Conduct

Download Corporate Governance DocumentationCode of Business Conduct and Ethics

CODE OF BUSINESS CONDUCT

Introduction — General Statement of Company Policy

This Code of Business Conduct (the “Code”) is promulgated by the Board of Directors (the “Board”) of NeoPhotonics Corporation and applies to all employees, officers and directors of NeoPhotonics Corporation and each of its majority or wholly owned subsidiaries (collectively, the “Company”).

The Company seeks and encourages its employees to achieve performance with integrity, which includes lawful and ethical behavior at all times. The purpose of this Code is to provide you with a statement of certain key policies and procedures of the Company for you to follow in conducting business in a legally and ethically appropriate manner. This Code is part of a larger process that includes compliance with the corporate policies and procedures themselves, an open relationship between you and your supervisors that is conducive to good business conduct and, above all, your integrity and good judgment.
In that regard, you must:

  • Comply with applicable laws, rules, and regulations;
  • Conduct all dealings with the Company’s customers and suppliers fairly, with honesty and integrity;
  • Ethically handle conflicts of interest, both real and perceived;
  • Produce, or cause to be produced, full, fair, accurate, timely and understandable disclosure in reports and documents that the Company prepares for its security holders, including public filings made in connection therewith, and in other public communications;
  • Protect information, in any form, that belongs to the Company, its customers and suppliers;
  • Protect the Company’s assets and ensure their efficient use and report any suspected incident of fraud, theft or misappropriation immediately; and
  • Never use your position in the Company or use Company assets or information for improper personal gain.

This includes some general principles. You will have to apply these principles to your own specific responsibilities.  If you have any questions about the proper application of the principles or about what is required by the law in any given situation, you must consult with your supervisor or the Company’s Legal Department.

If you violate this Code, you will be subject to disciplinary action, up to and including immediate termination of your employment.  You must report potential or actual violations of this Code to your immediate supervisor, or, alternatively, to the Company’s Legal Counsel or the Chairman of the Company’s Audit Committee. If your situation requires that your identity be kept a secret, your anonymity will be protected. You can use the Company’s reporting program hotline, the instructions for which are located on the Company’s intranet at www.neophotonics.ethicspoint.com to anonymously report concerns, violation of this Code, and violation of any other Company policy.

You will not be subject to disciplinary or retaliatory action for reporting a violation or potential violation in good faith, unless it is your own. However, making known false or malicious reports will be dealt with as a disciplinary matter.

No representation is expressed or implied that the policies stated in this Code are all of the Company’s relevant policies, or that they are a comprehensive, full or complete explanation of the laws or standards of conduct that are applicable to you or the Company. You have a continuing obligation to familiarize yourself with applicable laws and Company policies, including without limitation the Company’s Code of Ethics and Ant-Bribery Policy.

This Code is available on the Company’s intranet and, where appropriate, is also available to the public on the Company’s website at www.neophotonics.com.
Nothing contained in this Code is intended by the Company to be, nor shall it be construed as, an employment agreement.

Lawful and Ethical Behavior

It is the Company’s policy that you conduct business in accordance with applicable federal, state and local laws, rules and regulations and with the laws, rules and regulations of other countries in which the Company does business.  In addition, the Company’s policy demands that you adhere to the highest standard of business ethics and conduct.
You must be alert and sensitive to situations that could result in illegal, unethical, or improper action.  When you are faced with a business decision that seems to have ethical overtones, here are some questions that should be helpful to determine if your actions are proper:

  • Do I have all the necessary facts?
  • Am I informed about all of the legal implications?
  • Who has an important stake in the outcome (e.g., employees, customers, suppliers, etc.), and what is that stake?
  • Does the situation raise ethical issues that go deeper than legal or institutional concerns?
  • What are your options, and which options will produce the most good and do the least harm? Which options respect the dignity of all stakeholders?
  • Would I be proud to explain my actions to my family, fellow employees, customers - or on television?

If you remain uncertain about what to do, if you need advice, or if you have reason to believe that a domestic or foreign law could be violated in connection with Company business or that this Code has been violated in any way, notify your immediate supervisor, the Company’s Legal Counsel or the Chairman of the Audit Committee at once.

Accurate Books and Records

The Company requires full, fair, accurate, timely and understandable recording and reporting of all Company information. You must act in a manner that ensures that all of the Company’s books, records, accounts and financial statements are maintained in reasonable detail, appropriately reflect the Company’s transactions and conform both to applicable legal requirements and to the Company’s system of internal controls. To do so, you must execute and record transactions in accordance with all internal control procedures implemented by Company management.  In addition, if you are in any way involved in preparing the Company's disclosure documents (such as public filings or press releases), you must produce full, fair, accurate, timely and understandable disclosure in such documents.

It is important that you do not create, or participate in the creation, or perpetuation of, any records that are intended to mislead anyone or conceal any improper act or conduct.

Confidential Information

Confidential Company information is an important corporate asset that merits the same protection as the Company’s physical assets. It is very important for you to safeguard the Company’s confidential information and to refuse any improper access to such information entrusted to you or any employee for whatever purpose. You have entered into a non-disclosure or confidentiality agreement detailing your obligations regarding the Company’s confidential information, and you must adhere to this agreement.  You also have an obligation to protect the confidential information provided to the Company by its customers and suppliers and your fellow workers during the course of the Company’s business. They expect your confidentiality — just as the Company expects theirs. For more information, refer to the Company’s Confidentiality Policy available on the Company’s intranet. 

Conflicts of Interest

The Company knows that it can only be truly successful through the diligence and loyalty of its employees. Therefore, you must put the best interests of the Company at the forefront of any work-related activity or decision and ethically handle conflicts of interest. You must use your best judgment in determining whether a conflict of interest exists and then avoid any conduct, activity, relationship or other situation that would create or cause an actual or potential conflict of interest.
While it is not possible to identify every particular activity that might give rise to a conflict of interest, a conflict of interest may exist because of a relationship of yours or of a family member that is inconsistent with the Company’s best interests or could cause a conflict with your ability to perform your job responsibilities. If you or your family members are engaged in any of the activities listed below, then there may be a conflict of interest, and you must disclose the facts concerning this activity to your immediate supervisor or the Company’s Legal Counsel for the Company to address the situation:

  1. Any ownership interest in any supplier, customer or competitor (other than reasonable amounts of stock in publicly traded companies);
  2. Any consulting or employment relationship with any customer, supplier or competitor;
  3. Any outside activity that harms a relationship between the Company and any customer or potential customer, or that interferes with a current or potential contractual relationship;
  4. Any outside business activity that is competitive with any of the Company's businesses;
  5. Any outside activity of any type that is so substantial as to call into question your ability to devote appropriate time and attention to your duties and responsibilities to the Company;
  6. Any service on any board of directors or advisory board of any customer, supplier or competitor unless such board service has been disclosed to the Company;
  7. Any direct supervisory, review or other influential position on the job evaluation, pay or benefits of any close relative;
  8. Any sales or purchases of anything to or from the Company (unless it is pursuant to a routine program of disposal of surplus property that is offered to all employees in general); and
  9. Any situation in which, without proper authorization, you are required or tempted to disclose, or do disclose, any trade secret, confidential or proprietary information or intellectual property of the Company.

If you have any questions regarding activity which may create a conflict of interest, please discuss the situation immediately with your immediate supervisor or the Company’s Legal Counsel. If you know of a conflict of interest that exists elsewhere in the Company, you must disclose such conflict to the Company’s Legal Counsel.

The Company reserves the right to determine when actual or potential conflicts of interest exist, and then to take any action, which in the sole judgment of the Company is needed to prevent the conflict from continuing. Such action may include, but is not limited to, having you divest the conflicting interest or return the benefit or gain received, realigning your duties and responsibilities, or disciplinary action, up to and including immediate termination of your employment.

Gifts and Entertainment

Generally, you and members of your immediate family may not accept gifts, services, discounts or favors from those with whom the Company does business or considers doing business. Gifts, entertainment, favors or gratuities are subject to the following guidelines:

  1. You may accept gifts of nominal value ordinarily used for sales promotion (for example, calendars, appointment books, pens, etc.).
  2. Ordinary “business lunches” or reasonable entertainment consistent with local social and business customs may also be permissible and reasonable in cost and frequency.

If you receive a gift that does not fall within these guidelines, you must report it to your supervisor and return the gift. If return of the gift is not practical, you should give it to the Company for charitable disposition or such other disposition as the Company deems appropriate. For more information, refer to the Company’s Gifts and Entertainment Policy available on the Company’s intranet. 

Corporate Opportunities

You may not use corporate property, information, or position for improper personal gain. You owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises. You are prohibited from competing with the Company or taking advantage for personal gain of any opportunity that is discovered through the use of Company property, information or position. You should report any corporate opportunity to your supervisor or the Company’s Legal Counsel to determine whether the Company desires to take advantage of the opportunity.

If you are an officer, you have an additional obligation not to take advantage for personal gain of any opportunity that the Company may have an interest in pursuing, notwithstanding that your knowledge of such opportunity is obtained independently of your relationship with the Company.

Unauthorized Use of Company Property or Services

You may only use Company property (including the e-mail system) for legitimate business purposes.  You may not use or remove from Company premises any Company property or services for any personal benefit or the personal benefit of anyone else. The Company realizes that sometimes the line between personal and Company benefits is difficult to draw, and sometimes there are both personal and Company benefits in certain activities. Examples include articles of a technical or professional nature that may enhance the stature or reputation of the author and also may have some benefit to the Company, and employee participation in continuing education programs. 

Fair Competition

The Company intends to succeed in the marketplace through superior performance, not by unethical or manipulative practices. You must treat customers and suppliers honestly and fairly. Do not make false or misleading remarks to customers or suppliers about other customers/suppliers or about competitors of the Company, their products or their services, but you may state truthful descriptions of specifications and shortcomings of such products or services.

Antitrust

Most countries, including the United States, have laws prohibiting certain business practices that could inhibit effective competition. Whether termed antitrust, competition, or free trade laws, the rules are designed to keep the marketplace thriving and competitive. These antitrust laws are broad and far-reaching, and touch upon and affect virtually all aspects of the Company’s operations.

The antitrust laws generally prohibit agreements that restrict competition and include agreements between competitors as to pricing, bidding, production, supply and customer practices. These laws also apply to various forms of unfair conduct that may tend to create a monopoly.

The Company supports these laws not only because they are the law but also because it believes in the free market and the idea that healthy competition is essential to its long-term success. As such, you should avoid conduct that violates or appears to violate these laws. In all cases where there is question or doubt about a particular activity or practice, you should contact the Company’s Legal Counsel before taking any action that may fall within the scope of these laws.

Government Business

Special requirements often apply when contracting with any government body (including national, state, provincial, municipal, or other similar government divisions in local jurisdictions). Because government officials are obligated to follow specific codes of conduct and laws, you must take special care in government procurement. Some key requirements for you to follow in doing business with a government are:

  • Accurately representing which Company products are covered by government contracts;
  • Not offering or accepting kickbacks, bribes, gifts, gratuities or anything else of value with the intent of obtaining favorable treatment from the recipient (a gift that is customary in the business sector may be perceived as a bribe by a government official);
  • Not improperly soliciting or obtaining confidential information, such as sealed competitors’ bids, from government officials prior to the award of a contract;
  • Hiring present and former government personnel may only occur in compliance with applicable laws and regulations and after consultation with the Company’s Human Resources Department.
Political Activity

You may not use corporate funds or other assets (including your work time, Company premises, or Company equipment) to make political contributions of any kind to any candidate, political party or in support of any referendum or initiative. This prohibition covers not only direct contributions but also indirect assistance or support of candidates or political parties through the purchase of tickets to special dinners or other fund-raising events, and the furnishing of any other goods, services or equipment to political parties or committees. Political contributions or activities by you on your own behalf and with your own money and on your own time are, of course, permissible. The Company will not reimburse you directly or indirectly for any political contribution or for the cost of attending any political event.

International Business

The Company observes the highest ethical standards in all of its business transactions, including those involving foreign countries. You may not take any action in connection with any international transaction or any action in any foreign country that would be illegal or improper in the U.S. Furthermore, you are required to observe all applicable foreign laws, rules and regulations to which you or the Company may be subject, including foreign tax laws, customs duties and regulations, drug testing, licensing, manufacturing and marketing laws, rules and regulations and currency restrictions. You should not take any actions that are intended to improperly circumvent the application of such laws. Some of the concerns raised by international business are as follows:

1. Foreign Corrupt Practices Act

With limited exceptions, the Foreign Corrupt Practices Act prohibits the Company and you from, among other things, making an offer, payment, promise to pay or authorization of the payment of any money, or offer, gift, promise to give, or authorization of the giving of anything of value to any foreign official, any foreign political party or official thereof or any candidate for foreign political office, or any other person, such as a foreign agent or consultant, knowing that all or a portion of such money or thing of value will be offered, given or promised, directly or indirectly, to any foreign official, any foreign political party or official thereof, or any candidate for foreign political office, for the purpose of (i) influencing any act or decision of such foreign official in his or her official capacity, (ii) inducing such foreign official to do or omit to do any act in violation of the lawful duty of such official, or (iii) securing any improper advantage, or inducing such foreign official to use his or her influence with a foreign government or instrumentality thereof to affect or influence any act or decision of such government or instrumentality, in order to assist the Company in obtaining or retaining business for or with, or directing business to, any person.

If you are asked to make any such payment, you should consult with your supervisor and the Company’s Legal Counsel before taking any action. This policy is covered in more detail in the Company’s Foreign Corrupt Practices Act Policy available on the Company’s intranet.

2. Anti-boycott Laws

U.S. anti-boycott laws prohibit or severely restrict the Company from participating in boycotts against countries friendly to the U.S., and require the Company to report both legal and illegal boycott requests to the U.S. government. If you are involved in selling the Company’s products internationally, you must become familiar with the anti-boycott laws and observe all of their requirements. Further information and guidance can be obtained from the Company’s Legal Counsel.

3. Export Controls

In general, any goods that the Company sells to a customer in a foreign country may require an export license. With respect to exports from the U.S., the definition of “export” is quite broad and can include conversations of a technical nature with a citizen of another country even though that conversation takes place entirely within the U.S. Another example of a possible export under U.S. law would include tours of the Company’s facilities where foreign visitors could obtain technical information.
There are certain statutory provisions which allow exporting of certain products, generally nonmilitary or non-high-technology goods, to the allies of the U.S. without any further license. Export control regulations are, however, quite complex, and if you are involved in any export transaction you must observe at least the following two rules:

  • You must satisfy yourself that there is some regulation or specific export license that covers the export you want to make. This includes exports of technology, as well as exports of goods or services.
  • You must furnish only truthful and accurate information to other Company employees, to the government or to companies that the Company may have hired to facilitate the Company’s export transactions. This includes both information as to the technology in question and information as to the economic value of the exports.

If you are involved in the Company’s export business, you must be reasonably alert to situations in which inaccurate information may have been furnished, either to the Company or to any of the Company’s agents, involving the ultimate destination or use of the goods. This is particularly important for goods of the type that are not permitted to be shipped to certain countries.

If you have any doubt as whether a situation involves an “export” within the meaning of the applicable export control laws, or as to the truth or accuracy of the information being furnished to the Company regarding the ultimate destination or use of products the Company exports, you must contact your supervisor, Company Legal Counsel, or a Company Export Administrator. For more information, refer to the Company’s Export Compliance Policy available on the Company’s intranet.

4. Imports

All goods imported into the U.S. must pass through customs and, except in some limited cases where there are exemptions, a duty must be paid. The amount of that duty is based upon the classification of the goods and the value of the merchandise. You must furnish truthful and accurate information to any customs official or to any agent that the Company hires to facilitate its imports. If you have any questions relating to import of goods, you should contact your supervisor, the Company Legal Counsel, or the Company Export Administrator.

Audits

In some cases, the Company will monitor compliance with its policies by audits. These may be done by the Finance Department, Human Resource Department, the Company’s Legal Counsel, a specially formed committee, or the Company’s outside legal counsel. You are required to cooperate fully with any such audits and to provide truthful and accurate responses to any request.