could distort the independence of decision making

and could involve a potential risk of disloyal action, due to private interests

competing with CAF company interests.

Therefore, whenever these circumstances arise, the CAF Compliance Committee

should be informed.

Specifically, a conflict of interest shall be understood to exist whenever the

company's interest directly or indirectly competes against the personal interest of

any CAF employee, as defined earlier, or that of any spouse, relative in the

ascending line, spouse of the relative in the ascending line, relative in the

descending line, spouse of the relative in the descending line, brother or sister,

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spouse of the brother or sister, or companies with regard to which the CAF

employee comes within one of the situations contemplated in article 4 of the

Securities Market Act (hereinafter "related parties")

Therefore, in general terms, there should be no acceptance of any conduct that

compromises the decision making independence of CAF or its customers.

Presents, gifts and favours

CAF shall not make or accept any type of present or gift that could be

interpreted as something outside normal commercial practices or common

courtesy gifts.

In particular, it is forbidden to make any type of present, gift or to offer any

favours to customers that could affect the decision-making independence of the

latter, or which could lead to a guarantee of some type of favour to CAF or to its

employees and directors.

In any case, every care shall be taken to avoid this type of conduct in any

international transactions in which CAF intervenes, in consideration of the difficulty

in controlling this in jurisdictions and markets outside Spain and due to the

negative impact that the said conduct could have on the company's

international reputation.

CAF shall refrain from practices that are not permitted by the applicable

legislation, by commercial practices or by the ethical codes of conduct, should

these be known, of companies or entities with which it maintains a business

relationship.

Any gift made by CAF shall be characterised by the fact that its value may only

be symbolic and that it shall be intended to promote the CAF brand image. Any

present made for this purpose must be arranged and authorised following the

business protocols.


Management of complaints

Any complaint shall be welcomed by our organisation, because it will help us to

rediscover the direction leading to excellence and professionalism in our service

and in our products.

For this reason, CAF employees undertake to deal with, to answer, to channel

and, where appropriate, to resolve any complaint or grievance made by our

customers.

Business opportunities

No CAF employee has the right to use CAF's name or to cite his/her professional

category for conducting operations for his/her own account or for that of related

parties.

No CAF employee has the right to make, for his/her own gain or for that of any

related party, any investment or any other transaction related to CAF's assets,

which has come to his/her knowledge in the course of his/her work, when the

investment or transaction had been offered to CAF, or CAF had an interest in it,

provided that CAF has not rejected the said investment or transaction, with no

intervention by the employee in question to influence this decision.

3.3 RELATIONS WITH SUPPLIERS AND OTHER PARTNERS

Our vision of suppliers as collaborators

The new challenges faced by the international rail transport market demand

collaboration between CAF and its suppliers. Suppliers of products and services

to CAF are viewed as professionals or business collaborators throughout the

world.

Selection of suppliers and other collaborators

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The process to select our collaborators must be characterised by the search for

competitiveness and quality, guaranteeing equality of opportunities between all

suppliers and collaborators with our organisation.

Specifically, providing that the requirements are complied with, CAF employees

shall never refuse anyone the chance of taking part in the competitive bids for

products and services, and candidates shall be selected using objective and

transparent criteria.

Should a supplier or collaborator, whilst carrying out work for CAF, adopt a

conduct that does not conform to the general principles of this present Code of

Conduct, then CAF shall have the right to take appropriate measures and may

reject future collaboration with the said supplier.

Relations with suppliers

The relations with our suppliers shall be governed by common principles and CAF

shall conduct strict controls for quality, compliance and excellence.

The conclusion of a contract with a supplier must always be based on clear

relations, avoiding any type of dependence.

Relations with commercial agents

CAF considers its commercial agents to be a fundamental part of its business

strategy and that, on many occasions, the image projected by CAF to its

domestic and, in particular, to its international customers in its commercial

transactions, will be closely related to the professional action adopted by its

agents.

For this reason, CAF will require any commercial agent or collaborator

representing the company in commercial, national or international transactions,

to be conversant with this Code of Conduct and to strictly comply with it, and

also to act firmly against any failure to comply with this Code.


Independence

The purchase of goods or services shall be performed, at any level, with complete

decision-making independence. Any economic or family connection, or of any

other nature, must take into account the provisions of section 3.2 above, in

relation to the potential existence of a conflict of interest.


In particular, "mutatis mutandis" shall also be applicable to the relationship

between CAF and its suppliers and collaborators, the prohibition to make or

accept presents, as established in section 3.2 above. In this respect, the

prohibition established in this section shall be equally applied to all CAF

professionals and employees. The purchasing departments must, where

appropriate, take every care to avoid this type of practice.

3.4 HUMAN RESOURCES

Recruitment of personnel and job promotion

CAF shall avoid any type of discrimination with regard to its own employees.

Within the sphere of the personnel management and advancement processes,

and also in the selection phase and job promotion, the decisions taken shall be

based on the extent to which the expected profiles correspond to the actual

professional profiles, and on merit related considerations.

Access to duties and responsibilities shall also be established, by taking

competencies and skills into account. In addition, whenever it is compatible with

general work efficiency, a flexible working arrangement shall be favoured,

making it possible to reconcile work and family life.

Training.

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CAF shall make information and training tools available to all its employees in

order to assess their specific competencies and to develop the professional value

of each person.

The training responds to the objectively set requirements of the organisation and

takes account of the professional advancement of each person.

Gender equality

CAF employees shall respect the right to equal opportunities for men and women.

In general, they shall actively promote the absence of any direct or indirect

gender discrimination, and shall uphold and effectively apply the principle of

equality between men and women at work, progressing in the establishment of

measures to favour the reconciliation of work and family life.

The principle of equal treatment and equal opportunities for men and women

shall be guaranteed, with regard to access to employment and also to job

training, job promotion and working conditions.

CAF shall adopt any appropriate measures or decisions in the face of any action

constituting or causing gender discrimination.

Occupational health and safety

CAF declares that it is firmly committed to maintaining and developing the

Occupational Risk Prevention System in place, undertaking to protect its workers

as a key objective in this area, and promoting the integration of prevention at all

levels of the Company.

CAF shall adopt the measures required to eliminate or reduce any risks,

guaranteeing compliance with the applicable legal requirements, promoting


consultation and worker participation, and raising the awareness of all employees

with regard to risk prevention.

Moral integrity

CAF undertakes to protect the moral integrity of its employees, by guaranteeing

the right to working conditions that respect personal dignity. For this reason, it shall

protect its workers against acts of psychological violence and combat any

attitude or behaviour that is discriminatory against or injurious to people, their

convictions or preferences.

The necessary measures shall be taken to prevent and, where appropriate, to

correct sexual harassment, mobbing and any other type or violence or

discrimination, by preventing all CAF employees from any behaviour or discourse

that could harm personal sensitivity.

3.5 RELATIONS WITH PUBLIC AGENCIES

Legality and integrity in our relations with public bodies

CAF's business activity requires the company to regularly take part in public

tenders and bids, in Spain and abroad, involving regular contact with public

bodies, authorities and civil servants.

The guiding principle that shall at all times govern the relations between CAF and

any public bodies, authorities and civil servants with whom it has dealings, shall be

based on the strictest compliance with the applicable legal system.

In particular, with regard to any obligations that CAF may acquire with public

administrations, either in Spain or abroad, particular attention shall be paid to

strict compliance with all applicable regulations relating to tax, social security

and the prevention of money laundering.


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The prohibitions indicated in section 3.2 relating to presents, gifts and favours to

customers shall also apply to the relations with CAF and public bodies.

CAF shall not make or accept any type of present or gift to civil servants, public

authorities or bodies in general, which could be interpreted as something beyond

the common practices of courtesy.

In particular, it is prohibited to make any type of present, gift or favour to Spanish

or foreign civil servants, auditors, board members, etc that could have an impact

on the independence of judgement or lead to the guarantee of some type of

favour.

CAF shall refrain from any practices not permitted by the applicable legislation,

by commercial practices, or codes of conduct, should these be known, of the

public administrations and bodies with which it maintains business relationships.

Any gift made by CAF shall be characterised by the fact that its value can only

be symbolic and that it shall be directed at promoting the CAF brand image. Any

present made for this purpose must be arranged and authorised following the

business protocols

Political parties

In compliance with the legislation of each country in which it operates, CAF shall

refrain from conducting any activity that is prohibited in relation to the financing

of political parties or to the sponsoring of purely political events.

CAF shall also refrain from making any direct or indirect political pressure.

Competition law and regulatory bodies


CAF shall comply with and undertakes to comply with any local, national or

international regulations on competition law and shall collaborate with the

authorities regulating the market.

3.6 RELATIONSHIPS WITH THE COMMUNITY AND THE ENVIRONMENT

Environmental policy

CAF has environmental policies and a sustainable industrial development policy,

in compliance with the environmental legislation in force in the countries in which

it operates.

The CAF environmental policy is also supported by the awareness that respect for

the environment can be a competitive advantage in a market which is ever

widening and which is increasingly becoming more demanding in those areas

relating to quality and conduct.

The CAF strategy is characterised by a focus on investments and activities that

respond to the principles of sustainable development.

Local, national and international community

The commitment of CAF to the local, national and international community takes

the form of the development and promotion of initiatives focused on improving

the quality of life of the people in the communities in which it operates and in its

business sector.

CAF declares that it is willing to contribute to the improvement of the quality of

life and to the creation of wealth, through its own provision of services and also

through new business activities and even, in certain circumstances, through the

promotion of the economic, social or cultural development of the communities in

which it operates, through non-business channels.

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3.7 OPERATIONS IN ORGANISED MARKETS

Transparency

CAF shall act with total transparency, by adopting specific procedures to

guarantee the correctness and accuracy of the corporate, financial and

corporate governance documentation, provided to the organised markets and to

prevent corporate crimes and market abuse.

The corporate documentation shall include an annual corporate governance

report, approved by CAF and containing the legally required statements, and this

shall be published in conformance with the provisions of the legislation on the

securities market.

CAF shall comply at all times with its legal obligations with regard to periodical

public information, the communication of relevant events, and other duties of

transparency, and agrees to fully abide by the regulation and control of the

Spanish Security and Exchange Commission.

In particular, with regard to financial information, CAF shall pay particular

attention to ensure that the said information is reliably prepared and is suitably

recorded and disseminated to the market.

Control of information

CAF has a set of internal rules of conduct for the management and treatment of

classified information. These rules of conduct contain the protocols for the

external communication of CAF-related documents and information, with

particular reference to privileged information.

In accordance with the provisions of the aforementioned internal rules of

conduct, all CAF employees in possession of privileged information, are obliged

to safeguard it and to adopt adequate measures to prevent the unfair or abusive

use of the said information and, where appropriate, they shall immediately take


the action required to correct the consequences derived from this, with the

exception of communications with the judicial or administrative authorities, in the

terms established by Law and in the aforementioned internal rules of conduct.

CAF employees must refrain from conduct that may give rise to situations relating

to the abuse of confidential information and the manipulation of the market, and

also by third parties. In order to guarantee the maximum transparency,

procedures shall be adopted with regard to the management of classified

information, that are in compliance with the legislation and with best international

practices.

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4. IMPLEMENTATION

The CAF Compliance Committee shall be the delegated body to advise the

Board of Directors, the Audit Commission and any other supervisory bodies at CAF

and the other group companies, as to the adoption of policies that promote

ethical behaviour at CAF and compliance with this present Code of Conduct.

4.1 FUNCTIONS.

The Ethical Compliance Committee shall have the following functions:

To check that the Code of Conduct is applied, through specific activities

directed at monitoring the continuous improvement of the conduct within

CAF, by assessment of the processes to control the conduct risks.

To review the initiatives to ensure that personnel are conversant with, and

have an understanding of the Code of Conduct.

To receive and study any reports that the Code of Conduct has been

broken.

To take decisions with regard to any significant breaking of the rules of the

Code of Conduct, proposing, where appropriate, sanctions and disciplinary

measures.

To establish controls to prevent any crimes being committed and which

could involve the legal liability of CAF.

To propose to the Board of Directors, any amendments and inclusions to be

made to the Code of Conduct and to maintain, publish and keep up-to-

date this present Code of Conduct.


4.2 TRAINING.

The Code of Conduct shall be made known to the internal and external parties

involved, by means of specific communication activities and also by posting the

Code on the CAF website.

In order to ensure that the Code of Conduct is correctly understood at all levels,

an annual training plan shall be established directed at promoting an awareness

of the principles and ethical standards established in this present Code of

Conduct.

4.3 REPORTING CHANNEL

CAF undertakes to establish, for each party involved, some reporting channels to

be used communication purposes. These channels shall safeguard the

confidentiality of the information processed.

In particular, in relation to the financial information preparation process, CAF shall

establish, under the supervision of the Audit Committee, a reporting channel to

make it possible to inform of potentially far-reaching irregularities, particularly

financial and accounting ones, in addition to potential failures to comply with the

Code of Conduct and improper dealings within the organisation.

Likewise, with regard to those aspects that could affect CAF employees, such as

discriminatory situations, harassment, mobbing or work safety, amongst others,

specific channels shall be established to report this and deal with any improper

conduct that may occur in these areas.

4.4 BREACH OF THE CODE OF CONDUCT

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The CAF Compliance Committee shall send reports on breaches of the Code of

Conduct, detected following the indications of those involved or following an

audit, and any suggestions considered necessary.

For the most significant cases, either the Board of Directors or the Audit

Committee shall adopt the corresponding measures.

For all other cases, this shall be the responsibility of the CAF General

Management.

No one, regardless of his / her level or position, is authorised to request a

professional to commit an illegal act or to go against the provisions of this present

Code of Conduct.

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