Code of Ethics and Business Conduct Policy
PURPOSE & APPLICATION
Business conduct at Aux Sable shall be guided by the principles of integrity, honesty, fairness and mutual respect. Aux Sable is committed to the highest standards of business conduct and ethics in its dealings with all stakeholders, including, but not limited to, its shareholders, partners, employees, contractors, consultants, landowners, suppliers and shippers, as well as all levels of government, and the public-at-large.
SCOPE OF POLICY
The Code of Business Conduct (the "Code") for the Aux Sable Group of Companies (collectively referred to as "Aux Sable") shall contain clear and concise statements regarding Aux Sable’s expectations and philosophy with respect to business conduct by Aux Sable’s officers, employees, agents and consultants. In this code, the term "employee" should be read to include officers of Aux Sable. In this Code, the term "Aux Sable Leadership Team (ASLT)" includes any senior manager that reports directly to the CEO. The Code is intended to reinforce Aux Sable’s business standards and to identify possible conflicts of interest, which may arise from its day-to-day operations. The Code shall also identify relationships that will be deemed to not constitute conflicts of interest or a violation of the Code.
STANDARDS OF BUSINESS CONDUCT
1. Laws and Regulations
a. All individuals employed or retained by Aux Sable are expected to comply with corporate policies, laws and regulations of all jurisdictions where Aux Sable conducts its business. No individual shall encourage another individual to circumvent applicable laws or regulations nor shall they condone any such violation.
b. Aux Sable adheres to all applicable laws and regulations.
c. Specifically, but not limited to, Aux Sable shall adhere to Foreign Corrupt Practices Act (a U.S. Federal statute) and Corruption of Foreign Public Officials Act (a Canadian Federal statute). This legislation prohibits offering or giving anything of value to foreign government officials or making unlawful political contributions in order to obtain or retain business or to influence an official decision. Liability under this legislation cannot be avoided through the use of agents or third party intermediaries and the penalties for contravention of this legislation are severe. All individuals employed or retained by Aux Sable are expected to comply with this legislation.
d. In dealing with suppliers and competitors of Aux Sable, all individuals employed or retained by Aux Sable shall comply with all anti-trust and fair competition legislation of the jurisdictions where Aux Sable conducts its business. These laws are designed to maintain and encourage competition and fairness in dealings with suppliers and competitors.
2. Fair Treatment of Individuals
All individuals with whom Aux Sable conducts business shall be treated with respect, dignity and equality. Aux Sable shall respect all individuals without bias based on differences in culture, ethnicity and color. Aux Sable is committed to equal opportunity for all employees and applicants for employment without regard to race, color, religion, gender, sexual orientation, age, marital status, national origin, handicap or veteran status. Aux Sable is committed to providing a workplace free from all forms of discrimination, including sexual and other forms of harassment. Suppliers to Aux Sable and all individuals employed or retained by Aux Sable shall comply with all anti-trust and fair competition legislation of the jurisdictions where Aux Sable conducts its business. These laws are designed to maintain and encourage competition and fairness in dealings with shippers, suppliers and competitors.
3. Conflicts of Interest
Aux Sable Employees shall not engage in activities that are, or appear to be, in conflict with the business of Aux Sable or their employment with Aux Sable. An individual’s business conduct on behalf of Aux Sable shall not be influenced, or appear to be influenced, by any personal or family interests. This policy is designed to foster a standard of conduct that reflects well on Aux Sable and its employees and that protects the reputation and financial well-being of Aux Sable. Aside from this, there is no intent to interfere with the personal interests and activities of employees.
Conflicts of interest must be disclosed and resolved (see section 13: Seeking Clarification regarding the Code). In order to avoid the potential for conflict of interest to occur:
a. an employee shall not act as an officer, director, employee, partner, agent or consultant for any of Aux Sable’s competitors, suppliers or contractors; where employees are engaged in other outside employment, Aux Sable should be informed of such external employment to ensure that no conflict exists and to ensure that job performance with Aux Sable is not adversely affected;
b. an employee who serves as a member of the Board of Directors of an outside company that (a) may have an adverse economic impact on Aux Sable or (b) has business practices that would reflect unfavorably on Aux Sable must obtain approval from the CEO of Aux Sable. If the CEO serves as a member of the Board of Directors of an outside company, he must obtain approval from Aux Sable’s Board of Directors. The following factors will be considered regarding such service:
c. an employee shall not contract with or render services to any other firm other than Aux Sable, either directly or indirectly. Employees, other than Officers, may seek a waiver of this provision from their supervisor. Any waiver given shall be in writing, state the extent of the waiver and signed by the Supervisor. Officers must seek a written waiver of provision from the Board of Directors.
d. an employee shall not, directly or beneficially, hold a substantial (>10%) financial or other interest in any business or organization with which Aux Sable competes or has business dealings where that employee or their family could receive a benefit from transactions with Aux Sable
e. an employee shall not participate in a venture directly or beneficially or through acquisition, where Aux Sable has expressed a business interest or where Aux Sable competes, without the prior review and approval of the Audit Committee. Such approval will be based on the material interest in the transaction and the determination if a conflict of interest exists.
f. an employee shall not acquire an interest in property (such as real estate, patent rights, securities or other properties) where Aux Sable has, or might have, an interest;
g. an employee shall not accept a gift, favour, loan, special service, payment or special treatment of any kind ("Benefit") from any individual or organization which conducts or seeks to conduct business with Aux Sable if the receipt of such Benefit is not consistent with good business practice, could be construed in any way as a business inducement, is not of nominal value or if public disclosure of such Benefit would be of detriment to Aux Sable and its stakeholders.
h. In interpreting this section: a person shall not be deemed to be in conflict of interest solely by virtue of their being an employee, manager, officer, trustee or director of one of Aux Sable’s Owners. If conflict exists it may be waived upon approval of the Aux Sable Board of Directors.
4. Fiduciary Responsibility
Aux Sable employees are entrusted with financial authorities commensurate with their business responsibilities and sound business practice. Such delegation is specifically authorized by the Board of Directors and is subject to the dollar limits, re-delegation restrictions, and internal control procedures described in the Delegation of Authority Guides, and Expense Policy and Procedures posted on the Aux Sable Intranet. In exercising delegated Authorities, employees are expected to observe a high standard of care – one suitable for persons entrusted to conduct the financial affairs of others. Regardless of the form of commitment or method of payment (Contract, Purchase Order, Procurement Card, Electronic Transfer, or Check), no person shall authorize a commitment or payment on behalf of Aux Sable other than one, which is for a bona fide Aux Sable business reason and within their delegated authority limits. All transactions shall be conducted in accordance with Aux Sable policies and procedures, shall be supported by appropriate documentation, and shall be accurately recorded in the accounts, as described under Records and Reporting section of this document.
5. Confidential Information
Proprietary or confidential information concerning Aux Sable or its shareholders, partners and associates shall not be disclosed to any party unless expressly authorized. This includes both internally generated information and confidential information received from external sources. Employees shall refer to the External Communication Policy for additional guidance regarding confidential information.
6. Insider Information / Investment Activity
a. Aux Sable shall obey all laws designed to protect the investing public with respect to disclosure of material information, including "material facts" and "material changes".
A "material fact" includes any information concerning Aux Sable or its shareholders or partners that significantly affects, or could reasonably be expected to have a significant effect, on the market price or value or the securities of the company in question.
A "material change" includes any change in the business, operations or capital of Aux Sable that would reasonably be expected to have a significant effect on the market price or value of the securities of a shareholder or partner of Aux Sable.
c. Under securities legislation, the employees of Aux Sable may be considered to be in a "special relationship" with certain shareholders and partners of Aux Sable. As such, employees of Aux Sable shall not be permitted to utilize undisclosed material information (including material facts and material changes) concerning Aux Sable or its shareholders or partners to their personal advantage or the corresponding disadvantage of others in the securities market. Aux Sable also prohibits a person with such information providing it to others, or "tipping", so that such other person may improperly make use of the information.
d. All employees who qualify as registered insiders under applicable security regulations shall comply with security regulations regarding registered insiders, including regulation regarding blackout periods.
7. Gifts and Other Benefits
a. Aux Sable employees, as representatives of Aux Sable, shall not give or offer, directly or indirectly, anything of value to a business associate or government official to influence or reward a specific governmental action. No monetary gifts or loans whatsoever shall be given to a business associate or government official. No other gifts or benefits shall be given or received where such items could be viewed as creating an obligation or influencing a business decision.
b. Where usually accepted business practices permit, and where appropriate to the business responsibilities of the individuals, provision of occasional meals, entertainment or promotional gifts of a nominal value, or charitable or political contributions is acceptable. If an individual is uncertain regarding the appropriateness of a proposed business gift they are encouraged to speak with their supervisor or the Vice-President/General Counsel.
c. The payment or receipt of bribes or "kickbacks" is expressly prohibited. Any such activity will result in dismissal or termination of the business relationship with the party or parties involved.
8. Political and Community Activities and Contributions
a. Aux Sable shall not permit the use or contribution of company time, funds or assets for the benefit of any political party, candidate or official except as permitted by law and authorized in advance by the CEO. Attendance at routine political functions, or at functions widely attended by industry counterparts, is acceptable and does not require the CEO approval. Personal involvement in political or community activities, utilizing personal resources, is acceptable.
b. Aux Sable supports its employees in fulfilling their responsibilities as citizens and participating actively in their country’s political life by joining and supporting the political party of their choice or running for public office. To the extent that elected office does not interfere significantly with their regular duties; employees who have been elected may continue their employment with Aux Sable. However, while in Aux Sable’s employ, individuals holding public office are expected to refrain from taking a position on any issue related to Aux Sable. In order to pursue such interests, employees may apply for, and may be granted, an unpaid leave of absence in order to participate full-time in public life.
c. An employee contemplating running for public office should raise the question with the CEO at an early date so that leave of absence provisions, if necessary, may be considered.
9. Agents, Consultants and Representatives of Aux Sable
This Code applies equally to agents, consultants or representatives acting on Aux Sable’s behalf. Aux Sable shall not retain such parties in an effort to circumvent Aux Sable policies or business values. All such engagements shall be based on merit and appropriately documented.
10. Company Assets
a. Company assets (including, but not limited to, equipment, supplies and vehicles) and intellectual property are to be used for the advancement of Aux Sable’s business and are not to be used for personal use or benefit without written pre-approval of the employee’s immediate supervisor.
b. Unless otherwise provided for and documented in advance, any work products, inventions or technological improvements which are developed or generated by an employee, agent or consultant of Aux Sable’s during their retainer with Aux Sable shall be the property of Aux Sable. Such developments shall be disclosed to Aux Sable immediately. Any patents or copy right applications needed to protect the Aux Sable asset shall be applied for by the employee, agent or consultant of Aux Sable. Upon receipt of such patent or copy right, the employee, agent or consultant shall transfer title of such patent or copy right to Aux Sable.
c. Where such development is outside of Aux Sable’s sphere of interest and Aux Sable indicates in writing that it will not claim a proprietary interest in the development, the individual or entity concerned will be provided with a written statement to that effect. The individual should declare and clarify any such developments that are not clearly outside of Aux Sable’s current and defined business interests.
d. Copyrights and other intellectual property protections, including those relating to software or hardware used by Aux Sable shall be respected. Unlicensed software or unauthorized copies of software shall not be installed or utilized. Reverse engineering of protected software or hardware shall not be permitted.
11. Records and Reporting
Full, prompt and accurate recording of operating and financial information, in accordance with Generally Accepted Accounting Principles is required. No secret or unrecorded funds or assets shall be established or maintained. Provision of intentionally erroneous or misleading documents or invoices to accommodate other parties is also prohibited. Documentation supporting transactions and other accounting entries is to be retained and co-operation with Aux Sable’s auditors is expected at all times. All activities conducted by or on behalf of Aux Sable are subject to audit. Such audit may include a review of any related hard copy or electronic record.
Each employee of Aux Sable shall be provided with a copy of the Code and, as a condition of their initial employment shall be required to acknowledge in writing or electronically their agreement to comply with its provisions. Each employee shall submit annually, to the Vice President of Human Resources/Public Affairs, a written or electronic confirmation of compliance with both the Code and other Corporate Policies.
13. Seeking Clarification regarding the Code
a. Employees are required to strictly adhere to this Code and to Aux Sable’s Corporate Policies, which are posted on the Aux Sable Intranet. Failure to do so may result in an investigation and/or disciplinary action, up to and including termination of employment.
b. The Code is general in nature. Individuals desiring interpretation and clarification regarding the Code should seek guidance from a member of the ASLT.
c. Any waiver of a provision of the Code must be in writing and authorized by a member of the ASLT, except that any waiver granted to a member of the ASLT must be authorized by the CEO and further, any waiver granted to an Officer must be authorized by the Board of Directors. The CEO will be informed of any waiver granted by a member of the ASLT.
d. Individuals who suspect their activities to be in conflict or potential conflict with the Code are encouraged to discuss the matter with a member of the ASLT.
e. Known or suspected violations of the Code or Corporate Policies are to be reported to a member of the ASLT, who will then inform the Vice President of Human Resources/Public Affairs, the Vice President/General Counsel, and the CEO.
f. Where appropriate, Aux Sable may request written disclosure of outside interests to determine compliance with the Code. Alternatively, an individual may wish to provide Aux Sable with such disclosure in advance. Aux Sable, upon review of such disclosure, shall issue a letter indicating that Aux Sable has been made aware of the individual’s actions or involvement and that in the situation as outlined there is no conflict of interest or, alternatively, Aux Sable may specify remedial action required to ensure compliance with the Code.
14. Review and Revision of Policy
a. This Policy shall be reviewed annually at the Owner Representative Audit Committee immediately preceding the Corporation’s Annual General Meeting.
b. The Chief Financial Officer shall present the Policy to the Owner Representative Audit Committee for review including any changes recommended by management.
c. Upon approval by the Owner Representative Audit Committee, the recommended changes, if any, shall be incorporated into the Policy.
d. Approved revised Policy shall be distributed in accordance with the procedures set forth above.