CODE OF BUSINESS CONDUCT AND ETHICS
OUR COMMITMENT TO ETHICAL CONDUCT
Stewart Enterprises, Inc. is committed to maintaining high ethical standards
that are essential to our continued success. Our policy, as expressed in this
Code of Business Conduct and Ethics, is to operate our businesses with integrity
and to comply with all laws applicable to our business. Our Company is owned by
its stockholders. They expect and require all directors, officers and employees,
by virtue of their association or employment with the Company, to adhere to the
highest standards of integrity and to comply with all laws. We expect compliance
with this Code by each director, officer and employee of the Company.
This Code explains the basic principles of business conduct and ethics for our
Company. No code or policy can anticipate every situation a director, officer or
employee might confront. Accordingly, this Code is intended to serve as a source
of guiding principles for directors, officers and employees, who are expected to
apply them to their day-to-day activities and seek advice whenever they are
unsure about a particular situation.
The purpose of this Code is to enhance the awareness of all personnel of our
commitment to integrity, to deter any wrongdoing and to promote the following
objectives, which are key to the success of our Company:
o Honest and ethical conduct, including the ethical handling of
actual or apparent conflicts of interest between personal and
professional relationships.
o Avoidance of conflicts of interest, including disclosure to an
appropriate person or persons identified in the Code, of any
material transaction or relationship that reasonably could be
expected to give rise to such a conflict.
o Full, fair, accurate, timely and understandable disclosure in
reports and documents that we file with or submit to the SEC
and other public communications made by the Company.
o Compliance with applicable governmental laws, rules and
regulations.
o The prompt internal reporting to an appropriate person or
persons identified in the Code of violations of the Code.
o Accountability for adherence to the Code.
EMPLOYEE RESPONSIBILITIES: INTERPRETATION, COMPLIANCE AND REPORTING
Employees should address questions concerning the application of laws, this Code
or any other Company policy, and should report violations of any law, this Code
or any other Company policy, as set forth below:
o First, an employee should direct questions or report
violations to his or her supervisor or manager.
o If an employee believes his or her questions or concerns have
not been addressed satisfactorily by the supervisor or
manager, or if an employee is uncomfortable discussing
questions or concerns with or reporting violations to the
supervisor or manager, the matter should be addressed with the
next level of management, a senior manager, the Division
President, a Human Resources representative or by calling the
Employee Hotline at 1-800-401-2119. You do not have to
identify yourself when calling the Employee Hotline, but you
should provide enough information so that a reasonable inquiry
can be conducted. All calls to the Employee Hotline will be
handled on a confidential basis.
o Calls to the Employee Hotline regarding accounting, internal
accounting controls or auditing matters will be handled by
senior members of the Company's Internal Audit Department. If
you are uncomfortable with this arrangement and would rather
register a complaint directly with the Audit Committee of the
Board of Directors regarding accounting, internal accounting
controls or auditing matters, or if you wish to deliver an
anonymous submission of concerns regarding questionable
accounting or auditing matters, you can call counsel to the
Audit Committee, Mr. L. R. McMillan, II (504-582-8188), who
has been instructed by the Audit Committee to maintain the
confidentiality of anyone who calls him.
Each employee must be alert and sensitive to situations that could result in
illegal, unethical or otherwise improper actions, either by him or herself or
other employees. Also, employees should be aware that failure to comply with the
provisions outlined in this Code may result in disciplinary action, up to and
including termination of employment, and in the case of an illegal act, referral
for criminal prosecution. No violation of this Code, any other Company policy,
or any law will be justified by a claim that it was ordered by someone in higher
authority. No one, regardless of his or her position, is authorized to direct an
employee to commit an illegal act.
If any employee observes or becomes aware of a possible violation of this Code,
any other Company policy, or any law, the employee is obligated to report the
matter as directed above. Reporting a known or suspected violation should not be
considered an act of disloyalty, but an action that shows a sense of
responsibility that will help safeguard the reputation of the Company and its
employees. Failure to report a known
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violation may result in disciplinary action, up to and including termination of
employment.
Should it be discovered that an employee has been arrested for suspected
criminal conduct, either on or off the job, the Company may conduct an
independent review of the available facts and determine whether disciplinary or
employment action is warranted.
DIRECTOR AND OFFICER RESPONSIBILITIES: INTERPRETATION, COMPLIANCE AND REPORTING
The Company's directors and officers are expected to comply with this Code,
other applicable Company policies, and all laws. They are also expected to
promote ethical behavior by (1) encouraging employees to talk to supervisors,
managers and other appropriate personnel when in doubt about the best course of
action in a particular situation; (2) encouraging employees to report violations
of laws, this Code, or any other Company policy to appropriate personnel; and
(3) reminding employees that the Company will not permit retaliation for reports
made in good faith.
Company directors and officers who become aware of violations of law, this Code
or any other Company policy are expected to stop the violations and, if
necessary, conduct an investigation with assistance of Company counsel if
appropriate.
A failure of any director or officer to comply with any law, this Code, or any
other applicable Company policy may result in disciplinary action, removal or
dismissal, and, if warranted, legal proceedings.
PROTECTION FOR PERSONS REPORTING QUESTIONABLE BEHAVIOR
All directors, officers and employees are required to cooperate fully in any
internal investigation. If an employee discovers the need to report a suspected
violation of law, this Code, or any Company policy, that employee will not be
disciplined for (1) making a report of a violation or suspected violation in
good faith and on the basis of a reasonable belief that a violation has occurred
or will occur or (2) assisting with any ensuing investigation. To the extent
permissible, the Company will endeavor to keep confidential the identity of
anyone reporting possible violations.
CONFLICTS OF INTEREST
Actual and Apparent Conflicts of Interest
This Code requires directors, officers and employees to avoid any situation that
would create a conflict between their own interests and the interests of the
Company. Personal interest that causes a conflict may extend to a family member,
friend, or other associate of a director, officer or employee, rather than
directly to those persons. All persons subject to this Code should avoid
situations that would reasonably appear to adversely affect the independence and
objectivity of their judgment, or interfere with the timely and effective
performance of their duties and responsibilities. Director, officer and employee
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actions should be based primarily upon what is in the best interests of the
Company, rather than upon personal considerations or relationships.
It is not possible to describe every conflict of interest. Some of the more
common conflict circumstances are set forth below. Questions about possible
conflicts of interest should be discussed as set forth in this Code.
o Gifts, entertainment and payments - The undisclosed acceptance of
gifts, entertainment, money or anything else of value from outsiders,
which may influence the performance of duties, should be avoided at
all times. Notwithstanding the foregoing, employees may accept without
disclosure nominal gifts (valued at less than $250), which are gifts
of token value or gifts used for advertising or promotion, as long as
they are customarily given in the regular course of business. In
addition, employees may accept ordinary business entertainment without
disclosure if it is reasonable in the context of the business and it
is either associated with a necessary business meeting or it advances
the Company's business interests. In all cases, the acceptance of
gifts valued at $250 or greater or the acceptance of extraordinary
business entertainment must be disclosed to and approved by:
<Table>
<Caption>
Recipient Required Approval
-------------------------------------- -------------------------------------
Company Employee ..................... Regional COO, Division CFO, Corporate
Vice President, or Division President
Regional COO or Division CFO ......... Division President
Senior Sales Executive ............... Division President
Corporate Vice President ............. Company Chief Financial Officer
Division President ................... Company Chief Operating Officer
Chief Financial Officer or Company
Chief Operating Officer .............. Chief Executive Officer
Chief Executive Officer .............. Chairman of the Audit Committee
</Table>
Under no circumstances (except for tipping, as described below) is the
acceptance of money from third parties permitted. This includes cash
equivalents such as checks, money orders, securities or other items
that may be readily converted to cash. An employee who is offered
money should report the offer immediately to his or her supervisor.
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In regard to tipping, no employee may solicit or accept any gratuity,
tip or money of any amount. Generally, when offered an unsolicited
tip, employees should politely decline by saying, "I'm here to serve
your family, and appreciate your offer, but nothing additional is
required." If and only if the prevailing cultural norms provide for
tipping of employees and it would be insulting to refuse such tips,
then these tips may be accepted on behalf of the entire firm, with the
knowledge of local management. Such tips should be combined and used
for the benefit of all the location's staff, not individual employees.
o Preferential treatment in providing services - It is a conflict of
interest to favor the interests of certain customers, suppliers or
fellow employees over those of similarly situated individuals or
companies. Of course, extra effort to provide superior service for all
customers is encouraged, as long as those efforts fall within standard
Company procedures. Examples of conflicts involving preferential
treatment include handling business transactions of family members,
being personally involved in a business deal or providing special
treatment because of a personal relationship. We expect all
transactions with Company stakeholders to be at "arms length" and to
have no appearance of undue favoritism or impropriety.
o Purchase and sale of Company assets - Employees may purchase equipment
or vehicles from the Company only with the prior written consent of
the Company's Chief Operating Officer or Chief Financial Officer.
Avoidance of Conflicts of Interest: Disclosure of Material Transactions or
Relationships that Could be Expected to Give Rise to Conflicts of Interest
Each director, officer and employee is responsible for recognizing situations in
which a conflict of interest is present or might arise and for taking
appropriate action to eliminate or prevent such conflict, including disclosing
any material transaction or relationship that reasonably could be expected to
give rise to such conflict, to their immediate supervisor, a senior manager, a
Division President, a Human Resources representative or, in the case of
directors and officers, to the Audit Committee of the Board of Directors.
In some instances conflict of interest situations may be permitted if disclosed
to and approved in writing by, (1) in the case of an employee, a Regional Chief
Operating Officer, a Senior Sales Executive or a Corporate Vice President or (2)
in the case of a director or officer, the Audit Committee of the Board of
Directors.
CUSTOMER RELATIONS
An employee should never knowingly misrepresent any product or service of the
Company. Employees should always exhibit the highest possible ethical and
professional standards when dealing with our customers.
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PROPERTY RIGHTS OF OTHERS
Copyright infringement - Copyright laws prohibit the unauthorized duplication of
computer software and other published works. Copyrighted materials should not be
reproduced for personal or Company use without verifying that duplication is
permissible. Unauthorized copying of computer software, video, written,
photographic or audio material subject to copyright protection could result in
claims of copyright infringement. Utmost care should be taken to avoid the
unauthorized reproduction of any copyrighted materials.
Intellectual property - In the conduct of business, the Company has occasion to
receive and use proprietary information of others. This information can be used
only in accordance with the agreements under which it has been received.
Employees should not engage in unauthorized copying, revealing or using the
intellectual property of a former employer or a competitor in connection with
employment, including competitor information such as customer lists or
operational data.
INVOLVEMENT IN POLITICS, OUTSIDE ACTIVITIES AND THE COMMUNITY
Political activities - The Company may choose to make contributions to political
candidates or political parties if permitted by applicable laws. Employees may
not make any contribution on behalf of the Company or use the Company's name,
funds, property or services for support of political parties or candidates
unless the contribution is permitted by law and specifically authorized in
writing by the Company. Employees are encouraged to participate in the political
process by voting and otherwise being involved in political activity. However,
employees engaging in political activity will do so as private citizens and not
as representatives of the Company. An employee's personal political
affiliations, involvement or contributions will not influence the employee's
compensation, job security or opportunities for advancement. Under no
circumstances will any employee be reimbursed by the Company for personal
political contributions.
Outside activities - Employees are expected to give their work the attention
necessary for quality performance. Any outside business interest, including
other employment, is not permitted if it is in direct competition with Company
business, interferes with the timely and effective performance of job duties,
creates a conflict of interest or prevents devotion of full time (or, in the
case of part-time employees, their full part-time commitment) and energy to the
job when at work. Employees may not solicit other employees or distribute
literature of any sort during work time or in work areas.
Community activities - Employees are encouraged to be involved in volunteer
activities and organizations that improve or help their communities according to
the following criteria:
o The involvement must be undertaken in accordance with applicable laws;
o The involvement must not interfere with an employee's ability to do
his or her job with the Company;
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o The involvement must be such that the employee does not appear to
represent or make decisions on behalf of the Company; and
o The involvement must not create a conflict of interest or other
problem related to employment.
USE AND PROTECTION OF COMPANY ASSETS
Protection of Company property is vital to our business. It is the
responsibility of every employee to protect these assets from loss, damage,
misuse or theft.
Company property includes tangible assets such as buildings, equipment,
vehicles, customer contracts and payments, and office supplies, as well as
intangible assets such as software and other intellectual property rights,
business concepts and strategies, employee time, financial data and other
information about the Company.
Directors, officers and employees are prohibited from taking for themselves
business or corporate opportunities that are discovered through the use of
Company property or information or through the individual's position, provided,
however, if the Company's disinterested directors or an appropriate committee of
the Board of Directors determines in writing that the Company will not pursue an
opportunity that relates to the Company's business, a director, officer or
employee may do so.
The Company considers all data and communications transmitted or received by or
contained in the Company's electronic or telephonic equipment and systems or
maintained in written form to be Company property. Employees and other users of
the equipment or systems should have no expectation of privacy with respect to
those data and communications.
Company property should be used for the benefit of the Company and not for
personal gain.
COMPANY RECORDS AND FINANCIAL STATEMENTS - ACCURACY, ACCOUNTING, ACCOUNTING
PRACTICES
The integrity of the Company's financial reporting is of the utmost importance.
All transactions must be accurately reflected in the Company's books and records
in accordance with generally accepted accounting principles and in compliance
with all laws and Company policies regarding the maintenance of accounts and
records. All financial data should be prepared promptly, carefully, and honestly
and treated with discretion.
Management will establish and maintain internal standards and a system of
internal accounting controls designed to provide that transactions are recorded
accurately and honestly.
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Falsifying or altering records or reports or knowingly approving false or
altered records or reports is prohibited.
Records should always be retained or destroyed according to the Company's
records retention procedures.
FULL, FAIR, ACCURATE, TIMELY AND UNDERSTANDABLE DISCLOSURE IN (1) REPORTS AND
DOCUMENTS THAT THE COMPANY FILES WITH, OR SUBMITS TO, THE SECURITIES AND
EXCHANGE COMMISSION AND (2) OTHER PUBLIC COMMUNICATIONS MADE BY THE COMPANY
Filings Submitted to the Securities and Exchange Commission
The Company's Disclosure Committee has adopted a set of written Disclosure
Controls and Procedures designed to enhance the accuracy and completeness of the
Company's SEC filings. All officers and employees involved with the preparation
of the Company's SEC filings are expected to comply fully with the Company's
Disclosure Controls and Procedures.
Other Public Communications
No director, officer or employee shall make statements or provide any
information to the press, financial analysts, or any public forum about the
Company and its business prospects unless they have specific authorization to do
so. The potential legal risks from inaccurate statements include claims of false
advertising, misrepresentation, breach of contract, securities fraud or
antitrust violations.
In order to ensure that communications to the public about the Company are
accurate and widely disseminated to all investors, directors, unauthorized
officers and employees may not communicate any material nonpublic information
about the Company outside of the Company. Only the Company's President and Chief
Executive Officer, Chief Financial Officer and Vice President of Investor
Relations, or employees specifically authorized by them, are authorized to speak
with financial analysts or securities professionals. If an employee or director
receives an inquiry from a journalist or financial analyst, he or she should
refer it to the Investor Relations Department or the Corporate Communications
Department, as appropriate.
CONFIDENTIALITY
It is a conflict of interest for a director, officer or employee, during or
subsequent to association or employment with the Company and without proper
authority, to give or make available to anyone, or use for his or her own
benefit, information of a confidential nature derived from association or
employment with the Company. Directors, officers and employees may not use their
positions with the Company for outside gain or benefit, nor may they use
confidential information in any outside activity or employment.
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Directors, officers and employees of the Company are expected not to divulge
confidential information about the Company's business or customers and are
expected to use confidential information only in the performance of their
duties.
Examples of confidential information include, but are not limited to, financial
earnings results before they are released to the public, pending negotiations
regarding financing or the acquisition or sale of businesses, and
attorney-client communications. For more information, refer to the Company
policy on Trading of Company Securities and Handling of Non-Public Information.
INSIDER INFORMATION
Many directors, officers and employees may learn of or have access to
proprietary information about the Company that is not generally known to the
public and if disclosed could affect the market value of Company stock or that
of other companies. This information could include trade secrets, business
plans, marketing and sales programs, audits, dividend policy, earnings or other
confidential or proprietary information that could financially affect the
Company. This is known as "insider information" and must be held in the
strictest confidence.
Disclosing "insider information" is a violation of federal law. Any director,
officer or employee participating in such activities may be subject to civil or
criminal penalties. For more information, refer to the Company policy on Trading
of Company Securities and Handling of Non-Public Information.
NONDISCRIMINATION
The Company strives to maintain an environment free of discrimination on the
basis of race, color, religion, sex (including sexual harassment), national
origin, age, disability, veteran status or any other unlawful discrimination.
If an employee believes he or she has been discriminated against or sexually
harassed, the procedures outlined in the Company's Workplace Harassment Policy
should be followed to report discrimination or harassment.
SAFETY, HEALTH AND THE ENVIRONMENT
The Company is committed to providing a safe and healthy workplace for its
employees and for visitors to all facilities. All employees are expected to
actively participate in this effort and immediately report any suspected unsafe
or unhealthy conditions in the workplace to a manager, safety director or a
Human Resources representative.
The Company's policy on Safety and Health is available in the HR Policy Guide.
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ANTITRUST LAWS
Antitrust laws have been developed to encourage healthy competition among
businesses by defining what conduct or activities are unacceptable and unlawful.
The Company must compete solely on the merits of its products and services and
must not engage in any form of unfair competition. Agreements between
competitors that unfairly limit competition are a violation of antitrust laws.
Oral discussions and informal arrangements may be considered "agreements," so
employees should be extremely careful when meeting with competitors, including
contacts at trade associations and professional gatherings. When engaged in
conversation with competitors, employees must not discuss or listen to a
discussion of present or future prices, profit margins or costs, bids or
intended bids, terms or conditions of sale, market share, sales territories,
distribution practices or other competitive information.
INTERNATIONAL BUSINESS
Employees are expected to obey the laws and respect the customs of countries in
which the Company operates and transacts business. If the laws do not address a
particular situation or are unclear or conflicting, consult a Regional Chief
Operating Officer or Division President for guidance.
GENERAL CONDUCT
Employee conduct should always reflect favorably on the Company. This includes
respecting the personal and property rights of others, acting in a courteous and
considerate manner with others, representing the Company in the community in a
positive and law-abiding manner and complying with the Company's policies and
procedures such as:
o Taking responsibility for work attendance and performance;
o Exhibiting courtesy, honesty, integrity and trustworthiness in conduct
with other employees and visitors;
o Treating others with dignity and respect;
o Helping to keep our workplace safe and desirable;
o Not engaging in or tolerating any form of harassment or
discrimination; and
o Following the Company's Standards of Conduct and Work Rules.
COMPLIANCE
Each director, officer and employee is required to comply with the Code of
Business Conduct and Ethics. Directors, officers and employees have the
following responsibilities with regard to the Code's administration:
o Every supervisor or manager is required to administer and enforce the
Code within his or her area of responsibility by:
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o Ensuring that each employee reads and reviews a copy of the Code;
o Ensuring that employees are aware that they may make a good faith
report of a violation or suspected violation of the law or the Code
without fear of reprisals;
o Ensuring that any standards and procedures developed for their areas
of responsibility comply with the Code; and
o Reporting any possible violations of the Code, or situations that
could result in Code violations or be perceived as Code violations.
o All directors and key officers are required to certify compliance with the
Code on an annual basis. Those officers required to certify compliance
annually include Regional Chief Operating Officers, Division Chief
Financial Officers, Division Presidents, Corporate Vice Presidents, the
Chief Financial Officer, the Chief Operating Officer, and the Chief
Executive Officer.
o All directors, officers and employees (including supervisors and managers)
are responsible for:
o Reviewing and familiarizing themselves with the Code;
o Keeping a copy of the Code or having access to it for personal
reference;
o Complying with the policies set forth in the Code;
o Seeking advice and information when uncertain whether particular
activities are in compliance with the Code; and
o Reporting violations of the Code using appropriate channels described
in the Code.
REVIEW AND CHANGE OF POLICY
The Human Resources Department has administrative responsibility for monitoring
compliance with the Code on the employee level. The Audit Committee of the
Company's Board of Directors is responsible for monitoring compliance with the
code on the director and officer level. The Internal Audit Department is
responsible for conducting a periodic review of the Code and for recommending
necessary changes. The Audit Committee of the Company's Board of Directors must
approve any changes to the Code.
Any waiver of any requirement of this Code for senior officers or directors may
be made only by the Audit Committee of the Company's Board of Directors and all
such waivers of or changes in Code provisions must be promptly disclosed to
shareholders in accordance with the rules of the Securities and Exchange
Commission and the trading markets on which the Company's securities are traded.
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