PARAGON HEALTH MODERN SLAVERY STATEMENT

AUGUST 2021

Paragon is committed to ensuring that there is no modern slavery or human trafficking in our supply chains or in any part of our business. Our Modern Slavery Policy reflects our commitment to acting ethically and with integrity in all our business relationships and to implementing and enforcing effective systems and controls to ensure slavery and human trafficking is not taking place anywhere in our supply chains.

Policies and Training

Paragon’s employees, contract workers and suppliers are obliged to comply with Paragon’s Code of Conduct, which incorporates standards prohibiting modern slavery, human trafficking, labour rights violations and unethical business practices. This is commonly referred to as QELMS (Quality, Ethics, Labour rights, Modern slavery & Safety) within Paragon.

​Paragon provides training to all our employees, contract workers and management team who are part of the day-to-day management of our supply chain. We pay particular attention to reducing risks associated with all our suppliers’ products and our suppliers are required to commit to adhering to our modern slavery policies. Training is provided to staff upon joining our company and when there are updates to our company policies.

In the event that suppliers are identified to pose a higher risk in the area of Modern Slavery, or other aspects of QELMS, Paragon commits to investigating this supplier further to ensure the safeguards and policies are in place to prevent modern slavery occurrences from happening. Training will be provided to these suppliers on our modern slavery polices, what our key performance indicators are and how they must meet these performance indicators and maintain this performance.

If, after investigation, an issue in the area of Modern Slavery, or other aspects of QELMS, is found to be substantiated, Paragon Health will inform the relevant authorities and actively work to protect the victims involved.

Our management team is commitment to ensuring the appropriate level of coordinated action is taken throughout our business and supply chain. Therefore, all company policies are made available to all our workers as well as workers within our supply chains.

Awareness

With years of experience in this industry, Paragon are cognisant of the appalling conditions under which firms operate in order to fulfil demand. Many glove companies in particular, have been found to employ unethical and illegal employment practices in their manufacturing operations. In fact, the British Medical Associated stated in a 2016 report that the foreign glove manufacturing market “should be considered a high risk industry for labour rights abuse”[i]

These practices go against the very ethos of our organisation and as such, we regularly assess our own business supply chain to ensure that those areas at highest risk of modern slavery continue to operate in an ethical and morally responsible manner.

Risks in our supply chain

As a manufacturer based in the UK, our direct risk of modern slavery is very low. We operate a world-class factory, with highly skilled and well paid staff. Our direct suppliers too have a low risk of modern slavery (and other issues related to QELMS) due to our diligent and thorough supplier review program.

We do understand however, that risks of modern slavery, however low, do exist. In our supply chain, we have identified that our supply chain for paper packaging is a slightly elevated risk area of our business when compared to other materials we purchase. However, our overall risk of modern slavery or QELMS issues in our supply chain remains extremely low.

Identifying & Managing Risk

With regard to paper packaging, we deem this to be slightly higher risk due to the nature of the recycled material we purchase. Our supplier is a converter of card and paper and they print and process recycled material in the UK. They source from within the UK but as we go further back in their supply chain, a percentage of the raw material which is collected in order to be recycled, is imported from Eastern Europe, Turkey and Greece. The fact that a component of the recycled material is imported from higher risk regions, leads us to the conclusion that there is an elevated risk of modern slavery with this aspect of our supply chain.

We manage this risk by asking our supplier to conduct a review with their entire supply chain similar to that which we employ to review our suppliers. This included, but is not limited to asking the supplier to provide evidence of;

• the percentage of raw material that is sourced from these regions,

• certification and documents regarding the importation of such material,

• the companies which are involved in the supply of the raw material from these regions

• engagement with these companies to establish their policies and procedures to reduce the risk of modern slavery and other QELMS issues.

Due Diligence

Paragon carries out a risk assessment on each supplier we work with. When selecting suppliers, we consider environmental, social value and governance factors, company culture and business practice as well their approach to reducing the risk of modern slavery in their supply chain.

We review our process and policies on an annual basis at a minimum, or immediately upon identifying an incident or breach of our Policies, and assess the performance of our suppliers in our supply chain. When working with suppliers we ask that they demonstrate the following:

• Proactive steps are taken to protect their workers’ rights and provide a safe and fair working environment.

• Communication channels are in place that allow employees to safely and anonymously report incidents of modern slavery violations without any form of penalty.

• Migrant workers’ rights are protected and proactive steps are taken to ensure they can communicate effectively with management and report grievances.

• Suppliers have a modern slavery policy in place and take proactive steps to regularly review this policy and provide training to staff.

• Suppliers conduct multi-tier risk assessments and assess their partners and suppliers supporting their business operations.

• We commit to monitoring our Policies on a monthly basis at a minimum, or immediately upon identifying an incident or breach of our Policies.

Annual risk assessments are carried out and our risk register updated. We identify in our risk assessment those areas that are more prone to modern slavery and other aspects of Quality, Ethics, Labour rights, Modern slavery, and Safety protocols and carry out the necessary due diligence to ensure the increased risk is properly investigated and safe guards are in place.

Accountability

With the full support and endorsement of the Paragon Management team, all employees are required to adhere to Paragon’s code of conduct as a condition of their employment. This includes all company policies and procedures, in particular our modern slavery policy. Any employee or member of our management team who violate these policies are subject to appropriate disciplinary action. Training in modern slavery – including how to identify possible breaches of our policy, either in our own business or in our supply chain, form a part of the induction process for every employee, and an understanding of the same must be demonstrated prior to commencement of that staff members work. We also train our suppliers to ensure that they fully understand the same.

All Paragon employees and suppliers are required to report violations a of our Modern Slavery policy to our management team immediately. We guarantee safe and anonymous communication and actively encourage our employees to report such incidents. Our management team will thoroughly investigate report violations and all employees and suppliers are required to cooperate in such investigations. In the event that corrective action is required, Paragon Health will clearly communicate to the relevant parties the steps to be taken.

Measurement

Paragon is focused on continual improvement. To that end, we commit to the measurement and attainment of Key Performance Indicators (KPIs) in the area of modern slavery, as referenced in our Modern Slavery Policy.

We then use the findings from our KPIs to guide our management team’s policies on modern slavery, which is then communicated to our staff and suppliers, as well as regular training provided.

Child Labour

Paragon will not engage in or support the use of child labour. If Paragon engages any young workers for e.g. work placement through an education authority, we will ensure that this is legally permissible in the UK and that a suitable risk assessment is carried out to ensure that young persons are not working in hazardous conditions or work more than 8 hours per day. Children will not be employed for work and no children will be procured for illegal activities. In the event that a contractor or supplier violates our company policies on child labour Paragon will provide assistance in the removal and rehabilitation of an exploited child as a matter of urgency and of the greatest importance.

Governance

Paragon’s position on modern slavery is outlined in this statement and our Modern Slavery Policy. This statement is made pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes Paragon’s slavery and human trafficking statement for the financial year ending 31st December 2021. This updated version was approved by the board on on 24th August 2021.

Approved by: Martin Tierney

[i] Santhakumar, A. and Bhutta, M., 2016. [online] Bma.org.uk. Available at: <https://www.bma.org.uk/media/1093/in-good-hands-medical-gloves-report-web-23-03-2.pdf> [Accessed 26 August 2021].

PARAGON MODERN SLAVERY POLICY

AUGUST 2021

Modern slavery is a heinous crime and a morally reprehensible act that deprives a person's liberty and dignity for another person's gain. It is a real problem for millions of people around the world, including many in developed countries, who are being kept and exploited in various forms of slavery. Every company is at risk of being involved in this crime through its own operations and its supply chain.

We are aware that there are reports of modern slavery, human rights abuses and unethical employment practices in PPE manufacturers, and in particular, glove manufacturers in various countries across the world.

Evidence of such practices have led British Medical Association to state that glove manufacturing “should be considered a high-risk industry for labour rights abuse”1. In addition, the American Customs and Border Protection banned the import of medical gloves from the world’s top producer in light of evidence of unethical and illegal working conditions. 1,2

QELMS At Paragon

The family values of Paragon, and our commitment to local manufacturing ensure that we treat our staff, and those in our supply chain, with dignity and respect. We have developed guidelines in the area of Quality, Ethics, Labour rights, Modern slavery & Safety (“QELMS”) to guide our work in this area.

Paragon has a zero-tolerance approach to modern slavery. Through UK-based manufacturing and our QELMS program, we can ensure that this risk is close to zero for Paragon Health’s customers, suppliers, and our community.

We have brought the manufacture of nitrile gloves and medical masks back to the UK, where production takes place in a modern factory to a world-class standard to ensure that our customers’ risk of modern slavery in their supply chain is close to zero when purchasing our products.

We are fully committed to preventing slavery and human trafficking in our operation and supply chain. We have taken concrete steps to tackle modern slavery and other forms of unethical business practices, as outlined in our statement. This statement sets out the actions that we have taken to understand all potential modern slavery risks related to our business, and to implement steps to prevent slavery and human trafficking during the current and subsequent financial years.

• As an organisation, we commit to:

• Adherence to local and national laws

• Freedom of workers to terminate employment

• Freedom of movement

• Freedom of association

• Prohibition of any threat of violence, harassment, and intimidation

• Prohibition of the use of worker-paid recruitment fees

• Prohibition of compulsory overtime

• Prohibition of child labour

• Prohibition of discrimination

• Prohibition of confiscation of workers original identification documents

• Provision of access to remedy, compensation, and justice for victims of modern slavery

In summary, Paragon recruits directly and makes no charges on our employees for any benefits associated with employment. Any required uniform or protective equipment is provided. To avoid debt bondage accrued privately, our UK employees have access to the NHS for healthcare, are provided with fair pay, and as an organisation, we offer flexibility of working hours to accommodate childcare provisions.

Our business and supply chains

We establish a relationship of trust and integrity with all our suppliers, which is built upon mutually beneficial factors. Our supplier selection and on-boarding procedure includes due diligence of the supplier's reputation, respect for the law, compliance with health, safety, employment and environmental standards, and references from their other customers. We insist on a rigorous audit of our suppliers from a QELMS perspective before we do business with them.

We have not found evidence of, nor have we been made aware of any allegations of human trafficking, slavery or unethical employment activities against any of our suppliers to date. If any issue were to arise, we would then act immediately against the supplier and report it to the authorities.

Procurement

​Paragon is committed to fair and ethical procurement practices throughout the procurement process. This is outlined further in our Sustainable Procurement Policy and Sustainable Procurement Plan, available for staff to view and read on our company network.

We do not offer incentives for accelerated delivery times, nor do we give penalties for not meeting deadlines and we do not demand delivery of orders outside of what is deemed ‘reasonable’ delivery projections between Paragon and our supplier.

Any procurement issued by Paragon will have, at least, an equal weighting of quality and pricing to ensure that our suppliers do not jeopardise the health, safety, and well-being of their staff in order to win business with our company. We will contractually agree with our suppliers with regard to any technical specification, penalty clauses and payment terms.

We do not adopt aggressive pricing, and always take into consideration the business needs of our suppliers, in particular with regard to production costs. We discuss terms with our suppliers and agree lead times that are fair and reasonable.

As an experienced organisation, we practice forecasting and advance planning to ensure a consistent workload. We discuss stock requirements with our suppliers to accommodate increases in demand or late orders. Our suppliers are never asked to meet demands that have not been agreed to prior to a contract, and we adopt a collaborative approach to working with our suppliers.

Accurate technical specifications are always provided to our suppliers, and Paragon commit to fair contractual terms around contract termination and contract changes that may affect a supplier’s ability to fulfil a contract. Payment terms are agreed prior to the contract commencing, and Paragon Health commit to paying on time so as not to adversely impact our suppliers business.

Evidence of our suppliers’ ethical supply chain will be a condition of Paragon Health awarding a contract to the supplier, and Paragon Health also actively disqualify abnormally low tenders.

In addition, we score, monitor and report ourselves and our suppliers in reference to how we are;

• Complying with the letter and spirit of all applicable legislation.

• Monitoring our performance, and that of our Supply Chain from a sustainability and QELMS (Quality, Ethics, Labour rights, Modern slavery & Safety) perspective and reporting on it on at least an annual basis.

• Working with our supply chain to improve their performance from a sustainability and QELMS perspective by identifying issues, providing training, monitoring improvements and progress towards goals.

• Holding ourselves and our suppliers to account. Our commitment to ethical manufacturing means that each of our staff members are empowered to report instances of non-compliance. This must include reporting of suppliers to relevant authorities and ceasing trading with said supplier if a violation of our policies, or relevant legislation, occurs.

Risk assessment

At a minimum, on annual basis, we conduct a risk assessment of our supply chain by taking into account:

• The risk profile of individual countries where the supplier is located, based on the Global Slavery Index

• The business services rendered by the supplier

• The presence of vulnerable demographic groups

• A news analysis and the insights of labour and human rights groups

• The geography, ownership structure and staff and employee structure within the company

• This assessment determines our response and the risk controls that we implement.

Policies

Paragon operates the following policies for identifying and preventing slavery and human trafficking in our operations:

Whistleblowing Policy - we encourage all employees – whether they be employed by Paragon, our customers, or our suppliers - to report to Paragon Health any suspicion of slavery or human trafficking without fear of retaliation. We provide an open door policy where we commit to the privacy of discussions should a member of staff wish to protect their identity.

Code of Conduct - our code encourages employees to do the right thing by clearly stating the actions and behaviour expected of them when representing the business. We strive to maintain the highest standards of employee conduct and ethical behaviour in the management of our internal affairs and the management of our supply chain.

Supplier Contracts - we have updated our supplier contracts to make explicit reference to slavery and human trafficking.

Supplier due diligence

Paragon conducts due diligence on all new suppliers during on boarding and on existing suppliers at regular intervals. This includes:

• Assessing risks in the provision of particular services

• Auditing the suppliers, their health & safety standards, labour relations & employee contracts & requiring improvements to substandard employment practices

• Sanctioning suppliers that fail to improve their performance in line with our requirements

We require all suppliers to attest that:

• They don't use any form of forced, compulsory or slave labour

• Their employees work voluntarily and are entitled to leave work

• They provide each employee with an employment contract that contains a reasonable notice period for terminating their employment

• They don't require employees to post a deposit/bond and don't withhold their salaries for any reasons

• They don't require employees to surrender their passports or work permits as a condition of employment

• They treat their staff with the dignity and respect that a person deserves, and in line with the labour and employment philosophy of Paragon Health.

• Paragon also employs the use of ‘responsible sourcing’ to inform supplier approval decisions and guide our desk-based research on the same.

Supplier due diligence – 3 Step Evaluation Method in line with QELMS

Paragon carries out a 3-step process in order to perform supplier due diligence in the area of QELMS (Quality, Ethics, Labour rights, Modern slavery & Safety). Each of these pieces of research build upon each other to evaluate the supplier. Each step is deemed a Pass/Fail exercise and companies who do not meet our high standard of Modern Slavery prevention and the other aspects of QELMS, will not progress to subsequent steps and will ultimately not become a supplier to Paragon.

Step 1 - Desk-based research. This step includes but is not limited to the following activities.

• Analysis of the suppliers’ Company accounts to determine their financial health.

• Cross referencing their physical addresses, phone numbers, web address and email addresses with multiple sources (such as industry publications, public and governmental databases, Google Streetview) to ensure the company is legitimate and its claims are supported by reality.

• A review of media coverage relating to the company, local job listings and salaries and reviews on employee forums, such as Glassdoor.

• Research into their suppliers and other customers.

• Collating & evaluating evidence of the supplier’s approach to sustainability from an environmental, supply chain resilience and ethical perspective.

• Researching if the Supplier engages in indirect methods of recruitment, worker-paid recruitment fees as a form of debt bondage or charge employees for services such as accommodation or healthcare, all of which can facilitate occurrences of modern slavery.

• Asking the Supplier to complete our supplier QELMS questionnaire and a sustainability assessment.

• If a company Passes this step, we will move to Step 2.

Step 2 - References

• We seek references from a minimum of 3 customers from each supplier.

• These references are cross-checked against the information found in Step 1.

• This again is a Pass/Fail exercise. If a company Passes this step, we will move to Step 3.

Step 3 – Site Visit.

It is Paragon’s policy to visit suppliers’ manufacturing premises (or primary place of business if not a manufacturer) in order to.

• QELMS Audit – A thorough audit of the supplier from a Quality, Ethics, Labour rights, Modern slavery, and Safety perspective.

• Speak with staff about their workplace and their treatment by the company.

• Evaluate the facilities available to staff such as bathrooms, kitchen, break areas.

• Experience the working conditions for staff and the subsequent quality environment in which the product is manufactured.

Since January 2021, Paragon Health’s procurement team have conducted in-person site visits with suppliers in the following countries;

• 4no visits in Ireland

• 6no visits in the UK

• 2no visits to Poland

• 3no visits to Italy

• 3no visits to Germany

• 5no visits to the USA

• 2no visits to Brazil

• 1no visit to Switzerland

• 1no visit to Spain

• 4no visits to Canada

Due to Covid restrictions, we were unable to visit suppliers in Japan, Malaysia, Australia & Singapore. Instead, we substituted an in-person visit with;

Multiple real-time walk-around video tours with the staff inside the companies, and,

An in-person visit by a trusted third party in order to conduct the audit on behalf of Paragon Health.

The Site Visit is again a Pass/Fail stage for the supplier, and only after successful completion of these 3 steps would a supplier be contracted to supply Paragon Health.

Child Labour

Paragon will not engage in or support the use of child labour. If Paragon engages any young workers for e.g., work placement through an education authority, we will ensure that this is legally permissible in the UK and that a suitable risk assessment is carried out to ensure that young persons are not working in hazardous conditions or work more than 8 hours per day. Children will not be employed for work and no children will be procured for illegal activities. In the event that a contractor or supplier violates our company policies on child labour, Paragon will provide assistance in the removal and rehabilitation of an exploited child as a matter of urgency and of the greatest importance.

Awareness

Paragon has raised awareness of modern slavery issues by talking about this issue in our daily meetings and on-boarding sessions, and by increasing the awareness of modern slavery with all our staff, which includes.

• Explaining our commitment in the fight against modern slavery

• Red flags for potential cases of slavery or human trafficking

• How employees should report suspicions of modern slavery

Training

In addition to the awareness programme, Paragon has rolled out QELMS training via our Morning Meetings to all employees, which covers:

• Various forms of modern slavery in which people can be held and exploited

• The size of the problem and the risk to our organisation

• How employees can identify the signs of slavery and human trafficking, including unrealistically low prices

• How employees should respond if they suspect slavery or human trafficking

• How suppliers can escalate potential slavery or human trafficking issues to the relevant people within their own organisation

• What external help is available for the victims of slavery

• What terms and guidance should be provided to suppliers in relation to slavery policies and controls & what steps Paragon will take if a supplier fails to implement anti-slavery policies or controls

• An attestation from employees that they will abide by Paragon’s anti-slavery policy

• Information provided by Anti-Slavery International, of which Paragon is an active supporter.

Measuring how we're performing

Paragon has defined a set of key performance indicators (KPIs) and controls to combat modern slavery and human trafficking in our organisation and supply chain. Our team records and actively works towards the accomplishment of the following KPIs:

• Employee’s completion of mandatory QELMS training.

• Goal: 100% of new staff to complete during induction with refresher training annually, at a minimum.

• Working only with suppliers who have passed our 3 Step Evaluation Method

• Goal: 100% of suppliers to complete prior to commencement of trading with Paragon. Reviewed annually, at a minimum.

• Working with suppliers to roll out an awareness and training programme in line with Paragon’s modern slavery policies, and the other aspects of our QELMS measurements.

Goal: One supplier per quarter to work with Paragon in presenting training to their staff.

Workshops with our employees to demonstrate their awareness of and sensitivity to QELMS issues in our workplace and that of our supply chain.

Goal: Conduct at least one such workshop per year with both procurement teams (with an external focus) and internal staff, with an internal focus.

Conduct an internal review with a cross-functional Human Rights team on how we are addressing modern slavery and human trafficking.

Goal: Create a team and conduct an annual review of our activities in the area of QELMS.

Additionally, in line with the NHS KPIs, we look at areas such as:

Supplier engagement:

100% of our suppliers to have agreed to the supplier code of conduct.

100% of new suppliers have undergone a sustainability and QELMS assessment during the on boarding process.

We deliver an internal awareness campaign annually as part of training refreshment to all employees regarding modern slavery including how to spot the signs and how to report issues.

Modern Slavery Training:

Paragon ensures that 100% of all new employees are trained in the topic of modern slavery and their responsibilities under the same as part of their induction.

We ensure that all our staff working in roles dealing with suppliers, such as the Procurement Team receive ongoing updates and notifications regarding our QELMS (Quality, Ethics, Labour rights, Modern slavery & Quality) processes, with a specific focus on modern slavery.

We commit to monitor and review our Policies on a monthly basis at a minimum, or immediately upon identifying an incident or breach of our

Policies.

This statement covers the financial year ending 31st December 2021. The current version of this statement has been approved by the board of Paragon at the board meeting on 24th August 2021.

Approved by: Martin Tierney

Signed:

Santhakumar, A. and Bhutta, M., 2016. [online] Bma.org.uk. Available at: <https://www.bma.org.uk/media/1093/in-good-hands-medical-gloves-report-web-23-03-2.pdf> [Accessed 26 August 2021].

U.S. Customs and Border Protection. (2019, October 1). CBP issues detention orders against companies suspected of using forced labor. https://www.cbp.gov/newsroom/national-media-release/cbp-issues-detention-orders-against-companies-suspected-using-forced?_ga=2.240848067.138172710.1611338430-703527877.1611338430

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