Compliance means the observance of all voluntary, supervisory and legally prescribed measures designed to ensure that the business activities of the Degussa Group and its employees are conducted in a manner that complies with the law.

Compliance serves as a trust-building measure to protect the reputation of the Degussa Group and its employees around the world. It should be considered a guiding principle within the Blue Spirit concept which forms part of Degussa’s Global Social Policy.

This Global Code of Conduct summarizes the most important principles and standards of the Degussa Group. All employees must be familiar with these. It also outlines the fundamental ethical and legal duties of Degussa’s employees.

The Global Code of Conduct applies to all organizational units at Degussa as well as subsidiaries and associated companies in which Degussa AG has a direct or indirect stake of more than 50 percent. Companies in which it has a minority interest are advised to observe the principles and standards set out in this Global Code of Conduct.

The scope of this Code of Conduct includes all company guidelines published on the Intranet under Company/Corporate Center and by the departments listed thereunder. Supervisors are responsible for ensuring that their employees are informed of the company guidelines that are relevant for their jobs.

Observance of all laws and regulations
Since it operates internationally, the Degussa Group is required to comply with numerous national and supranational laws and regulations. All business activities and processes must therefore be conducted in accordance with all applicable laws, voluntary obligations and binding regulations relating to the Group’s activities.

All employees are required to observe all applicable laws and other relevant guidelines and agreements. They are not permitted to issue instructions that depart from these principles and result in violation of the stated corporate policy on the conduct of business activities.

Preventive legal counsel
It is essential to avoid risks and to obtain legal counsel before taking any action that could lead to violation of applicable laws and guidelines.

Bribery
Degussa prohibits any form of bribery or attempted bribery by offering or accepting money or valuables.

Gifts and offers of entertainment and other privileges
The following principles must be observed when dealing with business partners and governmental institutions.

Gifts, favors, hospitality and other privileges may only be offered or accepted if they

• do not exceed the bounds of typical business practice in the relevant region

• are not of an inappropriately high value and are not considered or could be construed to be a bribe

• do not violate applicable laws and/or the ethical principles applicable in the Degussa Group

• could not place the Group or employee in an embarrassing situation should the public become aware of them.

In case of doubt, employees must obtain the approval of their supervisor or compliance officer.

Use of company property and resources
Using company resources for personal interests is prohibited. Exceptions to this rule require prior authorization. Corporate guidelines must be observed, especially with regard to the use of telephones, computers, (e.g., the installation of extraneous software), the Internet and e-mail.

Integrity in reporting
All financial reports, accounting documents, research reports, sales reports, expense receipts and documentation, environmental and safety reports and other corporate documents must provide a clear, timely and accurate reflection of the relevant facts and/or the nature of the transaction. Violation of accounting and financial reporting rules, balance sheet offenses and improper documentation will not be tolerated.

It is the responsibility of all relevant employees, with the involvement of departments responsible for financial statements and auditing, to cooperate fully with the Group’s auditors and not to withhold any necessary information from them.

It is the stated policy of the Degussa Group to ensure that information and documents furnished to government and administrative authorities and to stakeholders and the general public are truthful.

External communication
Official statements, especially statements to the media, may only be made by personnel expressly authorized to give such statements.

Equal treatment and fair practice
Every employee is required to take personal responsibility for honest, equal and fair treatment of all business partners. A process based on objective and comprehensible criteria must be used to select suppliers and service providers. This must take account of the fact that business partners are expected to meet requirements comparable to the principles contained in this Code of Conduct. Wherever possible, several offers must be obtained before awarding contracts.

Business incentives
Typical business incentives comprise commission payments, rebates, discounts, free shipment of goods and similar incentives.

Such incentives should be used with great care to ensure compliance with relevant statutory regulations. Full and accurate records must be kept of the use of business incentives.

Payments
Payment for goods and services received through a company that is part of the Degussa Group must be made immediately to the contractual partner. Payment is usually made in the country where the contractual partner’s business is headquartered. Complete or partial payment in cash is prohibited, except where the sums involved are negligible. The appropriated legal counsel must be consulted before making divergent payment arrangements.

Secondary employment
An employee may only take up a second job after obtaining permission from the appropriate personnel department.

Substantial financial interests in competitors, customers and suppliers
Substantial financial interests in a competitor, customer or supplier must be authorized by the employee’s supervisor. Substantial financial interests held by close relatives in a competitor, customer or supplier must be reported to the compliance officer if this involves a potential conflict of interest for the employee. A substantial financial interest is defined as a shareholding of 5 percent or more.

Contracts/business transactions with relatives of Degussa employees
Business transactions may not normally be undertaken with relatives of Group employees. Certain transactions may, however, be permitted by the employee’s supervisor or the Group company’s supervisory committee. In such cases, it must be ensured that the employee in question is not involved in the decision. Close relatives include spouses, parents, children and other relatives and partners who live in the same household as the employee.

Some national laws forbid the use of information that is not meant for the public and/or information that has not yet been made public in connection with the purchase or sale of securities.

This Global Code of Conduct also prohibits the use of insider information gained as a result of employment by the Degussa Group (including information about business partners) either for an employee’s own personal gain or the benefit of a third party.

All information that has not been made available to the public is subject to secrecy and may not be disclosed to unauthorized third parties - either during the employee’s term of employment or thereafter.

The direct or indirect use of confidential business information during the term of employment or thereafter for personal gain or the benefit of a third party or to the disadvantage of the Degussa Group is prohibited. Degussa’s employees are required to actively prevent confidential data from falling into the hands of third parties in compliance with the existing guidelines.

The approval of the Board of Management of Degussa AG must be obtained before making contributions to political parties, organizations closely associated with political parties, political candidates or people holding government offices either out of Group funds or assets or through the provision of services. Other donations may only be made out of an authorized budget. Such budgets and donations must be reported to the appropriate supervisory committee.

Employees may not be urged either directly or indirectly to provide money for party contributions or to support a political party or a person standing for a political office.

Holding events for political parties and other political activities on Group property is prohibited Group-wide.

Employees who hold political offices must report these to the compliance officer if they are likely to attract media attention.

In all business activities, Group employees must respect the national and cultural differences and rights of all individuals with whom they come into contact. It is the stated objective of Degussa not to discriminate against any employee, prospective employee or business partner on the basis of age, race, religion, skin color, gender, disability, national origin, descent, marital status or sexual orientation. Degussa will not tolerate any form of harassment - either toward employees or toward business partners.

Although patterns of behavior and business practices that conflict with this Code of Conduct are tolerated in some countries, we expect all Group employees to exercise the utmost professionalism and integrity and observe Degussa’s corporate principles and guidelines.

For further information, see Degussa’s Global Social Policy.

It is a fundamental principle of the company’s corporate policy that all Group personnel shall conduct business in accordance with the relevant competition law.

In general, the applicable competition and antitrust laws in countries in which Degussa does business prohibit agreements and activities that can hinder trade or competition. Violation of these laws includes, for instance, entering into agreements with competitors in order to fix or control prices, boycott particular suppliers or customers, divide up customers or markets or limit the production or sale of products.

Special care must be taken to ensure that activities undertaken with representatives of other companies cannot be considered or interpreted as violating competition law.

Violation of competition law can result in substantial fines and claims for compensation and damage the Group’s image. This can damage the company and its market position. Further, failure to comply with antitrust regulations may lead to claims for compensation against the personnel involved and/or imprisonment.

Degussa observes all national, multinational and supranational foreign trade regulations. These include customs regulations and trade and production controls.

All Degussa employees are required to observe the legal regulations and Degussa AG’s corporate policy and guidelines on internal export controls.

When assessing unlisted dual use goods (goods that can serve both civilian and military purposes), the decisive fact is how such goods will be used by the customer, not the goods themselves. If there is any uncertainty about the use of such goods, Degussa will refrain from shipping them.

Degussa fully supports all efforts by the international community to prevent the manufacture and proliferation of chemical, biological and nuclear weapons, including launch systems, and to stop international terrorism. To achieve this goal, a number of national and multinational export control regulations are observed. These limit and or even prohibit the export and/or re-export of specific goods, technologies and services to certain countries, organizations and people.

As an international corporation Degussa observes all applicable tax laws and regulations.

Transfer prices are set on the basis of recognized OECD principles, in other words on the same terms as dealings at arm’s length.

Employees working on international assignments must give an undertaking that they will observe the relevant personal tax obligations in line with the Group-wide transfer guidelines.

Employees may not support requests from business partners for action that reduces their tax liability.

Environmental protection, occupational health and safety and quality are essential for the continued development of Degussa, the creation of corporate value, to protect the health of employees and their quality of life and secure the basic necessities of life in the long term.

Degussa is committed to sustainable development and the chemical industry’s world-wide Responsible Care initiative. To implement these principles, the uniform standards set out in the ESHQ Requirements must be observed. These are mandatory throughout the Degussa Group.

At Degussa, the conscientious handling of personnel-related data has always been considered a key value out of the respect for the privacy of fellow human beings. The right of employees and business partners to determine what personal information they make available must always be protected.

Unauthorized collection, use or distribution of personal data on employees and business partners is forbidden. In addition, the corporate guidelines on data protection must be observed.

Extensive use of IT systems means that Degussa’s business activities are dependent to a large extent on the functioning and availability of such systems. It is no longer possible to imagine conducting business without information technology.

The risks that arise from this dependency are increased by the risk of loss, theft and unnoticed alteration of information. For details of how to limit these general risks, the risks of technical failure and the risks arising from the incorrect conduct of personnel, please see the corporate guidelines on IT security.

Responsibilities
The compliance officer is responsible for ensuring Group-wide implementation of compliance rules. This includes ensuring independent and objective treatment of all issues drawn to the attention of the compliance officer. The compliance officer reports directly to the Chairman of the Board of Management but is not subject to directions.

The compliance officer is a direct contact for all employees requiring information or advice on compliance rules. Staff working for the compliance officer are sworn to absolute secrecy. Contacting the compliance officer will not have any negative implications for employees.

To ensure that the Global Code of Conduct is implemented worldwide, the Regional Presidents act as regional compliance officers. In this function they report to the compliance officer.

The compliance officer takes note of all information submitted and looks into it with due attention. All information is treated as strictly confidential. If the compliance officer decides that there is enough initial evidence to suspect violation of the principles contained in the compliance rules, he/she may consult other corporate departments, e.g., Corporate Audit, to clarify the matter, without, however, jeopardizing the confidentiality of the information received.

Responsibility of supervisors for information and control
All supervisors must make sure that their employees are informed of the contents of the Global Code of Conduct. Supervisors must set an example by implementing these standards. Furthermore, as part of their responsibilities, they must make sure that their employees observe these guidelines.

Responsibility of employees to report failure to observe these guidelines
All Group employees are required to inform their supervisor(s) or the compliance officer if they become aware of any violations of this Global Code of Conduct.

Sanctions and consequences
Violating the Global Code of Conduct can lead to disciplinary action and is punishable in accordance with the usual company rules.

Commitment of all employees
A copy of the Global Code of Conduct must be handed to every employee. All employees must sign a compliance letter stating that they understand the behavior described in the Global Code of Conduct and will not engage in prohibited activities. A signed copy of the compliance letter is an essential part of each employee’s personnel file.

Training
Employees throughout the Group will receive regular information on current compliance issues.

Special training will be provided for relevant target groups on issues such as export and terrorism control, antitrust and competition law, the environment, safety and health. Attendance may be mandatory. Records will be kept of attendance at such training sessions.

Compliance at Degussa Group companies
The management of each of Degussa’s Group companies is required to include compliance, the related training measures and any compliance failures on the agenda for a meeting of the company’s management or supervisory board at least once a year.