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VENDOR CODE OF CONDUCT

1. Introduction

Corporate integrity, responsible product sourcing, and the safety and wellbeing of workers across the global supply chain are of paramount importance to FIGS. These principles apply to all aspects of FIGS’s business, and encompass all manufacturers, distributors, vendors, and other suppliers (each a “Vendor”) that supply the products or components thereof that FIGS sells (“Products”).

These principles are reflected in this Code of Conduct (“Code of Conduct”), which establishes the minimum standards that must be met by any Vendor that sells Products to or does business with FIGS, regarding:

  • Vendor’s treatment of workers;

  • workplace safety;

  • the impact of Vendor’s activities on the environment; and

  • Vendor’s ethical business practices.

2. Applicability

This Code of Conduct applies to each Vendor that provides Products (whether component or finished) to FIGS. Vendor is responsible for compliance with the standards set out in this Code of Conduct (“Standards”) throughout its operations and throughout its entire supply chain, including at:

  • all of its facilities; and

  • all of its operations, including with respect to manufacturing, distribution, packaging, sales, marketing, product safety and certification, intellectual property, labor, immigration, health, worker safety, and the environment.

Without limiting Vendor’s obligations hereunder, Vendor is responsible for compliance with the Standards by all of its suppliers, vendors, agents, and subcontractors and their respective facilities (“Partner(s)”). Vendor’s facilities, together with its Partners’ facilities at which any Products are manufactured, packaged or otherwise handled, are referred to herein as the “Facilities” or a “Facility.”

3. Forced Labor and Human Trafficking

3.1. General

All labor must be voluntary. Vendor shall not support or engage in forced labor or human trafficking in any part of its supply chain.

Without limiting Vendor’s obligations hereunder, Vendor shall not, and shall ensure that its Partners do not, support or engage in, or require any:

  • compelled, involuntary, or forced labor;

  • labor to be performed by individuals under the legal age required by your local laws (if no minimum age laws exists, under fourteen years old);

  • bonded labor;

  • indentured labor; and

  • prison labor.

3.2. Compliance and Documentation

Vendor shall:

  • Implement and maintain a reliable system to verify the eligibility of all workers, including:

    • age eligibility; and

    • legal status of foreign workers.

  • Implement and maintain a reliable recordkeeping system regarding the eligibility of all workers.

3.3. Hazardous Work

Without limiting Vendor’s obligations hereunder, Vendor shall not, and shall ensure that its Partners do not, support or engage in, or require any hazardous labor to be performed by any person under the age of 18. Hazardous labor involves any work, that by its nature or the circumstances in which the work is undertaken, involves the substantial risk of harm to the safety or health of the worker or coworkers if adequate protections are not taken.

3.4. Identification Papers

Without limiting Vendor’s obligations hereunder, Vendor shall not require any worker to surrender control over original:

  • identification papers or documents giving a foreign worker the right to work in the country;

  • identification papers or documents, such as a passport, giving a foreign worker the right to enter or leave the country; or

  • documents, such as a birth certificate, evidencing the worker’s age.

3.5. Financial Obligations

Without limiting Vendor’s obligations hereunder, Vendor shall not, whether or not as a condition to the right to work, require any worker (or worker’s spouse or family member) to, directly or indirectly:

  • pay recruitment or other fees or other amounts (monetary or in-kind);

  • incur debt.

  • make financial guarantees; or

  • incur any other financial obligation.

3.6. Freedom of Movement

Without limiting Vendor’s obligations hereunder, Vendor shall ensure that workers have the right to freedom of movement without:

  • delay or hindrance; or

  • the threat or imposition of any discipline, penalty, retaliation, or fine or other monetary obligation.

Worker freedom of movement rights include each worker’s right to leave the Facilities without retaliation:

  • at the end of each workday;

  • based on reasonable health and safety-related justifications; and

  • based on any reasonable circumstances, such as personal or family emergencies.

3.7. Freedom to Terminate Employment

Without limiting Vendor’s obligations hereunder, Vendor shall allow workers to terminate their employment or work arrangement:

  • without restriction; and

  • without the threat or imposition of any discipline, penalty, retaliation, or fine or other monetary obligation.

4. Compensation and Benefits

Vendor must compensate all workers with wages, including overtime premiums, and benefits that at a minimum meet the higher of:

  • the minimum wage and benefits established by Applicable Law (as defined below);

  • collective agreements;

  • industry standards; and

  • an amount sufficient to cover basic living requirements.

Workers must be paid in a timely manner.

Vendor’s obligation to compensate and provide benefits applies to all workers at all times, including during periods of training, apprenticeship, and probation.

Vendor shall not make any deductions from wages, except income tax withholding and those that are legally allowed.

5. Work Hours

Vendor shall ensure all work hours and overtime are consistent with Applicable Laws (as defined below) and industry standards, including maximum hour and rest period laws.

Works may refuse overtime without threat of penalty, punishment or dismissal. Vendor shall pay overtime at a premium rate.

Vendor shall accurately and fully document all hours worked.

6. No Discrimination, Abuse, or Harassment

Vendor shall not discriminate in hiring, compensation, training, advancement or promotion, termination, retirement, or any other employment practice based on race, color, national origin, gender, gender identity, sexual orientation, military status, religion, age, marital or pregnancy status, disability, or any other characteristic other than the worker’s ability to perform the job.

Vendor shall treat workers with respect and dignity.

Vendor shall not subject workers to corporal punishment, or physical, verbal, sexual, or psychological abuse or harassment. Vendor must not condone or tolerate such behavior by its Partners.

7. Health and Safety

Vendor shall provide a safe, healthy, and sanitary working environment and meet or exceed the labor standards established by the United Nations International Labor Organization Declaration on Fundamental Principles and Rights at Work and the jurisdiction in which Vendor performs its obligations. Vendor shall implement procedures and safeguards to prevent workplace hazards, and work-related accidents and injuries, including procedures and safeguards to prevent industry-specific workplace hazards, and work-related accidents and injuries, that are not specifically addressed in these Standards. General and industry-specific procedures and safeguards include those relating to:

  • health and safety inspections;

  • equipment maintenance;

  • maintenance of Facilities;

  • worker training covering the hazards typically encountered in their scope of work;

  • fire prevention; and

  • documentation and recordkeeping.

Vendor shall provide workers adequate and appropriate personal protective equipment to protect workers against hazards typically encountered in the scope of work. Vendor shall maintain a strict broken needle policy.

Vendor shall operate and maintain the manufacturer Facilities in compliance with the standards, rules, and regulations established by the Fair Labor Association. Without limiting the generality of the foregoing, Vendor shall:

  • ensure that all Facilities meet all applicable building codes and industry design and construction standards;

  • obtain and maintain all construction approvals required by law;

  • obtain and maintain all zoning and use permits required by law; and

  • post, in a clearly visible, legible and readily understandable manner, a list of worker’s rights, which rights will be clearly explained to all employees and any other persons providing services in their own respective languages.

To assess any Facilities’ compliance with our responsible sourcing expectations, we use independent, third-party, expert auditors. FIGS strives to audit all Facilities producing Products at least once per year. Before a Facility is approved to produce, package or handle Products for FIGS, it must undergo a social and environmental audit as part of its evaluation.

8. Freedom of Association and Collective Bargaining

Vendor shall respect, and shall not interfere with, the right of workers to decide whether to lawfully associate with groups of their choice, including the right to form or join trade unions and to engage in collective bargaining.

Without limiting Vendor’s obligations set out above, Vendor shall not:

  • take any action to prevent or suppress the workers’ exercise of freedom of association or collective bargaining rights;

  • discriminate or retaliate against, or discipline or punish, any worker who supports or exercises freedom of association or collective bargaining rights;

  • discriminate or retaliate against, or discipline or punish, any worker who raises collective bargaining compliance issues; or

  • discriminate or retaliate against, or discipline or punish, any worker based on union membership or the worker’s decision to join or not join a union.

9. Environmental Protection

9.1. Operation of Vendor’s Facilities

Vendor shall operate its Facilities in compliance with all environmental laws, including laws and international treaties relating to:

  • waste disposal;

  • emissions;

  • discharges; and

  • hazardous and toxic material handling.

9.2. Inputs and Components

Vendor must ensure that the Products that it manufactures for FIGS (including the inputs and components that it incorporates into its Products) comply with all environmental laws and treaties. Vendor must ensure that it will only use packaging materials for the Products that comply with all environmental laws and treaties.

10. Sustainability

In producing Products for FIGS, Vendor will prioritize fabrics made with sustainable fibers and yarns and only use the following suitable fabrics:

  • Organic cotton

  • Recycled polyester

  • Recycled nylon/polyamide

  • Manmade cellulosics: Fibers cannot be sourced from ancient or endangered forests

  • Non mulesed wool / RWS certified mill & garment supplier

Vendor must dispose of all waste produced during the course of the manufacturing of the Products in a responsible, lawful and sustainable manner that makes such waste unusable in the manufacture of any apparel, other than the Products manufactured on behalf of FIGS.

11. Business Ethics

Vendor must maintain the highest ethical standards.

Vendor shall comply at all times with all anti-bribery and anti-corruption laws of any jurisdiction, including the United States Foreign Corrupt Practices Act, generally codified in 15 U.S.C. 78 (the “FCPA”), as the FCPA may hereafter be amended, and/or its successor statutes, and any law of any country which is or will become a signatory to the OCED Convention on Combating Bribery of Foreign Public Officials. Vendor represents and warrants that neither it nor any persons working on its behalf have or will directly or indirectly pay money or give, offer or promise to give anything of value directly or indirectly to any representative or employee of any government (or subdivision thereof), to any political party or candidate for political office, or to any customer or supplier of FIGS or potential customer or supplier if such payment was or would be contrary to any Applicable Laws.

12. Report Violations

Vendor shall self-report any violations of this Code of Conduct. Vendor can also submit questions and comments regarding this Code of Conduct, to FIGS’s liaison set out below:

FIGS Legal: Attention General Counsel

2834 Colorado Ave., Suite 100 Santa Monica, CA 90404

Vendor shall not retaliate or take disciplinary action against any worker who has, in good faith, reported violations or questionable behavior, or who has sought advice regarding this Code of Conduct or these Terms.

13. Compliance with Laws

Vendor shall comply with all applicable national and local laws, rules and regulations, including laws and regulations relating to all the Standards (“Applicable Laws”), in the development, manufacturing, packaging, labeling, storage, and transportation of FIGS Products. Where this Code of Conduct requires Vendor to meet a higher standard than set out by Applicable Law, Vendor shall meet such higher standard. Vendor acknowledges that these Standards set out audit standards that FIGS may use to determine whether Vendor is meeting the requirements of this Code of Conduct.

Without limiting the foregoing, Vendor shall obtain and maintain in effect, any government approvals, authorizations required for performance of its obligations hereunder, including, but not limited to, foreign exchange approvals, import and offer agent licenses and fair trade approvals. Vendor shall obtain, maintain and arrange for the safety site certifications required in connection with Products manufactured on behalf of FIGS. Vendor shall execute and/or furnish all certifications, guaranties and other documents regarding and verifying compliance with all Applicable Laws. In addition, in the event that Vendor learns that Products are not in compliance with any Applicable Laws, or Vendor receives correspondence regarding any potential or actual non-compliance or violation of any safety standard under which a FIGS Product is named by any regulatory authority, Vendor shall give prompt written notice to FIGS.

Vendor shall reasonably assist FIGS in obtaining any approvals required by any applicable regulatory authority.

Whenever registration of FIGS’ agreement with Vendor is required by a governing body in order for FIGS to preserve its rights under these Terms or any Purchase Order, Vendor shall give prompt notice to FIGS so that FIGS may preserve its rights herein.

Vendor shall also:

  • Obtain all governmental approvals, certifications and licenses required to fulfill its obligations under these Terms.

  • Maintain manufacturing, testing and shipping records and make all applicable reports and filings in respect of the production of the product available to applicable governmental bodies promptly upon FIGS’ request.

  • Comply with applicable customs laws.

  • Have and maintain a Worldwide Responsible Accredited Production (WRAP) Certificate, which Vendor shall provide to FIGS at least annually (and at any other time upon FIGS’ request). For the avoidance of doubt, Vendor shall provide renewal WRAP Certificates to FIGS promptly after receipt of such renewal.

14. Xinjiang Production and Construction Corps. – Executive Order 13818

On July 9 and July 31, 2020, the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC), placed China’s Xinjiang Production and Construction Corps. (XPCC) on its Specially Designated Nationals List (SDN List), pursuant to Executive Order 13818. Accordingly, the U.S. has banned business with XPCC or any of its affiliates.

As such, FIGS wishes to ensure that no Vendor conducts business with XPCC or any of its affiliates. In accordance with the Executive Order 13818, Vendor:

  • Confirms and agrees that it will only source raw materials from FIGS-approved suppliers, and only manufacture garments in FIGS-approved facilities. Vendor may not use any subcontractors for services Vendor provides to FIGS unless Vendor obtains FIGS’ written approval prior to the commencement of services;

  • Confirms and agrees that it will maintain end-to-end traceability records, including but not limited to any invoices for raw or other materials, garment sewing, conversion, production or other services for any FIGS Products, including but not limited to any personal protective equipment (PPE). FIGS, in its sole discretion, may require Vendor to provide FIGS with copies of all pertinent documents to trace origin of materials at FIGS’ convenience to ensure compliance herein; and

  • Confirms that it or any of its affiliates or subcontractors, are not currently sourcing any raw or other materials and/or services from XPCC or any of XPCC’s affiliates, or any other company or entity located in China’s Xinjiang region. In addition, Vendor agrees that neither it nor any of its affiliates or subcontractors will source raw or other materials or services from XPCC or any of its affiliates, or any other company or entity located in China’s Xinjiang region.

15. Monitoring, Documentation and Remediation

Vendor acknowledges that FIGS may in its discretion conduct inspections of the Facilities at which the Products are manufactured or produced to confirm Vendor’s compliance with this Code of Conduct. While FIGS has no obligation to conduct such inspections, it is committed to reviewing and terminating its relationship with any vendor who is unwilling or unable to comply with this Code of Conduct. Facilities must be transparent and maintain all accurate documentation on file. Facilities must authorize FIGS representatives and designated third-party monitors to engage in announced and unannounced monitoring activities to ensure compliance, including confidential worker interviews.

Vendor must respond promptly to reported compliance violations and all corrective action recommendations. Vendor must cooperate with FIGS and its representatives and accept audit findings and recommendations without any attempt or suggestion of bribery or other inappropriate exchange for a more favorable audit result.

Critical or zero tolerance non-compliances must be remediated immediately or may result in termination of these Terms and /or any Purchase Order(s) and purchase contracts or suspension of the business relationship with FIGS.

16. Code of Conduct Termination

FIGS may immediately terminate its business relationship and the Terms and / or any Purchase Order(s) and purchase contracts with Vendor if Vendor or its Partners fail to meet the Standards.