2016 CORPORATE RESPONSIBILITY REPORTSUSTAINABLE GROWTH2016 CORPORATE RESPONSIBILITY REPORT<img alt="" src="/SiteCollectionImages/CSR/ethics_anticorruption.jpg" style="BORDER:0px solid;" />

 

 

Sustainable Growth > Ethics & Anti-Corruption<div class="restrictInterior generalContent"><div class="ms-rtestate-read ms-rte-embedcode ms-rte-embedil ms-rtestate-notify s4-wpActive" unselectable="on"><div class="restrictInterior generalContent" unselectable="on"><h1 unselectable="on">Ethics & Anti-Corruption</h1><div unselectable="on">Operating with Integrity and Openness—one of our core values—remains paramount to our business. Our proactive approach to ethics and compliance strengthens Forest City’s relationship with our communities and partners. Through the guiding principles of Forest City’s policies and programs, our associates uphold the utmost integrity in their work every day.</div><div unselectable="on">Underscoring the importance of behaving in an ethical manner at all times, we require all associates and board members to annually review and sign our Code of Legal and Ethical Conduct. Each year, our Legal and Human Resources teams conduct and provide training sessions focused on key ethical behaviors and legal requirements on topics such as insider trading, hedging and pledging, fair disclosures and records retention. In addition, we conduct targeted training on important and relevant ethics and compliance issues. In 2016, we reached our goal of 100 percent compliance with the Code of Conduct among all 2,078 Forest City associates and board members.</div><div unselectable="on">In December 2016, Forest City entered into an agreement to eliminate the company's dual-class share structure and also announced a number of other corporate governance enhancements and Board changes. At the company's 2017 Annual Meeting, stockholders approved all matters before them, including the proposal to reclassify the dual-class share structure and create a single class of stock with "one share, one vote" rights.</div><h2 unselectable="on">Supporting Policies & Procedures</h2><div unselectable="on">In addition to our Code of Legal and Ethical Conduct, we maintain several specific policies and procedures governing our approach to ethics and compliance, including policies and procedures governing insider trading, related party transactions, conflicts of interest, lobbying and political contributions, Regulation FD, social media, anti-harassment and anti-discrimination, as well as other important topics. These policies, among others, uphold our approach to accountability, legal compliance, ethical behavior and transparency at the executive level. Also, complying with the Sarbanes-Oxley Act, all senior financial officers receive additional training specific to their roles and responsibilities. In addition, certain senior financial officers must annually acknowledge receipt of and compliance with a separate Senior Financial Officer Code of Ethical Conduct. Our Internal Audit department reviews our regulatory compliance on a quarterly basis and conducts an annual assessment to ensure our approach and performance surrounding ethics and compliance remains effective. We take seriously any accusations of wrongdoing within our organization and act quickly to take corrective measures.</div><div unselectable="on">Externally, we require each new supplier and all existing major suppliers to comply with our Supplier Code of Conduct. Forest City actively manages and evaluates supplier performance against the terms of this policy, and we evaluate our vendor agreements on a regular basis to confirm they remain mutually beneficial to Forest City and our vendors. We have also adopted substantial enhancements to the Supplier Code of Conduct, which now features additional standards related to health and human safety, and labor and human rights, and enhanced provisions related to gifts and gratuities.</div><h2 unselectable="on">Ethics Hotline</h2><div unselectable="on">We partner with Global Compliance as the third-party operator of our ethics hotline, which is available 24 hours a day, seven days a week, 365 days a year. The hotline serves as a venue for associates, partners, customers and vendors to anonymously report concerns or behaviors of any kind that they feel may violate Forest City’s policies or practices, or federal, state or local regulations. Each month, both the Legal Department and the Audit Committee of the Board receive an anonymous summary report of all calls to the hotline. We communicate all ethical or legal concerns shared on the hotline to Human Resources, Legal or individual company officers.</div><div unselectable="on">Our system allows hotline callers to receive updates on whether their matter has been resolved while maintaining anonymity. Forest City has a strict non-retaliation policy for any reports of legal or ethical concerns. In 2016, our overall call volume remained low, and the most common concerns raised on the ethics hotline included allegations of workplace misconduct, such as favoritism and harassment. In compliance with our Audit Committee-approved Investigation Policy, our General Counsel continues to review each call and take appropriate action as needed.</div><h2 unselectable="on">2016 Ethics & Compliance Goals</h2><div unselectable="on"> <strong unselectable="on">Goal 1</strong>  Achieve 100 percent compliance with applicable Code of Legal and Ethical Conduct and other legal policy acknowledgments<br unselectable="on"> <strong unselectable="on">Goal 2</strong>  Effectively train associates on key components of Forest City’s ethical framework</div></div></div></div>Ethics & Anti-CorruptionSustainable Growth > Ethics & Anti-Corruption