CAPITAL FILTRATIONS INC
It is Capital Filtrations Inc's policy to conduct all of its business honestly and ethically. Capital Filtrations Inc takes a zero-tolerance approach to bribery and corruption and is committed to acting professionally, fairly, and with integrity in all its business dealings and relationships. It is the goal of Capital Filtrations Inc to avoid acts that might reflect adversely upon the integrity and reputation of the Company.
Individuals involved in corrupt activity may be fined or sentenced to imprisonment. Further, if Capital Filtrations Inc or any of its employees or associated persons (e.g. contractors, agents, or subsidiaries) is found to have taken part in corruption, Capital Filtrations Inc could face an unlimited fine, and it could face serious damage to its reputation both in the public markets and in the countries in which it operates. Capital Filtrations Inc, therefore, takes its legal responsibilities very seriously.
Capital Filtrations Inc is committed to upholding all laws relevant to countering bribery and corruption in each of the jurisdictions in which it operates. As the anti-corruption laws of the US have extraterritorial application, Capital Filtrations Inc, its employees, and associated persons will be bound by the most stringent requirements of these laws in respect of its conduct in all jurisdictions they operate, even if such conduct would otherwise be permitted by the local law of a particular jurisdiction.
The purpose of this Policy is to:
set out the responsibilities of Capital Filtrations Inc, and all individuals who work for Capital Filtrations Inc, in observing and upholding the Company's position on bribery and corruption; and
provide information and guidance to those individuals working for Capital Filtrations Inc on how to recognize and deal with bribery and corruption issues.
In this Policy, "third party" means any individual or organization with whom you may come into contact during the course of your work for Capital Filtrations Inc, and includes actual and potential customers, suppliers, distributors, business contacts, agents, advisers, and government and public bodies, including their advisors, representatives and officials, politicians and political parties.
APPLICATION OF THE POLICY
The Policy applies to all directors, officers, employees, family members, consultants, and contractors of Capital Filtrations Inc. Compliance with this Policy constitutes terms of service for each director, conditions of employment for each officer and employee, and conditions of providing services to Capital Filtrations Inc for each consultant and contractor.
This Policy extends across all of the Company's business dealings and in all countries and territories in which the Company operates. All persons covered by this Policy, in discharging their duties on behalf of Capital Filtrations Inc, are required to comply with the laws, rules, and regulations applicable in the location in which Capital Filtrations Inc is performing business activities, and in particular with respect to anti-bribery and corruption laws, rules and regulations. Where uncertainty or ambiguity exists, please contact the Compliance Officer who may seek further legal advice.
FORMS OF BRIBERY AND CORRUPTION
A bribe is an inducement or reward offered, promised, or provided in order to gain any commercial, contractual, regulatory or business, or personal advantage.
An inducement is something that helps to bring about an action or desired result.
A business advantage means that Capital Filtrations Inc is placed in a better position (financially, economically, or reputationally, or in any other beneficial way) either than its competitors or than it would otherwise have been had the bribery or corruption not taken place.
Kickbacks are payment of any portion of a contract made to employees of another contracting party or the utilization of other techniques, such as subcontracts, purchase orders, or consulting agreements, to channel payment to public officials, political parties, party officials or political candidates, to employees of another contracting party, or their relatives or business associates.
Extortion means to directly or indirectly demand or accept a bribe, facilitation payment, or kickback.
ANTI-BRIBERY AND CORRUPTION STANDARDS
It is prohibited for Capital Filtrations Inc or its directors, officers, employees, or contractors to:
give, promise to give, or offer, a payment, gift, or hospitality to a third party or otherwise engage in or permit a bribery offense to occur, with the expectation or hope that advantage in business will be received, or to reward a business advantage already
given give, promise to give, or offer, a payment, gift, or hospitality to a third party to "facilitate" or expedite a routine procedure.
accept a payment, gift, or hospitality from a third party if you know or suspect that it is offered or provided with an expectation that a business advantage will be provided by the Company in return.
threaten or retaliate against another employee or worker who has refused to commit a bribery offense or who has raised concerns under this Policy.
engage in any activity that might lead to a breach of this Policy.
Non-compliance with the Policy may result in criminal or civil penalties which will vary according to the offense. An employee acting in contravention of the Policy will also face disciplinary action up to and including summary dismissal.
GIFTS AND HOSPITALITY
This Policy does not prohibit normal and appropriate hospitality (given or received, in accordance with Capital Filtrations Inc’s Gifts & Hospitality Policy) to or from third parties.
Capital Filtrations Inc’s Gifts & Hospitality Policy sets out when it is, and is not, appropriate for you to make or receive gifts and/or hospitality from a third party.
The following is a list of "red flags" that may indicate the possible existence of corrupt practices and should be kept in mind by all those subject to this Policy:
Use of an agent with a poor reputation or with links to a foreign government.
Unusually large commission payments or commission payments where the agent does not appear to have provided significant services.
Cash payments, or payments made without a paper trail or without compliance with normal internal controls.
Unusual bonuses to foreign personnel for which there is little supporting documentation.
Payments are to be made through third-party countries or to offshore accounts.
Private meetings requested by public contractors or companies hoping to tender for contracts.
Not following Capital Filtrations Inc policies or procedures – abusing the decision-making process.
Unexplained preferences for certain sub-contractors.
Invoices rendered or paid more than contractual amounts.
RESPONSIBILITIES UNDER THE POLICY
All directors, officers, employees, consultants, and contractors of Capital Filtrations Inc must read, understand and comply with this Policy and the following related policies:
Code of Business Conduct & Ethics
Whistle Blowing Policy
Gifts & Hospitality Policy
All directors, officers, employees, consultants, and contractors of Capital Filtrations Inc must participate in all training provided by the Company.
The prevention, detection, and reporting of bribery offenses and other forms of corruption are the responsibility of all those working for Capital Filtrations Inc or under its control. All such persons are required to avoid any activity that might lead to, or suggest, a breach of this Policy.
If you are asked to make a payment on the Company's behalf, you should always be mindful of what the payment is for and whether the amount requested is proportionate to the goods or services provided. You should always ask for a receipt that details the reason for the payment. If you have any suspicions, concerns, or queries regarding a payment, you should raise these with the Compliance Officer, wherever possible, before taking any action.
All directors, officers, employees, consultants, and contractors of Capital Filtrations Inc must notify the Compliance Officer or disclose under Capital Filtrations Inc Whistle Blower Policy as soon as possible if they believe or suspect that an action is in conflict with this Policy has occurred, or may occur in the future, or has been solicited by any person.
Any person who breaches this Policy will face disciplinary action, which could result in dismissal for gross misconduct. Capital Filtrations Inc reserves its right to terminate its contractual relationship with other persons if they breach this Policy.
It is a violation of the Policy to make any corrupt payments through any subsidiaries, agents, intermediaries, business partners, contractors, or suppliers (individuals or organizations) of Capital Filtrations Inc ("Associated Entities") or to make any payment to a third party where there is any reason to believe that all or a portion of the payment will go towards a bribe.
The relationship with agents and other intermediaries must be fully documented using the Company's standard terms and conditions for appointment, which shall include compliance with the Policy and prohibit Associated Entities from making or receiving any bribes on the Company's behalf.
Compensation paid to Associated Entities must be appropriate and justifiable and for the purpose of legitimate services rendered. Associated Entities are required to keep proper books and records available for inspection by the Company, its auditors, and/or investigating authorities.
Capital Filtrations Inc will be required to develop, implement, monitor, and maintain a system of internal controls to facilitate compliance with this Policy, as well as to foster a culture of integrity and maintain high ethical standards throughout the Company.
Capital Filtrations Inc must keep financial records and have appropriate internal controls in place which will evidence the business reason for making payments to third parties, for a period of 6 years.
All transactions must be executed in accordance with management’s general or specific authorization. Transactions must be recorded as necessary to permit preparation of financial statements in conformity with International Financial Reporting Standards, for a period of 6 years.
All business partners of the Company should have in place internal controls and procedures that fit these criteria and enhance compliance with this Policy. The Company will maintain available for inspection accurate books and records that fairly document all financial transactions, risk assessments, and due diligence.
All directors, officers, employees, consultants, and contractors of Capital Filtrations Inc must seek approval for any gifts given or received and record them on the Gift Register in accordance with the Gifts & Hospitality Policy.
All expenses incurred to third parties relating to hospitality, gifts, or expenses must be submitted in accordance with the relevant Capital Filtrations Inc policies and the reason for the expenditure must be specifically recorded.
All accounts, invoices, memoranda, and other documents and records relating to dealings with third parties should be prepared and maintained with strict accuracy and completeness. No accounts or cash funds may be kept "off-book" to facilitate or conceal improper payments. The use of false documents and invoices is prohibited, as is the making of inadequate, ambiguous, or deceptive bookkeeping entries and any other accounting procedure, technique, or device that would hide or otherwise disguise illegal payments.
To ensure the effectiveness of internal controls, business and finance personnel of the Company will review transactions and expense/payment requests for warning signs that signal an inadequate commercial basis or present excessive risks.
REPORTING VIOLATIONS OF THIS POLICY – WHISTLEBLOWER POLICY
All directors, officers, employees, consultants, and contractors must adhere to Capital Filtrations Inc's commitment to conduct its business and affairs lawfully and ethically. All directors, officers, employees, consultants, and contractors are encouraged to raise any queries with the Compliance Officer.
In addition, any director, officer, employee, consultant, and contractor of Capital Filtrations Inc who becomes aware of any instance where Capital Filtrations Inc receives a solicitation to engage in any activity prohibited by this Policy, or who becomes aware of any information suggesting that a violation of this Policy has occurred or is about to occur is required to report it to the Compliance Officer.
Persons who refuse to engage in or permit a bribery offense, or who raise legal or ethical concerns or report another's wrongdoing, are sometimes worried about possible repercussions. Capital Filtrations Inc aims to encourage openness and will support anyone who raises genuine concerns in good faith under this Policy, even if they turn out to be mistaken.
No directors, officers, employees, consultants, and contractors of Capital Filtrations Inc will suffer demotion, penalty, or other adverse consequences for refusing to engage in or permit a bribery offense or for raising concerns or for reporting possible wrongdoing, even if it may result in the Company losing business or otherwise suffering a disadvantage. Capital Filtrations Inc prohibits retaliatory action against any person who raises a concern in good faith.
INVESTIGATION AND DOCUMENTATION OF REPORTS
Any report of solicitations to engage in a prohibited act or possible violation of the Policy will be investigated initially by the Compliance Officer. Where the matter is deemed potentially serious it will be promptly reported to the Chief Executive Officer, the Chairman of the Audit Committee, and where appropriate, to the Chairman of the Board, and the following procedure will be followed:
The report will be recorded and an investigative file established. In the case of an oral report, the party receiving the report is also to prepare a written summary.
The Chairman of the Audit Committee will promptly commission the conduct of an investigation. At the election of the Chairman of the Audit Committee, the investigation may be conducted by Capital Filtrations Inc personnel, or by outside counsel, accountants, or other persons employed by the Chairman of the Audit Committee. The investigation will document all relevant facts, including persons involved, times, and dates. The Chief Executive Officer or the Chairman of the Audit Committee shall advise the Board of Directors of the existence of an investigation.
The identity of a person filing a report will be treated as confidential to the extent possible, and only revealed on a need-to-know basis or as required by law or court order.
On completion of the investigation, a written investigative report will be provided by the persons employed to investigate the Chief Executive Officer and the Chairman of the Audit Committee. If the investigation has documented unlawful, violative, or other questionable conduct, the Chief Executive Officer or the Chairman of the Audit Committee will advise the Board of Directors of the matter.
If any unlawful, violative, or other questionable conduct is discovered, the Chief Executive Officer shall cause to be taken such remedial action as the Board of Directors deems appropriate under the circumstances to achieve compliance with the Policy and applicable law, and to otherwise remedy any unlawful, violative or other questionable conduct. The persons employed to conduct the investigation shall prepare, or cause to be prepared, a written summary of the remedial action taken.
Standard business risk assessments will be conducted on an annual basis to determine the level of controls necessary for a particular aspect of the Company’s operations, including in relation to procurement and tender processes.
Risk assessments should consider:
"country risk", which includes an assessment of the overall risks of corruption and bribery associated with a particular jurisdiction;
"transactional risks", which includes an assessment of the risks associated with a business transaction undertaken by the Company or its Associated Entities;
"business opportunity risks", which includes the risk that pursuing or obtaining business opportunities may result in acts of bribery or corruption; and
"business partnership risks", which includes risks deriving from relationships with or partnership with other Associated Entities.
Specific policies and procedures will be adapted and implemented to proportionately address the risks identified above as they arise.
records and documentation must be kept of each risk assessment as part of the system of internal controls and record-keeping.
The Company will conduct appropriate due diligence to inform risk assessments and ensure compliance with the Policy. While the list is not exhaustive, and warning signs will vary by the nature of the transaction, expense/payment request, geographical market, or business line, common warning signs that should be considered as part of any due diligence include:
• that an Associated Entity has a current business, family, or some other close personal relationship with a customer or government official, has recently been a customer or government official, or is qualified only based on his influence over a customer or government official;
• a customer or government official recommends or insists on the use of a certain business partner or Associated Entity;
• an Associated Entity refuses to agree to anti-corruption contractual terms, uses a shell company or other unorthodox corporate structure, insists on unusual or suspicious contracting procedures, refuses to divulge the identity of its owners, or requests that its agreement be backdated or altered in some way to falsify information;
• an Associated Entity has a poor reputation or has