(Effective Date: April 24, 2024)

California Water Service Group and its subsidiaries (together the “Group") conduct business in accordance with the highest standards of corporate leadership and citizenship and expects all its suppliers to act in accordance with the highest standards of professional integrity. We believe such standards are essential to our long-term success. As such, we strive to conduct business solely with suppliers who share our commitment to operating at these highest of standards.

It is for this reason that we make this Supplier Code of Conduct a part of our supplier relationship and incorporate such standards into each supplier agreement. Specifically, in addition to complying with all applicable laws, rules, and regulations, the Group suppliers shall adhere to this Supplier Code of Conduct when doing business with or for Group. This Supplier Code of Conduct shall apply across the entire supply chain of Group suppliers, and Group suppliers must ensure their employees and subcontractors adhere to these standards.  Any non-compliance negatively impacts our business relationship with such non-complaint supplier.

The Group will take no retaliatory action against anyone who raises possible violations of the Supplier Code of Conduct.

Fair Dealing

  • Suppliers shall not engage in coercive, collusive, corrupt, fraudulent, obstructive, or otherwise prohibited practices including during any competitive procurement process.
  • Suppliers shall not seek to obtain competitive advantage through unethical, anticompetitive practices. Suppliers shall not take unfair advantage of anyone through manipulation, exaggeration, concealment, misrepresentation of facts, abuse of confidential or privileged information or any like practices.
  • Suppliers shall not engage in any form of corruption or bribery. Consistent with these prohibitions, suppliers must comply with the U.S. Foreign Corrupt Practices Act (FCPA), and any applicable local anti-corruption and anti-bribery laws. The Group encourages its suppliers to have anti-corruption and anti-bribery policies in place.
  • Suppliers shall not offer or accept bribes, kickbacks, facilitation payments, or any other similar inducements with the expectation of favored treatment.
  • Group employees are prohibited from soliciting or accepting gifts or business courtesies, including services, discounts or anything else of value from Group suppliers when doing so may influence, or be perceived as influencing, a decision or action. Group employees may not accept non-cash gifts from Group suppliers unless that gift is $150 or less in value. Cash gifts or cash equivalents such as gift cards, gift certificates, checks, or loans are never permitted. Immediate family members of the Group employees are subject to the same policy.

Conflicts of Interest

Suppliers and their respective personnel and affiliates shall not have conflicts of interest when conducting business with the Group. A supplier may be considered to have a conflict of interest if:

  • It has at least one or more controlling partners who have a significant financial interest (more than 5% of a business ownership or more than 1% of the outstanding securities of a public company) in another bidder during a competitive procurement by the Group;
  • It uses a relationship to access undisclosed information about a competitive procurement that could influence the decisions of the Group;
  • It participates in more than one bid for a single sourcing event for the Group; or
  • It has a family relationship with a member of the Group’s board of directors, senior executive team, or staff who is directly or indirectly involved in any part of a procurement decision, unless the conflict stemming from this relationship has been disclosed and resolved in a manner acceptable to the Group.
  • Suppliers shall disclose to the Group’s Procurement Department whenever they see an individual who, in the course of performing their work, is, can be, or appears to be influenced to subvert a Group decision-making process for their or others’ gain.
  • Suppliers shall disclose to the Group’s Procurement Department any actual or potential conflicts of interest that impact or may impact their capacity to serve the best interests of the Group. Suppliers may also contact the Group’s Ethics Hotline at (408) 501-1720 with any concerns.

Providing a Safe and Secure Workplace

  • Suppliers must comply with all federal, state and local safety laws, rules and regulations including OSHA regulations.
  • Suppliers shall establish and maintain a safe work environment integrating industry best-practice safety management [processes and procedures] across their businesses.
  • Suppliers shall have a written, zero-tolerance policy regarding the possession and use of alcohol, drugs, fireworks, and firearms while on any Group property or while engaged in work for the Group.
  • Suppliers shall regularly conduct employee health and safety training.

Maintaining Proper Conduct in the Workplace

  • Suppliers shall not discriminate against employees or applicants for employment, and all employment practices and decisions, including those involving recruiting, hiring, transfers, promotions, training, compensation, benefits, discipline and termination, must be conducted without regard to age, sex, race, color, ancestry, religion, creed, citizenship status, disability, national origin, marital status, military status, sexual orientation, gender identity or any other characteristic protected by law or any other non-job-related factor or activity, and must comply with all applicable laws.
  • Suppliers shall prohibit unlawful harassment, including sexual, discriminatory, physical, verbal, psychological, or personal harassment or abusive behavior.
  • While engaged in any business related to the Group, or whenever present on Group property or property of Group’s customers, suppliers shall prohibit conduct of their employees, subcontractors, and representatives that is discriminatory, assaulting, threatening, sexual or of a suggestive nature, hostile, or in any other manner that might reasonably be construed as confrontational.
  • Suppliers shall provide excellent service and care of Group customers and the general public. Providing excellent service and care includes treating all personal interactions with professionalism, friendliness, and courtesy, regardless of the circumstances of the interaction. At no time shall suppliers’ employees or subcontractors use profane language or insult, demean, or otherwise use any disparaging terms, colloquialisms, or racially-biased language in communicating with the Group, its customers, government officials, government employees, or the general public in connection with any business related to the Group.

Safeguarding Confidential Information

  • Confidential Information is any information designated by the Group or its suppliers that could reasonably be considered confidential or proprietary at the time of disclosure, including information relating to critical infrastructure or trade secret information or any other Group intellectual property. These assets include, but are not limited to, physical property, services, business plans, customer information, employee information, vendor information, electronic resources and trade secret information and other Company intellectual property. Intellectual property includes, but is not limited to, patents, copyrights, trademarks/branding and confidential and proprietary business information. Suppliers shall take all reasonable steps, including cybersecurity protections, to safeguard Confidential Information and prevent disclosure of Confidential Information to any third parties without prior approval by the Group.
  • Suppliers shall implement and maintain such internet and electronic information security standards that may be required under agreements with Group and, in the absence of such provisions in any such agreement, shall utilize standards that are acceptable within the industry in which the Group operates.
  • Supplier shall promptly notify Group in writing if Confidential Information pertaining to Group or its customers have been accessed by any third party without prior authorization by the Group.

Environmental Management

  • Suppliers shall conduct business in an environmentally responsible manner that actively mitigates environmental risks, conserves natural resources, and protects the environment.
  • Suppliers shall establish a systematic approach to manage risks, hazards, and opportunities associated with the environment.
  • Suppliers shall be able to demonstrate a culture of continuous improvement to reduce resource consumption. This includes identifying and enabling mitigating factors in areas such as energy consumption, water consumption, materials use and waste, and end-of-life treatment.
  • Suppliers shall introduce product options and alternatives, where applicable, that have added sustainability attributes.
  • Suppliers shall adopt innovative low-carbon solutions to reduce embodied and operational carbon, increase renewable energy use, and use electric vehicles where appropriate.
  • Suppliers shall monitor industry best practices and latest developments in environmental management.
  • Suppliers shall be able to, upon request:
    • Provide the full material content of products supplied to the Group.
    • Provide product energy consumption and product energy efficiency.
    • Supply life-cycle inventory data for supplier processes and products.
    • Describe end of product life processes.
  • To ensure compliance with environmental management standards and product safety, the Group may from time to time conduct on-site audits and assessments of suppliers, or obtain information from any such suppliers about the suppliers’ programs, plans, metrics, and policies.

Human Rights

  • Suppliers shall treat people with respect and dignity, encourage diversity, promote equal opportunity for all, and help create an inclusive and ethical culture.
  • We encourage our suppliers to treat their employees and to interact with their communities in a manner consistent with the United Nations Guiding Principles to Business and Human Rights and the International Labor Organization Declaration on Fundamental Principles and Rights at Work in their business operations. We encourage our Suppliers to develop and publicly disclose a similar commitment to human rights.
  • We expect our Suppliers to immediately inform the group of any known human rights violations in their value and supply chains and to proactively take steps to eradicate violations within their own business and their supply chains.

Labor Practices

  • We expect our suppliers to conform to the International Labor Organization Core Labor Standards, and the California Department of Industrial Relations Sweatfree Code of Conduct.
  • Forced Labor
    • Suppliers shall provide voluntary employment, where workers are free to leave work and terminate their employment or other work status with reasonable notice.
    • Suppliers shall never use involuntary labor or require the payment of fees or the surrendering of identification (immigration or work permit documents) as a condition of employment.
    • Suppliers shall never traffic workers or in any other way exploit workers by means of threat, force, coercion, abduction, or fraud.
  • Child Labor
    • Suppliers shall ensure that child labor is never used. Child labor refers to any person under the minimum legal age for employment where the work is performed. Under no circumstances shall a supplier permit children to perform work that exposes them to undue risks that can harm their physical, mental, or emotional development or improperly interfere with their education or vocational needs.
  • Working Hours and Wages
    • Suppliers shall follow all applicable laws and regulations regarding wages, working hours, days of rest, and worker benefits, such as a maximum of 60 hours of work per week (48 regular hours of work per week and a maximum of 12 hours of voluntary overtime), a rest period of at least 24 hours every seven days, and permit no exceptions to these requirements unless they are clearly defined and allowed by national laws and workers' agreements.
  • Collective Bargaining
    • Suppliers shall recognize and respect the rights of employees to have freedom of association and collective bargaining in accordance with applicable laws.
    • Suppliers shall not penalize or subject to harassment or intimidation workers for the non-violent exercise of their right to join or refrain from joining such associations and worker organizations.

Quality

  • Group is committed to providing the highest quality of services to its Customers. Group expects our suppliers to ensure the quality, safety, and performance of the products and services they provide.

Supplier Code of Conduct Flow Down

  • We encourage our suppliers to have practices in place to support compliance with laws, regulations, and expectations related to, or addressed expressly within the Supplier Code of Conduct. We encourage our suppliers to implement their own written code of conduct, and to apply the principles of such code of conduct to the entities that furnish goods and services to the supplier.

Supplier Diversity

  • It is Group policy that diverse business enterprises, including those categories recognized under the California Public Utilities Commission General Order 156 (for California Water Service Company) and Federal Subcontracting Programs (for all Group companies) shall have the maximum practicable opportunity to participate in the performance of contracts.
  • Suppliers agree to use their best efforts to award subcontracts (when applicable and available, and as required by contract with a Group company) with such diverse suppliers consistent with the efficient performance of their contract, and accurately report diverse subcontracting.

Supplier Compliance

  • Suppliers shall provide an anonymous complaint mechanism for workers to report workplaces grievances.
  • Suppliers should keep accurate and auditable records of all transactions with Group. Suppliers are expected to follow a record retention policy that meets industry standards by which the Group operates.
  • If a supplier believes that an employee or someone acting on the Group’s behalf has engaged in illegal, unethical or otherwise improper conduct or violated this Supplier Code of Conduct, the supplier shall immediately report this concern to:

Shawn C. Bunting
Senior Vice President, General Counsel
Address: 1720 N. First Street, San Jose, CA 95112
Email: sbunting@calwater.com

Ethics Hotline, External: (408) 501-1720 | Internal: extension 80000

  • We reserve the right to verify compliance with this Supplier Code of Conduct. Suppliers shall maintain documentation to demonstrate their compliance and provide such documentation and any other relevant information to the Group upon request.
  • A supplier’s relationship with the Group will not be affected by a good faith report of potential misconduct.

Approved April 24, 2024