Declaration of Principles on Human Rights

Our commitment to human rights

We, the companies of the Otto Group, look back on a long tradition as a responsibly operating group of companies. For more than 25 years, we have been linking our economic goals with our responsibility for people and nature. The recognition of and respect for human rights have always been of central importance. This policy statement expresses our traditional values as well as our future responsibility.

Our commitment to human rights

As part of the Otto Group, OTTO (GmbH & Co. KG) is committed to respecting all internationally recognized human rights. Our approach to implementing and managing human rights issues is based on the Guiding Principles on Business and Human Rights (UNGP). In terms of content, our approach is based in particular on the following international standards and frameworks:

• United Nations Universal Declaration of Human Rights (UN UDHR)
• Conventions and recommendations of the International Labor Organization (ILO) on labor and social standards
• United Nations Convention on the Rights of the Child (UN-CNC)
• United Nations Convention on the Elimination of All Forms of Discrimination against Women (UN-CEDAW)
• Guidelines for Multinational Enterprises of the Organization for Economic Cooperation and Development (OECD)

We define concrete requirements for ourselves and our partners

In order to live up to our claim as a group of companies regarding the recognition and respect of human rights, guidelines are implemented throughout the group and thus also at OTTO (GmbH & Co. KG), which express our attitude for ourselves and for our business partners. These guidelines form the basis of our daily actions and take into account not only our own employees and suppliers, but also the employees in our supply chains, our service providers and our customers. At Group level, there are four guidelines in particular:

• With the Sustainability Guideline for Purchasing (sustainability / exclusion criteria for the purchase of retail goods as well as services and non-retail goods in the Otto Group), we set the basis internally for the implementation of our claim. This sustainability guideline forms an essential basis for cooperation with business partners. Therefore, the detailed requirements set out in this guideline with regard to social and environmental aspects are not only important with regard to existing business partners, but also crucial when selecting new business partners.
• Our requirements for our business partners in the area of merchandise procurement are set out in the Business Partner Declaration. Part of these binding requirements is also the amfori BSCI Code of Conduct with the corresponding implementation conditions, which includes social standards, rules on environmental protection and occupational health and safety. Within the framework of accepted standards, social audits in particular are carried out as regular and independent control measures, which represent an important element for risk analysis and any subsequent measures.
• In addition, we have implemented a Code of Conduct for services and non-traded goods, which also includes social standards, rules on environmental protection and occupational safety.
• Finally, the Code of Ethics provides all Otto Group employees with guidance on how to act responsibly. The Code of Ethics is a living document that is developed by employees in a participatory process.

The following company-specific guidelines are also binding for OTTO (GmbH & Co. KG):

• The Merchandise Purchasing Guideline defines the process for the proper purchasing of merchandise for OTTO (GmbH & Co KG).
• The Security Directive regulates the protection and security of persons and assets at the Hamburg-Bramfeld site.

We set priorities where we see human rights risks

We know that appropriate human rights due diligence is an ongoing process. For this reason, we regularly subject our own business operations and our business partners to a risk analysis to identify potential risks and actual violations. In doing so, we analyze where the greatest human rights risks are located and prioritize them. We are supported in this process by selected Otto Group Holding functions, such as Risk Management. This enables us to derive and take appropriate measures to prevent these risks and to eliminate or at least reduce them. As an internationally operating e-commerce company, the focus groups of our human rights due diligence are, in addition to our own employees, above all the people in the supply chains of our retail and non-retail goods.

Through our human rights risk analysis, we identify and prioritize the so-called salient issues, i.e. human rights topics that have the most serious impact on those potentially affected by the company's activities (e.g. employees in the own group, in the supply chain, local residents, customers, etc.).

Comprehensive risk analysis with regard to human rights, labor-related and environmental issues is part of our business processes. We use tools and processes to identify relevant risks and classify and prioritize them according to their severity (e.g. information from social audits, our SmartRisc tool, information from the compliance system, complaints mechanism / whistleblower system). This risk analysis also focuses on risks that may occur with business partners of our business partners. The risk analysis is carried out annually and as required.
To identify these issues, we also draw on our findings from dialogs with people potentially affected by human rights violations. We are currently conducting these discussions mainly as part of multi-stakeholder initiatives and would like to expand them further in the future.

Serious human rights risks for us are: child labor and forced labor, violations of working hours, inadequate pay, discrimination, and inadequate occupational safety. Also part of the consideration are our prioritized ecological risks: Water and air pollution, inadequate waste management, and the use of hazardous chemicals. These are also reflected in our sustainability strategy.
For the identified topics, we derive measures that are intended on the one hand to improve the status quo and on the other hand to preventively avoid situations of human rights concern. Depending on the topic, measures can be derived at Group level, in a network of several Group companies or at individual Group company level.

The Otto Group considers the transfer of knowledge to improve working conditions in the supply chain to be a central and sustainable key to avoiding human rights risks. For this reason, we are committed to training and further education measures for our employees, especially in purchasing, as well as in our supply chain. In addition, we use cooperation in initiatives to join forces with stakeholders from business, politics and civil society. We evaluate the effectiveness of our established measures in order to continuously improve them.

Despite great care with regard to human rights, we are aware that violations can occur. We therefore consider the establishment of complaints mechanisms to be essential, on the one hand as an indicator for recording risks and, on the other hand, in order to uncover actual violations where they occur and to initiate countermeasures. We are already working within the framework of our memberships in the amfori BSCI, the German Textile Alliance and the International Accord to find an industry solution that enables greater access to complaints procedures.

In addition, our whistleblower system provides all people connected with the Otto Group - regardless of whether they are employees, business partners, suppliers or customers - with the opportunity to report compliance violations. A report can be made at any time to corporate-compliance@ottogroup.com, via the digital whistleblower portal or confidentially to the Otto Group ombudsman: As a lawyer, Dr. Rainer Buchert is subject to the legally recognized duty of confidentiality and may not disclose any information to third parties without consent.

We report on our progress

We report annually on our human rights due diligence process. Further information on focal points and business area-specific risks or measures is published by the Otto Group.
The world and our market environment are constantly changing. We therefore continuously review our risk assessment and measures. We also regularly review our processes, this Statement of Principles and our communications and adapt them to changing circumstances as necessary. For example, we are continuously working to report even more transparently on our risks and measures.
The Chairman of the OTTO Divisional Board is responsible for the implementation of and compliance with this statement.