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Following a shocking Swiss Television report on the unacceptable conditions associated with the procurement of exotic animal leathers, the Executive Management of the Swatch Group has adopted the following measures: The Swatch Group FEPS (Far Eastern Procurement Service) Division will immediately attempt to determine if leather from the Far East is used and, should this prove to be the case, will undertake on-site inspections of all sources. Products from such doubtful sources as those described by Swiss Television have no place in the Swatch Group product offering. With its FEPS, Swatch Group has for many years maintained an efficient control group whose responsibility is to examine and monitor all suppliers to the Group (of packaging, accessories and equipment of all kinds, etc.) at regular intervals to ensure they are in conformance with Swatch Group requirements. The criteria to be enforced include, among others, the exclusion of child labor, acceptable social and environmental conditions at the relevant supplier companies, and, with immediate effect, acceptable handling and sourcing of animals by suppliers of leather and their local sources �C irrespective of the fact that exotic leathers comprise only a very small proportion of the leathers used by the Group and that nearly one hundred percent of the latter is sourced from controlled animal breeders in the United States.

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