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ETHICAL CODE

INTRODUCTION

The Versace Group (hereinafter to be called the "Group") is an international business set up in 1978, arising from the genius of its first founder, Gianni Versace, which continues to prosper today as a result of its mythical reputation - a fashion house recognized throughout the world. At present the Group operates in a multiplicity of institutional, economic, political, social and cultural contexts which are in continuous and rapid evolution. All Group activities must be carried out in observance of the law in the context of fair competition with honesty, integrity, propriety and good faith, respecting the legitimate interests of customers, employees, commercial and financial partners and the social context in which the Group's business activities are based. All those working in the Group, without distinction or exception, must be committed to observing, or ensuring the observance, of these principles in the context of their own functions and responsibilities.
The belief that you are acting for the benefit of the Group can never justify the adoption of conduct in conflict with these principles.

For these reasons and given the complexity of the situations in which the Group operates it is important to provide a clear definition of the values it recognises, accepts and shares and the totality of responsibilities taken on by the Group both internally and externally. These are the reasons why this "Ethical Code" or "Code" has been drawn up, setting out a complex of principles and rules. The observance of such rules and principles by those for whom the Code is intended is thus of fundamental importance including for the prevention of the offences described in Legislative Decree no. 231 of 8 June 2000 and to ensure the proper functioning, the reliability and reputation of the Group.

The Ethical Code is a working resource in its own right and represents a reference point for all Group stakeholders. The purpose of the Ethical Code is to ensure the application of propriety, fairness, integrity, honesty and professional discipline to the operations, conduct and manner of working used both in relations internal to the Group and in relations with external parties, ensuring that attention is always focused on compliance with the laws and regulations in the countries in which the Group operates in addition to compliance with the business procedures of the Group itself.

The Board of Directors of Gianni Versace SpA has been guided by the most advanced standards of corporate governance in the adoption of this Ethical Code in order to approve the above-cited principles of ethics and transparency and to reconcile the search for competitiveness with the requirements of a fair competitive environment.

The Versace Group will give high priority to the application of the Ethical Code, ensuring that there are sufficient resources available in terms of information, prevention and control as well as guaranteeing transparency in related operations and conduct and will not hesitate to intervene, where necessary, with corrective actions.

1. GENERAL PRINCIPLES

1.1. Those for whom the Code is intended to apply
"The unchanging touchstone of the Group's business is compliance with the law and regulations in force in all countries where it operates. The persons for whom this Ethical Code is designed will be referred to as the "Addressees". They will be the directors and members of the company bodies of all group companies, all the staff of group companies and all those who, directly or indirectly, whether on a stable or temporary basis, establish relations and relationships with the Group or who in any case, operate to achieve Group objectives in all countries in which the Group operates.

In the first place it will be incumbent on the Managers to give practical application to the values and principles contained in the Ethical Code, accepting responsibility in relations both internal and external to the Group, seeking to reinforce trust, cohesion and team spirit.

Group employees (who are of course already required to comply with the law and regulations in force) will be required to adapt their actions and conduct to the principles, the objectives and the commitments laid down by the Code.

When setting out business goals the members of the various Boards of Directors will be required to ensure that they are consistent with the principles set out in the Code.

All actions, operations and negotiations carried out, and in general, the behavior of group employees in the conduct of working activities, must be inspired by the highest levels of propriety from the point of view of the management, the completeness and transparency of information, legitimacy in both formal and substantive terms and of clarity and truth in accounting records in accordance with the law in force and internal procedures.

Each employee will be required to bring the necessary level of professionalism to the responsibilities assigned to him or her and must act to defend the prestige and image of the Group.

By "Group" is meant Gianni Versace SpA (hereinafter to be called "Versace") and all Versace's directly or indirectly controlled subsidiary companies, "control" in this context having the meaning defined in Article 2359 of the Italian Civil Code.

Each Addressee will be required to know the Ethical Code, to contribute actively in its application and report any deficiency to the competent reference function.

To ensure complete compliance with the Ethical Code, if any employee becomes aware of situations which may actually or potentially represent a significant breach of the Code, he or she must report the same without delay to his or her immediate superior or to one of the reference bodies and send an e-mail message to his or her own company's supervisory body following the directions contained in the procedure ""Communication Management"" of each individual company.

1.2. Versace Group's commitments
The Versace Group will ensure the following, including through the designation of specific functions ("Reference Bodies" referred to under point 1.6 below):

(i) That there is the greatest possible publicity of the Ethical Code among the Addressees;

(ii) That the Code is updated in order to adapt it to changes in social concerns and of the laws of greatest significance for the Code itself;

(iii) That checks are conducted arising from reports on breaches of the Code's provisions;

(iv) That the relevant facts are properly assessed and that adequate punitive measures are applied when breaches are found to have occurred;

(v) That no-one suffers discrimination of any kind for having provided information relating to possible breaches of the Code or the reference law.

1.3. Obligations on all Employees
All employees will be required to know the rules contained in the Code and the reference laws regulating the activities carried out in the context of his or her function. Group employees will be required as follows:

(i) Not to adopt conduct contrary to such rules;

(ii) To report any information, obtained first-hand or from others regarding possible breaches of the rules, as well as any request made to him or her to breach them, to his or her immediate superior or to one of the Reference Bodies without delay.

1.4. Additional obligations of Managers of Business Units and Function
Every manager of a business Unit/Function will be required to act as follows:

(i) To ensure his or her conduct represents an example for his or her staff, providing them with guidance in the observance of the Code and the reference procedures;

(ii) To make sure that staff understand that compliance with the Code and the safety procedures and laws represent an essential part of the quality of their performance of the work;

(iii) To select with care, so far as falling under his or her competence, internal and external staff to ensure that responsibilities are not given to people whose commitment to observance of the Code and procedures cannot be relied on;

(iv) To adopt immediate corrective measures when required by the situation.

1.5. Validity of the Code as against Third parties
All Group employees, within their respective areas of competence, will be required to act as follows in relations with, and as against, third parties:

(i) To provide them with adequate information on the commitments and obligations imposed by the Code;

(ii) To require observance of the obligations directly affecting their activities;

(iii) To adopt the appropriate internal and (when coming within their competence) external initiatives in the case of non-compliance by third parties with the obligation to conform to the Code rules.

1.6. Reference Bodies
The reference bodies for the application of the Code will be the following:

- The Group Ethical Committee, set up in Gianni Versace SpA, will be made up of the Chief Executive Officer, the Chief Financial Officer and the Legal and Corporate Affairs Director. Please refer to the Ethical Committee Regulations annexed to the "Management of Reports" Procedure for a description of the remit of each individual company. The Committee's goal is that of promoting ethical conduct within the Versace Group. The Committee will use the Group Internal Audit function to assess all reports received.

1.7. The Contractual validity of the Code
The Code will constitute an integral part of the employment relationship pursuant to Article 2104 et seq. of the Italian Civil Code.

Observance of the Ethical Code rules will be deemed to be an essential part of the obligations of employees of the Group companies. The breach of Code rules may represent a breach of the primary obligations under the employment relationship and hence a disciplinary offence, with all related consequences under the law including with respect to the retention of employment and may give rise to actions seeking compensation for any loss and damage so caused. For Addressees who are not employees the observance of the Code constitutes the pre-requisite for the continuation of the professional/collaborative relationship with the Group.

If the breach has been committed by a member of a company body of one of the Group companies, this including the Secretary to the Board of Directors of group companies, the Shareholders will be informed accordingly at the next General Meeting or, in the case of the Secretary to the Board, at the first Board meeting, in order to assess the possibility of dismissal from the office concerned for good cause."

2. CONDUCT IN THE MANAGEMENT OF BUSINESS

2.1. Management of Business in general
In its business affairs the Group will base its activities on principles of fairness, propriety, transparency, efficiency, openness to the market, prevention of money laundering and protection of industrial and intellectual property and environment.

Group employees and external collaborators acting in the name, or on behalf, of the Group will be required to observe ethical conduct and comply with the law in business relations of interest to the Group and in relations with the Public Administration, acting with the greatest possible transparency, clarity, propriety and efficiency.

In commercial or promotional relations Addressees will likewise be required to act in a manner consistent with the Group's business policies which may never take the form of acts in breach of the law, regulations in force or business procedures adopted with reference to individual functions even if the ultimate aim is the achievement of the Company Objects.

2.2. Presents, free gifts or other favours
In relations with customers, suppliers and third parties generally, it will not be permitted to offer money, presents or benefits of any kind (such as services, work provision or travel) of a personal nature with a view to obtaining undue advantages (whether real or apparent) of any kind (e.g. the promise of economic advantages, favours, recommendations, the promise of employment …).

Acts of commercial courtesy will in any case be allowed so long as of only small and symbolic value and, in any case, of such a nature as not to compromise integrity and reputation and not to influence the autonomous judgment of the Addressee. In countries where it is a traditional practice to offer gifts to customers or other parties, such conduct will be allowed when such gifts are appropriate in nature and of little or symbolic value. The conduct must always be in compliance with the law and must never be open to interpretation as an attempt to obtain favours.

Any Addressee offered free gifts over and above the normal relations of courtesy and of more than small and symbolic value, will be required to refuse the same and inform either his or her superior or one of the Reference Bodies referred to under point 1.6 above immediately.

Consistently with the above principle, the recipient will not be permitted to give money, favours, gifts or benefits of any kind on a personal basis, whether directly or indirectly, which may tend to obtain undue advantage, whether real or apparent, for the benefit of third parties, save where involving gifts or benefits of little value.

2.3. Conflict of Interest
Addressees must avoid situations and/or activities which may lead to conflicts of interest with those of the Group and which may interfere with their ability to make impartial decisions in the safeguarding of the best interests of the same.

If an Addressee finds him or herself in a situation where his or her interests conflict with those of the Group it will be necessary for the Addressee to inform his or her superior or one of the Reference Bodies immediately and to refrain from the conduct of all activities connected with the situation representing the source of the conflict.

In relations between the Group and third parties Addressees will be required to act in accordance with legal and ethical principles being expressly prohibited from having recourse to illegitimate favouritism, collusion, corruption or the soliciting of personal advantages for him or herself or for others.

Addressees must report any information immediately to their superiors or to one of the Reference Bodies which gives rise to the presumption, or appears to presage a situation, of potential conflict of interest with the Group.

By way of non-exhaustive example, the following situations may give rise to conflicts of interest:

1. The possession of economic or financial interests (the holding of a significant number of shares, professional positions etc.) including through family members, in customers, suppliers or competitors;

2. The carrying out of working activities, including by family members, with customers, suppliers or competitors;

3. The acceptance of money, presents or favours of any kind from people, businesses or bodies which wish to establish business relations with the Group;

4. The use of your own position in the business or the information obtained through your work in such a way as to potentially create conflict between your own interests and those of the business;

5. The acquisition or sale of shares (in Group or external companies) when, in relation to your own work, you have knowledge of important information not yet in the public domain.

6. The use of the name of the Group and/or of Group companies to obtain personal advantages.

Situations cannot be excluded where the existence of relations of family or affection between the manager and a staff member creates the conditions for a potential conflict of interest. In such circumstances, to avoid suspicion that the assessment of the staff member by the manager is not motivated by solely objective and meritocratic criteria, the manager will be required:

• To report a case of "potential conflict of interest" to the Group Ethical Committee,

• To carry out the assessment on the basis of the indications provided by the Group Ethical Committee.

This provision of the Code supplements the policy on conflict of interest already adopted by Versace on 30 May 2005.

Question: I have made friends with a supplier and am considering the possibility of entering a partnership with him in a commercial initiative which has nothing to do with the Versace Group. Would this be in breach of business ethics?
Answer: Yes. Indeed, even if you are able to keep your participation in the new initiative separate from your work as a Group employee, others might consider your work for the Group to be influenced in some way by this second activity, compromising your unbiased judgment. Before going ahead you will need to discuss your plans with the Group Ethical Committee.

Question: I often travel on Group business. Is it possible to collect the points awarded for the flights by the various airlines for use on a personal trip?
Answer: Yes, this would be permitted so long as the benefits received are not in the form of money. What would not be allowed however, would be to try to organise your business flights in such a way as to receive such advantages. Any additional cost chargeable to the Company for such benefits will be treated as a misappropriation of Company funds.

Question: The husband/wife/partner of a member of staff owns a business producing semi-finished products. The business offers high quality products at competitive rates. Could it bid for orders from the Group?
Answer: Yes, so long as it does not take advantage of the professional relations between the husband/wife/partner and staff member.

2.4. Relations with Suppliers
The Group will establish relationships of collaboration with its suppliers in compliance with current law and the Code principles, giving attention to ensuring the best professional standards, the best practice in terms of ethics, health and safety protection and defense of the environment.

In its main contracts Versace requires the Supplier's commitment to observance of the values expressed in this Code. The selection of suppliers and the formulation of purchase conditions for goods and services for Group companies is dictated by competitive values and parameters, objectivity, propriety, impartiality, fairness in the price and quality of the goods/services, having made a careful assessment of assistance guarantees and the overall supply panorama.

Purchasing procedures must be characterised by the search for the maximum competitive advantage for the Group and by fairness and impartiality in relations with the suppliers satisfying the relevant requirements. It will also be necessary to seek the collaboration of suppliers in ensuring continuing satisfaction of Group customer needs in terms of quality and delivery times.

The entry into a contract with a supplier must always be based on relations of the greatest clarity, avoiding where possible, the acceptance of contractual restrictions leading to dependency on the contracting supplier.

2.5. Relations with Customers
Versace will pursue its sales goals on national and international markets through the offer of fashion, luxury and high quality products at competitive conditions and in compliance with laws designed to protect competition.

In the context of relations with customers and compliance with internal procedures, Addressees must seek to achieve the greatest possible customer satisfaction providing, among other things, complete and accurate information on the Versace products provided to them in order to allow the customer to make an informed choice but also to create conditions for retaining their loyalty.

Staff may not offer benefits, fees or incentives to customers in breach of either the law or of group commercial policies.

2.6. Correct use of Company property
All Addressees will be responsible for the protection of the resources entrusted to them and will have the duty to inform the relevant bodies immediately of any threats to, or events which might damage, the Group. In particular, each Addressee will be required to act as follows:

• To act with diligence in the protection of business property through the adoption of responsible conduct in line with the operational procedures laid down for the regulation of the use of such property;

• To avoid misusing business property which might cause damage or the reduction of efficiency or use which is in any case in conflict with business interests;

• To obtain the required authorisations should it be necessary to use the property outside the business context.

The growing dependence on IT means that it will be necessary to ensure the availability, security, confidentiality and greatest possible efficiency of this particular property category.

Each Addressee will be required to act as follows:

• To follow business security rules to the letter in order to avoid compromising the functionality and protection of the IT systems;

• To avoid loading loaned or unauthorised software onto business systems and never to effect unauthorised copies of licensed programmes for personal, business or third party use.

The use of the above assets (even when involuntary) for any purpose outside business activities may cause serious loss and damage (of an economic, image, competitive etc. nature) to Versace. The situation may be worsened by the fact that improper use may lead to the imposition of criminal and administrative sanctions on Versace for any unlawful acts and the need to undertake disciplinary action against the Addressees involved.

When expense documentation is presented, reasonable, actual and authorised expenses will be refunded according to the rules contained in the specific procedures drawn up for the purpose. It will always be necessary to ask for a receipt and ensure that personal expenses are always kept separate from work expenses.

Question: Is it permissible to take home photographs of Versace models to allow a spouse/partner or other person to choose what they want to buy?
Answer: Photographs cannot be taken home. The person concerned should visit one of the shops to look at the catalogue and choose the products to buy. Otherwise they could look at the products online.

2.7. Information Management
Each Addressee will be required to know and to implement business policies concerned with information security to guarantee its integrity, confidentiality and availability. Addressees will be required to process their own documentation using clear, objective and complete forms of expression making it possible for them to be consulted by colleagues, managers or external parties authorised to request the same.

By way of example, all information relating to the following will be deemed to be confidential: prototypes, drawings, drafts, trademarks and research concerned with products under development; commercial, managerial, industrial and strategic plans; financial operations, investments or disinvestments, employee personal data, lists of customers and collaborators and all else forming part of the Group's industrial, commercial and managerial know-how.

Any information or material obtained or produced by an Addressee in the performance of, or in relation to, his or her work will be the exclusive property of the Group company with which the Addressee has an employment relationship.

The Group will ensure the confidentiality of the information in its possession and will not use confidential information save in cases of express and informed authorisation and in any case, always ensuring such use is in the strictest observance of the legislation in force concerned with protection of personal data.

In the communication of confidential information to third parties, only permitted for official or professional reasons, the confidential character of the information requested and the requirement on the third party to itself observe the duties of confidentiality must be expressly stated.

Confidentiality will also be guaranteed through the use of adequate measures of business data protection where such data are stored on electronic media. 2.8. Management of Money or Property
Addressees will not be permitted to replace or transfer money, property or other utility deriving from a crime or carry out any operation with a view to hindering the identification of the criminal origin of the same.

The Group must always comply with the application of the anti-money-laundering laws in force in the places where companies belonging to the Group operate and it undertakes to check the reliability and propriety of its business partners.

2.9. Protection of Industrial and Intellectual Property
In the implementation of the principle of observance of the law, the Group undertakes to comply with domestic, Community and international regulations for the protection of industrial and intellectual property.

Those for whom this provision is intended will be required to promote the proper use of trademarks, distinctive markings and all work of a creative nature for any purpose and in any form, including computer programs and databases, ensuring the protection of the moral and economic rights of the author.

In this regard any conduct effected in general, involving counterfeiting, alteration, duplication, reproduction or dissemination of the work of others in any form without the related rights will be forbidden.

3. EXTERNAL RELATIONS

3.1. Relations with Political Parties, Trade Unions and Associations
The Group will not make contributions to political parties, whether directly or indirectly, whether in Italy or abroad, this including such parties' representatives or candidates.

Each employee must recognise that any form of involvement in political activities must be carried out on a personal basis, during his or her free time, at his or her own expense and in compliance with the laws in force and may NOT be carried out in his or her capacity as a Group employee. It is forbidden to use databases, business information, archives or anything belonging to Group companies to carry out activities in the form of political propaganda. Finally Group funds may not be given to political parties or individual politicians.

Furthermore, the Group will not make contributions to organisations with which there might be a conflict of interest (such as trade unions or consumer or environmental protection associations). Forms of co-operation will nonetheless be possible in the following circumstances: the aim is consistent with the Group's mission or is referable to projects of public interest, the use of the resources is clear and documented and express authorisation has been given by the responsible business functions.

The Group will have transparent relations with all political forces in order to be able to represent its own position on subjects and themes of interest.

The presentation of specific positions by the Group to political forces and/or associations must be effected with the consent of the responsible management or functions.

3.2. Relations with Public Institutions
Relations with public bodies or organisations necessary for the development of the Group's programmes, will be reserved exclusively to the business functions with delegated powers in this area.

Relations must be characterised by the greatest possible transparency, clarity and propriety and must be of such a nature as to avoid partial, false, ambiguous or misleading interpretations by the public institutions with which the different kinds of relations are established.

Any acts of commercial courtesy or hospitality to representatives such as public officials or persons holding office in a public service will be permitted when of small value and in any case of such a nature that it would not be possible for a third party to interpret them as aimed at acquiring advantage in an improper way. In any case this type of expense must be authorised and adequately documented.

The employment of ex-employees of the Public Administration who managed relations with the Group in the exercise of their functions or the employment of their family members or relatives must be conducted in the strict application of the standards laid down by the business in the selection of staff.

The agreement of other forms of working relationships with ex-employees of the Public Administration, their family members or relatives, must also be effected with the strict application of business procedures.

In the production of company documentation it will be prohibited to set out versions of the facts which are untrue and which are capable of misleading or improperly influencing the Public Administration's powers of analysis.

Group employees will also be required to provide the widest collaboration with the Public Administration in the event of possible inspection activities. In such circumstances the Group's staff will be required to provide clear, transparent and truthful information promptly.

3.3. Subsidies and Financing
Contributions, subsidies or financing obtained from the European Union, the state, from other countries where the Group has a presence or other public body, even if of only moderate value and/or amount, must be used for the purposes for which they were requested and granted.

3.4. Relations with the Mass Media
Relations between the Group and the mass media are the responsibility of the specifically designated business functions and must be carried out consistently with defined policy and communication tools. When participating in conferences, congresses and seminars, drafting articles, papers and publications generally as also when involved in public events, information relating to the Group's activities, results, positions and strategies may be disclosed, if not already in the public domain, following notification to and authorisation from the staff member's direct supervisor, the Communications Director and the Managing Director.

Question: If invited as a speaker to conferences dealing with fashion, would it be possible to use examples of Versace's business?
Answer: Yes, this is allowed but a formal request must be made to the Managing Director for authorisation ensuring agreement on provision of the materials you wish to use.

4. STAFF QUALIFICATIONS

4.1. Human Resource Management
Human resources are an indispensible element for the existence and development of the business. The dedication and professionalism of employees are values and conditions of determining importance for the achievement of the Group's objectives.

The Group will protect personal values. In this context, no conduct of a discriminatory nature will be tolerated nor will any form of personal or sexual harassment, molestation or offensive behaviour be permitted. Versace thus guarantees that there will be no room in the work-place for any form of discrimination based on age, sex, sexual orientation, race, language, nationality, political or trade union opinions, religious beliefs or other personal characteristics not relating to work.

The Group undertakes to develop the skills and capacities of each employee so that the energy and creativity of each individual is able to find full expression in the performance and achievement of the Company Objects. The Group will offer its entire staff the same opportunities of professional growth, ensuring that all are able to enjoy fair treatment based on merit without any form of discrimination. The competent functions will thus be required:

(i) To adopt criteria based on merit, skill and in any case strict professionalism when making any decision in relation to an employee;

(ii) To select, employ, train, pay and manage employees without any form of discrimination and in compliance with all applicable employment law provisions;

(iii) To create a work environment where personal characteristics cannot give rise to discrimination.

Each Addressee will be required to collaborate actively in the maintenance of reciprocal respect for the dignity and reputation of all.

The Group will thus seek to eliminate all discriminatory conduct or behaviour damaging to the person, his or her beliefs and preferences (for example in the case of insults, threats, isolation or excessive interference or limitation of professional opportunities). Any breach of this article must be communicated immediately to the Group Ethical Committee or to Reference Bodies described under point 6.

4.2. Foreign workers and child labors
Into the Group employee are hired with regular employment contracts and is not tolerate any form of illegal labor. It is forbidden to hire foreign workers without a residence permit and/or take out term contracts with deadline over duration of residence permit. The Group doesn't employ any form of forced labor, compulsory or child labor, doesn't employ people younger than the age laid down for starting work by the legislation of the place in which the work is performed. The Group is also committed to not establishing or maintaining working relationships with suppliers that employ child labor.

4.3. Sexual harassment
Versace will not tolerate sexual harassment, this to be understood as the following: the subordination of pay or money prospects to the acceptance of sexual favours, proposals of private inter-personal relationships continued notwithstanding express statements that not welcome or when this is in any case reasonably evident and when, given the specific circumstances of the case, it is capable of causing discomfort to the person receiving such requests.

4.4. Care in Dressing and Maintaining Image
Group employees will be required to dress to a professional standard whenever their working activities are conducted with customers, suppliers and/or the public. In any case, even when not required to interact with third parties, staff will be required to wear clothing which is not characterised by the explicit exhibition of brands other than those of the Group.

4.5. Environment, Safety and Health at Work
The Group undertakes to promote and consolidate a culture of safety, heightening awareness of risk, promoting responsible behaviour by all workers and seeking to protect worker health and safety, particularly through the adoption of accident prevention measures. To such end the Group undertakes to develop training (and information) programmes tailored to the needs of the particular Addressees.

Furthermore, the Group undertakes to guarantee working conditions are such as to ensure the protection of workers' psycho-physical health, maintaining its works premises, offices and operational systems in such a way as to comply with all safety standards and to guarantee working conditions which observe individual dignity together with the establishment of a safe and healthy working environment. Finally, the Group will carry out periodical inspections to ensure that all safety measures are effectively implemented and observed. All workers in their turn will be required to comply with the conditions imposed by the law and the Group practices and procedures.

4.6. System of Sanctions
Sanctions applicable to those in management positions

The conduct of any member of the management team which is contrary to the principles set out in this Ethical Code and/or which is fraudulent or negligent, or contrary to the law or fundamental duties of the position held, will be assessed taking account of the special nature of the related employment relationship and its highly fiduciary nature, of the lack of a system of low-level disciplinary sanctions, of the Group's special need to be able to trust in the professionalism, availability and skills of the person concerned for the implementation of the principles described above and compliance with the principles of legality and the business's rules and procedures.

Sanctions applicable for employed workers
The sanctions which may be applied to staff are those set out in the collective contracts which each employee declares that he or she accepts at the moment of appointment. The breach of the provisions of the Ethical Code may constitute breach of the primary obligations of the employment relationship and a breach of disciplinary rules. In such circumstances the business will be entitled to adopt all appropriate action including the termination of the employment relationship and a claim for compensation for any loss and damage. Cases of responsibility for failure to carry out checks and controls by persons vested with the related function will be treated with particular severity.

5. ENVIRONMENTAL PROTECTION

5.1 Environmental protection into work processes
Environmental protection is to be fostered in the overall approach to business. The Group is committed to improve continuously the environmental performance of the quality systems, production processes through the monitoring of the legislative and regulatory provisions.

5.2 Environmental impact and product safety
The Group is committed to producing and selling, in compliance with legislative and regulatory requirements, products with the highest standards in terms of environmental performance and safety. Also it works to develop and implement innovative technical solutions to minimize environmental impacts and ensure the highest safety.

6. TRANSPARENCY OF ACCOUNTING RECORDS AND INTERNAL CONTROLS

6.1. Accounting Information
Accounting transparency is based on the truth, accuracy, completeness and reliability of the documentation of managerial events and the related accounting records.

Each Addressee will be required to collaborate to ensure that management facts and events are recorded correctly and in good time in the accounting system.

Each operation/activity must be lawful, authorised, consistent, documented, verifiable and conform with the principles of traceability and business procedures in accordance with criteria of prudence in the defence of Versace's interests.
· Business procedures must allow the conduct of checks on operations, authorisation processes and on the performance of such operations.

· Every member of staff who carries out operations whose subject matter is money, property or other utility with an economic value belonging to the Company, must provide the appropriate evidence to permit the checking of such operation.

Adequate supporting documentation for the activities carried out must be archived in the Company papers for each operation in order to facilitate its recording in the accounts, the identification of the different levels of responsibility and the accurate reconstruction of the operation itself.

Each record must reflect exactly what appears in the supporting documentation.

Any Addressees discovering omissions, falsifications, alterations or negligence in supporting information and documentation will be required to report this to their superiors or to the Group Ethical Committee.

6.2. Internal Controls
The Group wishes to promote a culture in all levels of the organisation which is aware of the importance of an adequate internal control system.

In particular Versace considers that the Internal Control System must assist in the achievement of company goals and must therefore be directed towards the improvement of the effectiveness and efficiency of the production and managerial processes.

All Addressees, within the ambit of their functions, will be responsible for the correct functioning of the Control System.

Everyone must consider him or herself the custodian of, and responsible for, all tangible and intangible company assets which are instrumental for the activities carried out.

The Group Internal Audit and the auditing companies appointed by the Group will have free access to the data, documentation and information of use in the conduct of their activities.

7. ADOPTION, AMENDMENTS AND EFFECTIVENESS

This Ethical Code was adopted by Resolution of the Board of Directors of Gianni Versace S.p.A. on 25 March 2013.

Every update, amendment or revision of this Ethical Code must be approved by the Board of Directors of Gianni Versace S.p.A.

The Versace Group will carry out periodic checks of compliance with this Code. Any reports of potential breaches will be investigated by the business and, and, on advice from the Group Ethical Committee, will be reported to the Boards of Directors of the Group companies concerned and to the competent authorities. Any accusations which are intentionally false or instrumental in nature will be dealt with through the disciplinary system. Every staff member will be required to co-operate fully in any kind of investigation, whether internal or external, maintaining the confidentiality of the same and of the related documentation.

The disciplinary action taken in response to breaches of this code may also involve the manager of the person committing the breach to the extent to which it is established that the latter has taken part in the breach or is guilty of negligence in ensuring compliance with the Code. Staff in breach of this Code, those with the duty to supervise the work of the staff under them who have failed to do so and any member of staff or of the administrative or control bodies who impedes staff from communicating the doubts or uncertainties held in good faith in relation to conduct not complying with the Code or are guilty of extortion or threats in that regard, will be subject to the application of all consequential measures in accordance with the procedures laid down by the rules, the National Collective Employment Contracts and the applicable regulations. Any alteration or destruction of documents with the aim of impeding an imminent or potential investigation is strictly prohibited.