Code of Ethics

The first Code of Ethics was developed in 1992. The Code has been continuously updated since to take into account new internal and external developments. The third version, issued in 2001, was the first document to define our goals, vision and values on an integrated basis.

Our approach

Our work force is the base of the company. MOL Group is committed to consistently operating in accordance with lawful behaviour and fundamental ethical norms. Our employees contribute to MOL’s success not only through their expertise and performance, but also by creating a positive public opinion about the company.

The Code of Ethics is a compendium of norms and rules that every employee must follow when at work. We expect every individual and every organisation in contractual relationship with the Group and its member companies, as well as partners acting on the Group’s behalf, to comply with the Code. This includes the Board of Directors, and all subsidiaries and entities of which MOL Group, directly or indirectly, owns or controls more than fifty percent (50%) of voting or ownership interests, as well as the Company’s executives and employees. The Code should also be adhered to by the Company’s agents and representatives, including consultants. The Code also applies to all MOL Group companies’ contractors and vendors. We not only expect compliance to specific expectations and requirements as set out in the Code of Ethics, but we also vigilantly monitor and control adherence to them.

In 2006, in line with integrated business operations, the three separate ethics bodies that were operating in MOL Group (MOL Plc., TVK Plc. and Slovnaft a.s.) were transformed into a single body, the MOL Group Ethics Council. The first Group-level Code of Ethics, valid for all member companies and subsidiaries, was prepared concurrently, and was launched in 2007. Whilst preparing the Code, we took international best practice and standards into account to better reflect stakeholder expectations and to strengthen our practices and compliance.

Besides controlling and supervising investigations launched into breaches of ethics, the Ethics Council evaluates ethical risks related to our operations, and ensures that these regulations mitigate and reduce such risks.

The Code of Ethics completes the regulation pyramid together with the three main governing documents (OOR - Operational & Organisational Rules, DTR - Description of Tasks and Responsibilities, LDA – List of Decision-making Authorities) and MOL Group Guidelines. These three establish the structure of the organisation and set its basic operational framework - the CoE contributes to this structure by providing fundamental behavioural standards to be respected by Group employees.

Ethics

In 2009, within the framework of ethics management we focused on communication, education and on the development of our ethical monitoring system, as summarised below.

• To strengthen internal communication, 7 articles were published in our internal company magazine (“Panorama”). The articles contained an ethical evaluation and interviews with executives on current ethical issues, such as the ethical dimension of the economic crisis, financial frauds, and the ethical aspects of retail business
• Ethical education was launched in all subsidiaries where our Code of Ethics was implemented in 2009. Ethical lectures were attended by 100% of employees
• All operators and employees of Hungarian filling stations participated at a special training session on ethics
• The pilot of the integration of ethical training into competency development training events was launched and positive feedback was received
• Code of Ethics e-learning material has been made available on the Company Intranet and testing of the material has been successfully finalised. For the first phase, initial participants on the e-learning program will be those employees of MOL Plc. who have PC access
• Ethical expectations and KPIs were defined for all Country Chairmen. This evaluation system allows us to further improve our ethical framework

Ethical issues

The following section details only those ethical cases which the Ethics Council dealt with. The Council’s role is to ensure that every MOL Group employee complies with the Code, thus among other tasks it answers questions and oversees internal investigative processes. In 2009 a total of 11 questions were raised about a wide range of topics, including conflicts of interest, communication between colleagues and sexual harassment.
In 2009 the Ethics Council received altogether 8 notifications. Based on them, two ethical investigations were conducted by the Ethics Council and in 4 cases the Corporate Security department was asked to perform an investigation. As a result of the 6 investigations, ethical misconduct was proven in 4 cases. Although anti-discrimination is a priority issue for us, there were no notifications in this area.

The table below summarises ethical notifications received, broken down by stakeholder group (similarly to how ethical issues are categorised in the Code):

Steakholders	Topic of notification	Type of investigation	Ethical misconduct
Customers	Invoicing obligation	n.a.	n.a.
Shareholders	Fraud (anonymous)	Security Investigation	No
	Misapropriation	Security Investigation	No
	Intrenet usage	Security Investigation	Yes
	Internet usage	Security Investigation	Yes
Employees	Harassment	Ethical Investigation	Yes
	Employment Contract (anonymous)	n.a.	n.a.
Helath, safety and environment	-	-	-
Governmental relations, political activity	-	-	-
Local communityiesand society	-	-	-
Suppliers, business partners	Conflict of interest	Ethical Investigation	Yes
Competitors	-	-	-
Total	8	6	4

The Ethics Council reported all ethical issues to the Executive Board and proposed measures in cases of ethical misconduct. In one case the work contract with the employee concerned was terminated, while in two cases bonus incentives were withdrawn, and in one case - in order to raise awareness about a specific ethical norm - the Ethics Council issued a statement, which was communicated internally.