California Supply Chains Act

Hanna Andersson is committed to legal compliance and ethical business practices in all of our operations worldwide. We expect our manufacturers, suppliers and buying agents (our "Suppliers") to share in our commitment and to contractually agree to our Code of Conduct.

We take the risks of slavery and human trafficking in our supply chain very seriously. Like many companies manufacturing or selling products in California, we are required to comply with the California Transparency in Supply Chains Act of 2010. That law was designed to increase the amount of information available to consumers about the efforts of manufacturers and retailers to eliminate the risk of modern day slavery, forced labor, human trafficking and similar human rights violations from their supply chain. Accordingly, below are some examples of how we are working to eliminate that risk from our supply chain.

VERIFICATION OF SUPPLY CHAIN

Hanna Andersson requires all Suppliers to contractually agree to our Code of Conduct which specifically address issues of child labor, forced labor, disciplinary practices, working hours, wages and benefits, discrimination and health and safety. We also reserve the right to pre-approve all sub-contractors used by our Suppliers to manufacture or supply our products and to contractually obligate all sub-contractors to also follow our Code of Conduct.

We regularly review updates to the U.S. Department of Labor's List of Products Produced by Forced or Indentured Child Labor, so we can more closely monitor Suppliers that may operate in the countries listed. Also, Supplier audits are performed annually as described below.

AUDITING

New and existing Suppliers are audited by independent, third-party monitoring firms (approved by Hanna Andersson), which includes evaluating potential risks for human trafficking at the audited production facility based on factors such as geographic location, production processes, and supply chain sector. The auditors are also monitoring to ensure that if the Supplier uses an employment agency, the Supplier and employment agency are in compliance with the local law. Any non-compliance is brought to our attention and we require the Supplier to immediately remedy the issue or we may terminate the relationship. All Suppliers are required to update their audit reports annually but we reserve the right to require more frequent audits depending on the Supplier's performance and track record.

CERTIFICATIONS

Hanna Andersson's Suppliers are contractually obligated to follow our Code of Conduct which specifically prohibits (among other things) their use of child labor and using or purchasing materials or products manufactured by prison, indentured, bonded or other forced labor. Additionally, our Suppliers warrant that all products they manufacture or supply to us are in accordance with all applicable laws, regulations and standards – both of the United States as well as their country of origin. At our periodic supplier conferences, our Suppliers are reminded of and updated on any changes to our Code of Conduct. The Audit section provides descriptions of the consequences for Suppliers who do not comply.

ACCOUNTABILITY

Hanna Andersson has a zero-tolerance policy for involuntary labor, human trafficking, and child labor. Certain violations will result in immediate termination of services including illegal employment of child labor, providing unsafe housing for children of employees and subcontracting with manufacturers and suppliers that violate these terms. For less severe offenses uncovered during an audit, we require the Supplier to take immediate steps to correct the problem. The Supplier is required to inform us on how they are correcting the issue and a Hanna Andersson employee will work directly with the Supplier to ensure there are no recurrences. If the Supplier does not immediately remedy the issue we may terminate the relationship.

TRAINING

Hanna Andersson's Senior Leadership, Sourcing, Tech Design, Logistics, Merchandising and Design teams receive periodic training on our Code of Conduct including the mitigation of risk of human trafficking within supply chains. Periodic strategy meetings between these departments are conducted to discuss Supplier compliance, performance and sourcing strategy.