ΛCBC Code of Ethics

Definitions and acronyms

Sensitive activities: company activities where opportunities, conditions, and instruments for the perpetration of offences may arise.

National Collective Employment Contract: The National Collective Employment Contract applicable to the employees and executives of ACBC S.R.L. or, respectively, the National Collective Employment Contract of Trade and the National Collective Employment Contract of Executives of Companies Manufacturing Goods and Services.

Code of Conduct for the Supply Chain: The Code of Conduct expressing the minimum social, environmental, and ethical requirements expected from the Company’s Suppliers.

Code of Ethics: A code of ethics is a set of principles designed to guide professionals and encourage them to conduct business honestly and with integrity.

Board of Directors (hereinafter also the “BoD” or the “Management Body”): the Board of Directors of ACBC S.R.L.

Collaborators: subjects who collaborate with the Company without a direct employment relationship, sales representatives, and providers of goods and services, which may be continuous or occasional, as well as those, who, on the basis of specific mandates and proxies, represent the Company among third parties.

Decree or Legislative Decree no. 231/2001: Legislative Decree no. 231 of 8 June 2001 which lays down the “Provisions on the administrative liability of legal persons, companies and associations, including those without legal personality, pursuant to art. 11 of Law no. 300 of 29 September 2000”, in the contents at various times in force.

Recipients: the entities to which the provisions of this Model shall apply.

Employees: natural persons employed by ACBC S.R.L. to provide a service under the supervision of the managerial positions of the company.

Suppliers: subjects who supply goods or services to ACBC S.R.L.

Officer of public services: “person in charge of a public service”, intended as activities governed in the same manner as public function but which do not entail the powers typically assigned to a Public Official (Italian Criminal Code, art. 358).

Organization, management and control model (hereinafter also the “Model”): this Model of organization, management and control adopted pursuant to art. 6 and art. 7 of Legislative Decree no. 231/2001.

Surveillance Body (hereinafter also the “Body” or the “SB”): a Body within the Entity with autonomous powers of initiative and control, entrusted with the task of supervising implementation and observance of the Model, as well as of informing the Board of Directors of any update requirements thereof.

Public Administration, PA or Public Bodies: Public Administration, including its officers and persons entrusted with public service.

Public Official: Individuals who “perform a legislative, judicial or administrative public function” (Italian Criminal Code, art. 357).

Offences: offences subject to the provisions of Legislative Decree no. 231/2001, as subsequently amended and supplemented.

Company (hereinafter also “ACBC”): ACBC S.R.L. with registered office in Milan, Via G. Cavalcanti 5, 20127, Milano.

 

Purpose of the document

As the first B Corp in footwear, ACBC S.R.L. aims at developing a business model that not only envisions business growth but also takes into consideration the impact of the company on the environment and the community. In this sense, the company is committed to conducting its business and affairs with integrity and in accordance with high ethical and legal standards. This Business Code of Ethics provides a set of ethical guidelines to guide each director, employee, and officer of the Company in the conduct of their actions and constitutes conditions of employment with the company. It is also expected that suppliers, consultants, agents, and other business partners of the company will also abide by the ethical standards reflected in this Code of Conduct.

Commitment by the ACBC Executive Committee

ACBC S.R.L. (hereinafter also “ACBC” or the “Company”) produces and markets footwear, clothing, and accessories with a high content of responsible materials, including but not limited to recycled, biobased and biodegradable materials. The company is also globally recognized for supporting brands in the reduction of their environmental impact through consulting services and production collaborations.

ACBC is a smart company which envisions a future in which the fashion sector uses cutting-edge technology and implements circularity practices towards the common goal of reducing the carbon emissions leading to global warming. This vision is consistent with the objective of the Paris Climate Agreement of the United Nations Framework Convention on Climate Change to limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.

In this perspective, the brand continues to improve and develop new eco-friendly technologies and solutions in view of generating an environmentally friendly business model.

Each collection is therefore carefully designed to guarantee the creation of comfortable, beautiful, and environmentally friendly sneakers.

The global visibility of its products allows the company to partner with no-profit organizations and international brands, with the common goal to spread the awareness on environmental issues.

The company ensures that the manufacturing practices of the company are respectful of the environment and communities by requiring social and environmental certifications to its production facilities and suppliers.

The company’s head office is in Milan, Via G. Cavalcanti 5, 20127, Milano.

Governance Rights
The Governance Rights of ACBC are defined in the shareholders’ agreement between the shareholders. The Company relies on a traditional top-down organization.

The Board of Directors, comprised of seven members, has a key role in the corporate governance system; it makes decisions on important strategic, economic, or financial decisions. The Board of Directors appoints the Chairman and the Chief Executive Officer.

The Board is entrusted with ordinary and extraordinary management tasks and has the power to carry out any actions it deems appropriate to pursue and achieve the corporate objectives. The voting system applied to this Board is 50% plus one.

The Board of Statutory Auditors, will be in charge of monitoring the compliance with the law, the observance of the principles of fair administration, the adequacy of the Company’s organizational structure, the internal control system and the accounting and administrative system. It is integrated by three full members and two alternate members from the fiscal year 2020/2021.

The statutory financial statement will be audited by an Auditing Firm.

Internal control system

In constructing its Model, ACBC S.R.L. considered the governance tools of the Company’s organization, which ensure it operates properly, mainly:

  • Code of Ethics – This document includes a set of rules of conduct and general principles which apply to all the internal and external individuals and entities entertaining direct or indirect relations with ACBC. The sanctions for the non-compliance of this document are presented in the system of sanctions of this Model;
  • Code of Conduct for the Supply Chain – This code defines the minimum requirements and standards that each Supplier shall respect in terms of environmental sustainability, social sustainability and employees’ rights, protection of workplace safety and health, observance of the law and of business ethics. In order to ensure the quality of its products and of the entire production chain, the Company only makes use of materials and suppliers with the following certifications or control reports:
  • BSCI Certification – Business Social Compliance Initiative
    The BSCI is the European social monitoring system for ethical sourcing initiated by the Brussels-based Foreign Trade Association (FTA). BSCI is a business-driven initiative for companies committed to improving working conditions in the global supply chain. BSCI unites hundreds of companies around one common Code of Conduct and supports them in their efforts to build an ethical supply chain by providing them with a step-by-step development- oriented system, applicable to all sectors and all sourcing countries. The 11 principles of the Code of Conduct that BSCI participants commit to implement in their supply chains are: (1) The rights to Freedom of Association and Collective Bargaining; (2) No Discrimination; (3) Fair Remuneration; (4) Decent Working Hours; (5) Occupational Health and Safety; (6) No Child Labour; (7) Protection of Young Workers; (8) No Precarious Employment; (9) No Bonded Labour; (10) Protection of the Environment; (11) Ethical Business Behaviour.
  • Bluesign Certification
    It is an international product and raw material certification aimed at defining principles of environmental and social sustainability, in particular with regard to the efficiency of energy resources; consumer safety; reduction of water consumption; reduction of toxic atmospheric emissions; workplace health and safety;
  • OEKO-TEX Certification
    This certification demonstrates that a product has been tested for harmful substances and that the article therefore is harmless for human health.
  • The Global Recycled Standard (GRS)
    This certification ensures a third party verified environmental statement which proves (1) the content of recycled materials of their products (both intermediate and finished) and (2) compliance with environmental and social criteria in all of the production chain. All products that are composed of at least 20% of pre-consumer and post-consumer recycled materials can be GRS certified.
  • Zero Discharge of Hazardous Chemicals (ZDHC) Certification
    This is a certification of compliance to the ZDHC Program’s Manufacturing Restricted Substances List (MSRL). Compliance certification to ZDHC MRSL Level 1 requires a third-party documentation review (formulation disclosure, MSDS (safety data sheets), chemical inventory, test reports, etc.) to ensure the data meets requirements. If there is a lack of data, a verification testing is performed.

Recipients of the Organization Model of ACBC
The principles and provisions contained in this document apply to:

  • The Members of the Board of Directors
  • The Board of Statutory Auditors
  • The Independent Statutory Auditor
  • Managers
  • Employees
  • Consultants,
  • Other collaborators such as suppliers, agents among others;
  • Those operating under the direction or supervision of the Company’s top management within the scope of their tasks and functions.

Construction of ACBC S.R.L.’s Organization Model

The activities aimed at preparing this Model involved:

  • Identification of the sectors/activities/sensitive areas, with reference to the offences stated in the Decree through the analysis of the most relevant corporate documents (for example: articles of association, chamber of commerce registration, investment contract and shareholders’ agreement, etc.);
  • analytical examination of the sensitive areas, with the identification of the ways and means through which the offences stated in the Decree might be committed by the firm, its administrative bodies, employees and, generally, the persons referred to in art. 5 of the Decree (also via meetings and talks with the persons involved);
  • identification of the internal rules and of the existing protocols – whether or not formalized – with reference only to the areas identified as “at risk of offences”;
  • definition of standards of conduct and supervision namely for the activities which, in accordance with the Company, it was deemed appropriate to regulate;
  • regulation of the ways to manage the appropriate financial resources to prevent the perpetration ACBC – Code of Ethics – 6 of offences;

identification of the person/s in charge of supervising the effective implementation of this Model (hereinafter “Surveillance Body” or “SB”), and setting up of a reporting system by and towards the Surveillance Body;

ACBC S.r.l.’s Surveillance Body

The task of monitoring the functioning and observance of the Model was entrusted by the Company to the Surveillance Body (hereinafter also “SB”), a body with the requirements listed below and aimed at ensuring effective and efficient implementation of the Model.

The Board of Directors attributes an annual budget to the Surveillance Body for the performance of its tasks. However, the Surveillance Body may autonomously use resources exceeding its spending power, in compliance with the corporate procedures, in the event such resources were required by exceptional cases of urgency. In such cases, the Body must inform the Board of Directors immediately.

OUR ETHICAL PRINCIPLES IN THE CONDUCT OF BUSINESS

The ethical principles we all share are to:

    1. Act  with integrity and a sense of responsibility.
    2. Comply with laws and regulations.
    3. Respect the dignity and Human Rights of every individual.
    4. Act with respect for the environment.
    5. Usethecompany’sassetsandresourcesintheinterestsofthegroupanditsshareholders.
    6. Encourage our employees in their community involvement and sustainability initiatives.

Respect business confidentiality.

The Group’s ethical principles of business conduct aim to respect the following key international references:

  • The United Nations Universal Declaration of Human Rights and the European Convention on Human Rights;
  • The OECD Guidelines for Multinational Enterprises;
  • Various International Labor Organization conventions, in particular conventions 29, 105, 138, 182 (child labor and forced labor), 155 (occupational health and safety), 111 (discrimination), 100 (equal remuneration), 87 and 98 (freedom of association, protection of the right to organize and collective bargaining);
  • The United Nations Convention on the Rights of the Child;
  • The 10 Principles of the United Nations Global Compact and associated Sustainable Development Goals (SDG);
  • The UNGP (United Nations Guiding Principles on Business and Human Rights);
  • The United Nations Women’s Empowerment Principles. In addition to the Code of ethics, which is the basis and frame of reference for the ACBC’s ethical business conduct, there are other documents which are associated to it that should be taken into consideration by the company employees and collaborators. It is therefore the responsibility of everyone to enhance their knowledge of the topics affecting them, based on their specific responsibilities, by reading the documents which complement the Code, in particular the Compliance Manual and its associated policies and procedures. Similarly, every year each employee in the Group must take the compulsory training course or courses on ethics developed for all employees of ACBC. Every ACBC employee must be familiar with the Code and its principles, and question themselves before acting, particularly if they have any doubts about their conduct. Employees should be vigilant, ask for help if they do not know how to resolve the ethical dilemma which confronts them, and report any problem or breach of the Code. We undertake to prevent and penalize any breach of the Group’s Code of ethics, and to put in place all the corrective and remedial actions necessary

Our principles of business practice and behavior towards our main stakeholders

 In addition to the references listed above, ACBC considers it important to recall and clarify the principles of practice and behavior shared by all of us and expected of every individual in respect of the different audiences and stakeholders with whom we are in regular or occasional contact. The main principles are stated below.

Responsible leadership

Managers have a key role in respecting our ethical rules and promoting a culture of integrity to help all employees succeed in their duties. They have the specific responsibility of embodying the ethical values and principles of the Company by setting a personal example and ensuring that the Code of ethics is properly applied and respected by their teams. They are guarantors of the dissemination of key messages and good practices. They are at the forefront of listening to and supporting their teams should an ethical question or dilemma arise, encouraging them to express their doubts and questions freely.


Integrity, loyalty and responsibility

ACBC employees have an obligation to act with integrity, loyalty and a sense of responsibility. They will ensure not to get involved in situations that could prove to be fraudulent (corruption, conflicts of interest, misappropriation of assets, communication of fraudulent information etc.) or malicious. In general, their daily actions associated with their professional activities will ensure the respect of the ethical principles of ACBC, safeguard the interests and the image of the Company.

They will give their colleagues and staff respect and fair treatment, and the guarantee of a motivating work environment which respects the dignity and rights of all individuals, fostering development and well-being. The company will promote a human resources policy that contributes to professionalism, motivation, and job satisfaction for all by offering opportunities for training, mobility and internal promotion, and by developing the employability of each individual. ACBC will generate a working environment that respects human rights and labor laws, and complies with laws and regulations on the environment, health, and safety in all the countries in which the company operates. The company strictly forbids child labor and forced labor. We encourage freedom of expression for employees of ACBC. We encourage dialogue and respect the free exercise of unions’ rights within the context of local laws and regulations.

A working environment free from all forms of harassment

ACBC does not tolerate any sort of harassment, discrimination, intimidation, bullying or humiliating behavior, whether psychological, sexual or constituting an abuse of power. It is the responsibility of every individual not to behave in a way that could harm the dignity and rights of others. Harassment means any repetitive voluntary pattern of hostile, abusive or humiliating behavior, whether in the form of verbal comments, actions or gestures which jeopardize the dignity or psychological well-being of a person and which cause a deterioration of the working environment. It may take multiple forms (degrading, offensive or obscene comments, rumor or ridicule, threats, requests to perform demeaning tasks, excluding and isolating people, etc.). Sexual harassment, understood as is intimidation or coercion of a sexual nature and the undesirable or inappropriate promise of reward in exchange for sexual favors, is forbidden. It may include a series of actions ranging from minor transgressions to sexual abuse or sexual assault. Harassment may be subject to disciplinary penalties, and in many countries to criminal proceedings.

At ACBC we believe that diversity is a source of creativity and innovation, and therefore of economic performance. We are careful to develop an inclusive approach in which all differences are taken into consideration, so that everyone is given the opportunity to be themselves. Therefore, the company spreads a culture of equality at all levels of the organization and offer our teams an open and stimulating work environment, free from any discrimination, which contributes to the success of the Company. We promote equality of opportunity and treatment. Within this context, we affirm our commitment to greater diversity and gender parity in all roles and positions, and at all levels in the Company hierarchy.

Well-being at work, work-life balance

To ensure that our employees maintain a good balance between their working lives and personal lives, and to promote the well-being of everyone at work, ACBC seeks to facilitate a supportive working environment which is caring and productive. For this purpose, the Company implements policies and mechanisms to facilitate everyone’s daily life, and improve the quality of life at work: remote working, parental leave, portal solution for best managing the work-life balance, psychological support service, wellness days, etc.


Protection of employee personal data

We have always recognized the value of our employees’ data, and as such, we respect and protect their privacy. To this end, all employees of ACBC benefit from the following rights:

  1. Fair and transparent information before any new processing of data, and prior consent if appropriate.
  2. Right to object to processing of data if there is a legitimate interest.
  3. Right to access and correct data.
  4. Right to data privacy as their data will be visible only by a restricted number of people.
  5. Right to have their personal data deleted after they have left the company.
  6. Reasonable use of social networks and personal websites We encourage staff to be ambassadors of ACBC. However, only the individuals duly authorized to do so within the Company may communicate on its behalf. Talking about the Company is permissible, but not on behalf of ACBC. Every employee represents the professional values of the Company in the public and private sphere, including on social networks and personal websites. We therefore have an obligation to act with integrity and professional discernment when we express our views on subjects that are directly or indirectly connected to the Company, in order to preserve ACBC’s image and reputation. We must ensure that there is no possible confusion between our opinions and personal interests and those of ACBC. For this reason, employees acting under their real identity, or whose identity is associated with their place of work on social networks and discussion forums, must mention that they are acting on their own behalf and that their views do not reflect the image or the stance of ACBC on the topics addressed.
    OUR CUSTOMERS AND CONSUMERS

    Honesty, safety and quality

    We provide our customers and consumers with the very best professional service to ensure that they are satisfied and to earn their trust. Through its Houses, the Group designs and markets products or services that comply with current standards and regulations in terms of quality, safety, industrial and intellectual property rights, and provides transparent, reliable, and fair high-quality information. Our public relations and advertising are based on honesty and fairness, and always keep customer and consumer safety in mind.

    Protection of personal and confidential data

    Our customers retain the power to make decisions about the information that they entrust to us, and we ensure that the confidential nature of their private data is preserved by respecting the commitments we have made to them and in accordance with applicable laws. We respect the right of individuals to retrieve, correct or erase data, and use back-up devices (both physical and digital) for the data collected. The Company recognizes the value of the data that its customers and contacts have entrusted to it. Operating in the Luxury sector, ACBC possesses customer data with a potentially high market value. Being aware of the risk of data breaches, the Company has focused not only on complying with the General Data Protection Regulation, but also ensuring that it provides the best possible protection for its customers’ data.

    Our Business Partners and Our Competitors

    We are committed under all circumstances to fair and equitable business relationships. ACBC publicizes its ethical principles which must guide the conduct of business by its employees, as well as by its business partners, particularly in regard to compliance with laws and regulations, the prevention of any form of corruption, including influence- peddling, and conflicts of interest.

    ACBC strictly prohibits corruption in any form whatsoever, including influence-peddling, and intends to prevent it by complying with the anti-corruption laws applicable in each country in which the Company is present, in particular: French legislation (as amended by the Sapin II law), Italian law, the Foreign Corrupt Practices Act of the USA and the Corruption Act of the United Kingdom. ACBC exercises zero tolerance in regarding all forms of corruption. Active corruption consists of illegally offering or promising an advantage to a person at any time, whether directly or indirectly, which is aimed at inciting that person to act or refrain from acting. The concept of passive corruption refers to the situation of the person corrupted. Corruption is subject to criminal penalties, whether the person corrupted works in the public or private sector. Offering an advantage means offering anything of value (money, of course, but also for example vouchers various kinds of invitation, gifts, donations, job promises, reimbursement of travelling expenses, etc.). As far as “influence-peddling” is concerned, this consists of offers, promises, donations, gifts or advantages of any kind offered directly or indirectly to a person for themselves or for another person, to encourage them to abuse, or because they have abused, their real or assumed influence for the purpose of obtaining distinctions, jobs, contracts or any other favorable decision from a public authority or public administration. We ban facilitation payments throughout the Group, which means the payment of an unofficial sum of money with the aim of facilitating, guaranteeing, or speeding up the execution of an administrative decision. Financing of political organizations, unions, cultural or charitable organizations in the name of or on behalf of the Group for the purpose of obtaining material, commercial or personal advantage, whether direct or indirect, is also totally prohibited.

    Free competition

    Competition law is intended to guarantee that all companies engage in fair competition to offer high- quality products and services at the best prices. We believe in free, open and fair competition, a factor in economic and social progress in terms of prices and the quality and scope of the offer, in the interests of the consumer. We intend to comply strictly with regulations applicable to competition in all markets where the Company operates.

    Commitments by our suppliers and subcontractors

    Respect for human rights and fundamental freedoms are ACBC’s core ethical commitments and must be upheld by all of its employees and stakeholders. To this end, our Code of ethics draws on major international references on ethics and human rights. ACBC is therefore committed to regularly assessing its main suppliers, providing support and advice to them (training programs, development of skills, sharing good practices, among other) to ensure that they comply with its Code of ethics and Suppliers’ Charter.

    ACBC has further set out Sustainability Principles which are systematically communicated to every supplier with which the Group has a contractual relationship; these restate all the fundamental principles and guidelines that complement and specify the major principles of the Suppliers’ Charter.

    ENVIRONMENT

    We endeavor to shape the fashion sector whilst remaining mindful of preserving the planet and its natural resources, and to reduce our impact on climate change and the loss of biodiversity by innovating to support future generations. Measuring our impact beyond our own operations, sustainability is at the heart of ACBC’s strategy: it is a key element in the process of value creation. Our business model aims at having a positive impact on the environment, the economy and the society. In the light of this, ACBC measures the impact of its activities on the protection of natural capital and biodiversity, not only in the areas where it operates directly, but also through its various supply chains, from the production of raw materials to the marketing of the goods and services offered by ACBC to its customers. True to its commitment to transparency and sharing, ACBC publishes the results of its EP&L (Environmental Profit & Loss Account) and makes its methods public, to encourage other organizations to follow its steps in the battle to protect the environment.

    All the Recipients are required to promptly notify the Surveillance Body of ACBC S.R.L. of any derogation, breach or suspected breach, of which they become aware, of the conduct rules referred to in the Company’s Code of Ethics, as well as of the principles of conduct and of the arrangements for the carrying out of the activities defined as “at risk” and governed by the Model.

    The reports, if addressed to the Surveillance Body of ACBC S.R.L., can be submitted by email to:

    organodivigilanza@acbc.com

    The Surveillance Body shall assess all the reports received and adopt the appropriate measures under its discretion and responsibility within its existing powers, it may hear – if necessary – the author of the report and the author of the alleged violation. The reasons of any subsequent decision shall be stated; any measures shall be applied in compliance with the provisions set forth in the Disciplinary System section.

    CODE OF CONDUCT FOR THE SUPPLY CHAIN

    Group Suppliers’ Charter

    Document approved by the Board of Directors of ACBC S.r.l. on 26/02/2019

    Suppliers’ and sub-contractors’ undertakings

    We require our suppliers to adhere to the principles laid down in the Group Suppliers’ Charter. We fight against child labor and forced labor.

    ACBC has introduced checking procedures and does not knowingly work with any partner who disregards these essential principles. ACBC and its brands will help them adopt best practices and comply with its Code of ethics. Beyond these checking procedures, we work to establish lasting partnerships with our suppliers and sub- contractors and support them through training skills and development programs and sharing good practices. Last of all, we believe in free, open and fair competition, a factor in economic and social progress.

    It is equally applicable to the prices, quality and breadth of the offer, in the interests of the consumer and the end customer. We are committed to strict compliance with the relevant regulations relating to competition within the European Union and in all markets where the ACBC operates.

    Group suppliers’ charter

    ACBC and its brands declare their commitment to comply with the provisions of the International Labour Organisation (ILO) and in particular with the conventions concerning the eradication of child labour and the abolition of slavery and forced labour. Moreover, the Group has shown its commitments as a signatory of the United Nations Global Compact and through this support emphasises its defence of the ten principles of the Global Compact since 2008.

    In the light of this, ACBC require their suppliers to commit themselves to the following basic principles which:

    • To prohibit work by children under 15 years of age, saving an ILO waiver clause permitting work by children over 14 years of age;
    • To prohibit the recourse, in whatever form, to slavery, debt bondage, or forced or compulsory labor together with products or services created by these means. The term ‘forced or compulsory labor’ covers all work or service exacted from an individual under threat of any penalty or without remuneration and for which the person has not offered himself/herself voluntarily;
    • To prohibit any type of work which, by its nature or the conditions in which it is carried out, is likely to compromise health, safety or morality;
    • To prohibit any behavior contrary to dignity at work, especially any practice contrary to social regulations and in particular concerning remuneration, working hours and working conditions;
    • To respect employees’ directly applicable right of representation and expression;
    • To prohibit discrimination, in particular racial, ethnic and gender discrimination;
    • To prohibit all forms of sexual and psychological harassment;
    • To ensure the appropriate circulation of the principles of the Charter to its employees;
    • To take appropriate measures for the effective application of the principles of the Charter to its own suppliers;
    • To faithfully warn ACBC and/or its brands of any serious difficulty in applying the Charter.
    • To comply with directly applicable environmental legislation and work to implement the three principles of the Global Compact.

    The unlawful practice of child labor or forced or compulsory labor is totally unacceptable in any commercial relationship between ACBC or its brands and a supplier. In a general way, ACBC shall ensure that any supplier is helped to improve its standards to meet the objectives stipulated in this Charter.

    To determine whether or not the Charter conditions are being properly observed, ACBC representatives and/or its brands, who may be accompanied by outside observers, before any contractual relationship for the supply of goods and services to ACBC, shall have unrestricted access to the administrative documents, personnel and production, and packing and transport sites pertaining to the products and/or services to be contracted. These inspections may be repeated as often as is deemed necessary.

    For any contractor of ACBC or its brands, compliance with the Charter shall constitute, not with standing any contractual clause, an essential condition of the commercial relationship. In the event of significant failure to comply with the Charter, ACBC or its brands shall decide what corrective measures are to be put in place, if need be, in order to permit the commercial relationship to continue.