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California Transparency in Supply Chains Act

Disclosure under the California Transparency in Supply Chains Act of 2012

Saks Incorporated is committed to legal compliance and ethical business practices in all our operations worldwide and is firm in our resolve to do business only with those Vendors, suppliers, and contractors which we believe share in that commitment. In support of this commitment, Saks Incorporated demands that all individuals or organizations who provide direct and indirect materials and services, as well as all suppliers, contractors, consultants and other intermediaries (herein referred to as “Vendors”) agree to follow our Business Practice Standards as condition of the business relationship.

We require our Vendors to comply with all applicable laws and regulations mandated by the country in which the merchandise or product is manufactured, including but not limited to laws against child labor, forced labor and unsafe working conditions.

In accordance with the requirements of the California Transparency Supply Chain Act of 2012 (CASB 657), Saks provides the following disclosure:

Saks monitors foreign vendor orders that are being produced in high- and medium-risk regions of the world. For these orders, Saks requires vendors to participate in our social compliance program, which may include but is not limited to disclosure of factories, submission of a third party audit report conducted by an accredited audit standard or participation in a social compliance inspection through an independent third party auditing firm. Auditors are required to use a pre-defined, specific and detailed audit checklist which is based on the Hudson’s Bay Company’s Supplier Code of Conduct (the “Code”) when inspecting a factory. The Code is based on the Universal Declaration of Human Rights and the International Labor Standards, which includes a focus on monitoring for child, indentured and/or forced labor as well as harsh and inhumane treatment at the factories. Auditors are required to have appropriate training and credentials to ensure that generally accepted auditing principles are utilized. Audits are completed on an annual basis unless determined that more frequent intervals are appropriate.

During an audit, the factory is required to share records, allow the auditor to freely tour the production facility, and cooperate completely with the auditor at all times. Saks maintains internal procedures to clarify steps to be taken when Vendors, factories, and/or sub-contractors fail to meet the Company standards up to and including termination of the relationship with the Vendor and/or factory (as a matter of practice, our vendors are usually not related to the factories, and they work with a number of them at one time). All claims related to non-compliance to the standards are discussed with the auditing firm and reviewed by Associates with their Manager to ensure adequate and responsible handling.

In addition, Saks expects that all Associates follow the Saks Code of Business Conduct, the Saks Vendor Standards Manual, and established Saks Business Practice Standards. In addition, Saks provides specific training to Associates responsible for managing social compliance programs that includes education on addressing issues of forced labor and/or inhumane conditions in the Company’s supply chain.