COMMUNICATION ON PROGRESS:
TEN PRINCIPLES OF UNITED NATIONS GLOBAL COMPACT
CATEGORY PRINCIPLE CLOROX COMPANY POLICIES AND FY20 PERFORMANCE

Human Rights

Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights; and

Principle 2: make sure that they are not complicit in human rights abuses.

The Clorox Code of Conduct documents the ethical and legal standards of behavior and business practices that are required of all our directors, executives and employees around the world. We require all board members and employees to complete training and certify compliance with our code.

Business partners are expected to comply with our Business Partner Code of Conduct. The Business Partner Code of Conduct details our expectations regarding adherence to our Human Rights Commitment and other expectations related to human rights and labor, health and safety, the environment, and business conduct and ethics. This code precludes the use of forced, bonded, or indentured labor or prison labor. As an additional safeguard, the company’s Global Strategic Sourcing (GSS) organization implemented a monitoring program in FY17 using web-crawl technology to monitor all global direct material suppliers for any activities or incidents that would pose risk to the Clorox supply chain. Through an alert system, buyers are notified of any significant findings for appropriate action and/or follow-up. GSS also began annual risk assessments of global suppliers in FY18 based on location, scale, industry and audit history to determine those suppliers at highest risk for social compliance issues, including forced labor and human trafficking. The risk assessment allows us to determine which suppliers should be selected for third-party audits to verify compliance with all principles and standards of the Clorox Business Partner Code of Conduct.

Labor

Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;

Principle 4: the elimination of all forms of forced and compulsory labor;

Principle 5: the effective abolition of child labor; and

Principle 6: the elimination of discrimination in respect of employment and occupation.

Our responsible sourcing and sustainability program covers how we work with our business partners on key issues such as ethical business conduct and practices. This program sets out our expectations with regards to the respect for the human rights, including labor rights, of the workers in our extended supply chain, as these are all integral to the long-term success of our company and our partners. We also have grievance mechanisms available, including the Clorox compliance hotline, to ensure that individuals have a forum to raise concerns about compliance with the standards set out in our Codes of Conduct. And, in support of the California Transparency in Supply Chains Act and UK Modern Slavery Act, we have established formal trainings for our Global Product Supply and GSS teams to help them identify and address potential risks of slavery and human trafficking in our supply chain.

We work with external monitoring systems to enable suppliers to demonstrate compliance with our standards, including Sedex Members Ethical Trade Audit (SMETA). We audit higher risk suppliers leveraging our membership in Sedex and suppliers are required to conduct or share their most recent four pillar (or approved equivalent) audit. The audits, which are conducted by an independent third party, assess suppliers’ activities in the areas of labor rights, health and safety, environmental sustainability and business ethics.

As part of our IGNITE strategy, Clorox has refreshed its Inclusion & Diversity strategy and has set goals to achieve our inclusion and gender and ethnic minority representation targets. We have also identified gender and ethnic pay equity as a key area of focus. The effort is a continuation of our ongoing practice to conduct compensation reviews and pay gap audits, looking at a number of diversity variables, including gender and ethnicity.

We respect the rights of workers to freely associate, organize and bargain collectively in accordance with applicable laws and the customs of the countries in which they are employed, as outlined in our Policy on Employee Freedom of Association. Collective bargaining agreements: U.S.: 6.85%, International: 1.28%, Total Company: 8.13%

Additional information: CEO Letter, Clorox Website: Workplace Safety

Environment

Principle 7: Businesses should support a precautionary approach to environmental challenges;

Principle 8: undertake initiatives to promote greater environmental responsibility; and

Principle 9: encourage the development and diffusion of environmentally friendly technologies.

Advancing environmental sustainability is embedded in our value of doing the right thing. We bring this to life through the environmental goals embedded into our IGNITE strategy. These include setting and achieving science-based targets to reduce greenhouse gas (GHG) emissions in our operations and across our value chain by 2030, sourcing 100% renewable electricity for our U.S. and Canada operations in 2021, and ambitious targets to reduce plastic and other waste by 2030. These efforts are in conjunction with long-standing efforts to reduce our GHG, water and waste impacts across our value chain, from sourcing our raw materials to within our own manufacturing and operations, as well as during consumer use. We are also focusing on packaging innovations, compaction, light-weighting and other material reductions to reduce inputs and the footprint of products. Our commitment to environmental sustainability also includes working to ensure our products do not cause harm to the environment. We assess 100% of our product portfolio for both human and environmental safety.

To accelerate our progress in environmental responsibility, we have established a Sustainability Center responsible for defining, driving and tracking progress against Clorox’s environmental sustainability strategy. Each business unit leadership team is responsible for defining and achieving a strategic sustainability plan for its portfolio of brands that will help deliver corporate IGNITE ESG goals. We have also dedicated resources within our corporate and business development functions to help businesses evaluate and execute on strategic partnerships that help further our sustainability goals. As signatory to the United Nations Global Compact, our sustainability commitments reflect our belief in and support of sustainable development. We are also a signatory of the Ellen MacArthur Foundation’s New Plastics Economy Global Commitment.

As part of our commitment to sustainability, we aim to be transparent about our environmental challenges and opportunities. We report on sustainability in our annual integrated report, and Clorox’s CEO, CFO and General Counsel approve our integrated report.

Additional information: see Scorecard - Planet Third-Party ESG Frameworks – see SASB and TCFD, Clorox Website: Environmental Sustainability, Environmental Sustainability Governance Guidelines, Brands: What We’re Made Of, Commitments and Progress — Message From the CEO

Anti-corruption

Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.

At Clorox, our core values are an intrinsic part of who we are as a company and as individuals. Clorox strictly forbids giving, soliciting, offering and accepting bribes, kickbacks and other prohibited payments by its employees, directors and business partners. We abide by anticorruption laws everywhere we do business in the world, without exception. These laws include the U.S. Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act 2010, as well as all applicable anti-corruption and anti-bribery laws in each country in which we do business. 100% of the company’s leaders and employees must go through anti-corruption training. 100% of the company’s suppliers must adhere to the Business Partner Code of Conduct, which addresses ethical business practices.

The Clorox board of directors meets at least quarterly to review key issues/opportunities impacting the company.

Additional information: Clorox Website: Mission and Values, Corporate Governance Guidelines