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The Code of Ethics and Core Values

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The Code of Ethics and Core Values

Contents

A word from the CEO, Chairman of the Board & Chairman of Workers' Union 3

Vision of the Israel Electric Corporation 4

Introduction 6

IEC’s Five Core Values 7

Courageously Changing 8

Committed to our Customers’ Needs 8

Leading Responsibly & Authentically 8

We Care 10

Committed to Professionalism and Excellence 11

Code of Ethics in Practice 12

Appendix: Ethics Rules in the Digital Arena 14

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Dear Employees,

At Israel Electric corporation we are committed not only to achieving results but also to the way in which we

conduct ourselves. Out of a firm belief in the importance of our actions and the way we behave, we have

recently formulated the company’s Core Values through a thorough, corporate-wide process that included a

large number of employees and managers. These values are the cornerstone of the Ethics Code presented

here.

Assimilation of these values is intended to reinforce an organizational culture that will assist the company in

coping with its business environment and with the changes in the electricity sector, in the path to fulfilling

IEC’s vision: “To lead the energy market in Israel as an efficient and fair business company, which is the

backbone of the economy, in a world of advanced technologies, accelerated development and competition”.

We ask you to peruse this document, familiarize yourselves with and understand the principles, rules and

values set forth in the Code, in order that they may become a tool and compass in your daily work and an

integral part of our organizational culture.

We expect each and every one of our directors, executives and employees to meet these highest of ethical

standards, uncompromisingly adhere to personal and business codes of conduct based on responsibility and

integrity, and most importantly – identify with these values. A special responsibility is placed on the executive

level, from whom we expect to set a personal example in applying and assimilating these rules. Thus, we shall

ensure that relationships with our colleagues and customers, suppliers, the public, the authorities and other

company stakeholders are based on trust.

Transparency and sharing, reliability and responsibility, professionalism and excellence, commitment to

customer needs are all more than just slogans. These are the values that should guide us in all we do. An

uncompromising adherence to the Code’s values will increase our sense of pride as IEC employees and

managers, help us to keep the company a pleasant work place, and secure our moral, economic and social

strength.

Sincerely,

Mr. Ofer Bloch Maj. Gen. (Res.) Yiftah Ron Tal Mr. Miko Tzarfati

CEO Chairman of the Board Chairman of the Workers' Union

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Vision of the Israel Electric Corporation

Since its foundation in 1923, the Israel Electric Corporation has fulfilled a central role in the development of

Israel's society and economy. Its founder, Pinchas Rotenberg, stated the following principle back in 1927:

“The one and only concern of the Israeli Electric Company is the development of the country on the basis of

pure business considerations”.

IEC is a major provider of essential service in the economy, its mission being to provide electricity to millions

of customers. It thus contributes to the quality of every resident's life, sets the economy's wheels in motion,

and is essential to the activity of every organization and household in the country, both in routine and in

emergency situations.

We strive to continue being the leading business company in the energy market in Israel. To this end, we

aspire to be Israel’s leading electricity provider, an efficient and advanced electricity producer, and one of

the world’s leading and most advanced grid infrastructure companies. We strive to act efficiently,

professionally and fairly in an evolving competitive environment and ever-changing advanced

technologies, with the aim of ensuring the company adequate profitability and financial strength, which

are required for the supply of available and high quality electricity to the economy, and for continued

development of the electricity sector.

We shall courageously change, in order to develop and adapt the company to changing structure and market

conditions and to economic, social and technological changes in Israel and across the world, including in the

fields of renewable energy, energy efficiency, energy storage, electric vehicles and smart grids, and aspire to

operate in new and international markets.

To this end, we will develop and deliver products and services that best meet our customers' needs. We will

provide excellent service, ensure top quality and safety, strive for excellence in management, technological

innovation, creativity and efficiency, and do all these while maintaining the highest environmental standards

and promoting corporate sustainability.

We are committed to:

Providing the best response to our customers' needs, and providing innovative, high quality and

available service at an efficiency level tailored to market conditions.

Leading the market, meeting its needs and staying ahead of competitors in the nature and quality of

services and products we provide.

Acting with respect, integrity, fairness and credibility towards customers, employees, competitors,

suppliers, lenders, shareholders and government agencies.

Recognizing our employees as a core asset of the company, communicating with them respectfully

and openly, supporting their advancement, creating a sense of pride and belonging, and encouraging

them to work with mutual trust and in collaboration, with passion, commitment and creativity.

Israel Electric corporation (IEC) leads the energy market in Israel as an efficient and

fair business company, which is the backbone of the economy, in a world of

advanced technologies, accelerated development and competition

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Demonstrating leadership and taking responsibility for our decisions, actions and outcomes, both

within and outside the company.

Serving as an example of excellence in management, operation, technological innovation, governance

and due diligence, while promoting and fostering proper organizational norms and values, and zero

tolerance for any deviation from them.

Protecting the environment with determination, while producing cleaner energy and striving for

sustainable development.

Being attentive to the human environment in which we operate, collaborating with the community

and exhibiting engagement, caring and social responsibility.

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Introduction

The Code of Ethics reflects IEC's compass of values. It incorporates the principles that guide us in our activities.

Strict adherence to these principles increases the company's moral, social and economic strength, and helps

us to maintain our leading position in the economy, and to cope with the competitive business environment

and with the changes in the electricity market in Israel.

IEC's values are derived from its vision and from the principles laid out by the company founder, Pinchas

Rotenberg. The Code was updated according to the company's Core Values, which were formulated in a wide

collaborative process involving company managers and employees.

The Code of Ethics includes two types of values:

Moral Values – such as integrity, fairness and mutual respect.

Organizational Values – such as excellence, business orientation and environmental responsibility, which the

company considers important and adopts as part of the organizational culture and as factors that help achieve

its goals, objectives and vision.

The company sees great importance in assimilation and implementation of the Code of Ethics and expects

each and every one of us – especially management level – to set an example in keeping the Code and

preventing it from being violated. Commitment to values will help us realize our potential as a solid and

quality company, which also deserves the trust of the public and authorities.

The Code is intended to be our “moral compass”. It provides us with tools and guidelines for dealing with

problems that we encounter in daily life. Our responsibility is to translate the principles of the Code into

actions and decide how to conduct ourselves.

Code Application

The Code applies to the company, directors, managers and employees. Each of us must remember we are

part of the company and must set a personal example through application of the Code.

The Code of Ethics principles and values apply to all subsidiaries and also guide us in our activities abroad.

Compliance with the Law and Procedures

Compliance with laws, regulations and procedures is a prerequisite for ethical conduct. We are obligated to

comply with the provisions of the law in the State of Israel and in every country in which we operate, as far

as they apply to us. In addition, we are committed to following IEC procedures.

Management Responsibility

IEC's management recognizes the importance of adhering to the ethical rules of conduct, which are essential

for maintaining the company's strength as well as its business success. Therefore, the management takes

action to implement the Code among managers and employees throughout the company, in an atmosphere

that will encourage organizational discourse, contemplation and consultation, as well as reporting situations

where violation of the Code is suspected.

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IEC’s Five Core Values

Courageously Changing

Business Approach, Innovation, Efficiency

Committed to our Customers’ Needs

Available Quality Service

Leading Responsibly & Authentically

Integrity, Personal Example

We Care

Fairness, Solidarity

Committed to Professionalism & Excellence

Initiative, Passion, Safety

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Courageously Changing Business Approach * Innovation * Efficiency

Our ability and determination as an organization to renew and change, while showing the courage to initiate,

act and adapt to challenges and opportunities in the business and technological environment will ensure our

resilience and continuity.

We at IEC – in all roles and at all levels – work to perform our tasks effectively, efficiently and with a business

approach. All this in order to achieve appropriate profitability and increase the company's competitiveness,

with the aim of maintaining its financial strength.

We work to foster a culture of innovation and creativity, strive to implement technological innovations, and

are attentive and flexible to the needs of our customers and the needs of the electricity sector.

Committed to our Customers' Needs * Available Quality Service

As part of striving to continue being a leading company in the energy market, we act with dedication to

develop the electricity sector. We are committed to making every effort to ensure available, reliable, high

quality power supply for all company customers. All in accordance with the company's objectives, legal and

regulatory provisions while considering environmental concerns. Understanding the needs of our diverse

customers and providing professional and prompt response are at the center of our activities and

undertakings.

We at IEC strive to meet high standards of service to entities inside and outside the company. We work to

provide reliable, courteous, high quality and considerate service by representatives at call centers, and by all

employees who are in contact with customers.

We aim to provide the best possible service to our customers in times of routine, emergencies and all weather

conditions. We take actions to quickly and efficiently repair malfunctions, while maintaining employee and

public safety as well as complying with security instructions.

Leading Responsibly & Authentically Integrity * Personal Example

As managers and employees in every role and level, we exhibit leadership and take personal and managerial

responsibility for our decisions and actions and their consequences within IEC, as well as with regards to

customers, to the environment and to the community. We do this out of a sense of caring and loyalty to the

company.

We act with integrity and in line with our statements, and set a personal example for those around us. We

are committed to company values and to appropriate representation of the company wherever we operate

and in relation to all company stakeholders. We work in accordance with professional, fair and non-

discriminatory standards, and strive to maintain mutual trust in all our relationships within the company and

with external stakeholders such as customers, suppliers, contractors operating on our sites, business partners

and debt holders.

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We maintain honest, respectful and open communication based on sharing and transparency. We support

employees when their decisions and actions are based on discretion and good faith.

We maintain fair competition and obtain business information only in lawful ways. We respect agreements

and do not abuse our status, stress conditions, knowledge gaps or lack of understanding. Our choice of

suppliers is based only on professional criteria and the law. We work to create a responsible supply chain,

and expect our suppliers to conduct their business fairly - financially, legally, socially and environmentally.

Integrity

We work to preserve the highest standards of integrity. We take measures to prevent corruption. We avoid

offering or accepting bribes – directly or indirectly; any act of embezzlement or fraud; personal exploitation

of the company’s business opportunities, and situations or actions in which there may be a conflict of interest

between our personal benefit and the benefit of the company.

We protect company resources and assets and use them only to promote company goals.

Reliable and Accurate Information

We at IEC provide internal and external parties the necessary and permissible information that is reliable and

accurate, while maintaining the confidentiality of company internal information. The company's publications

as well as reports submitted on its behalf to the authorities are reliable and accurate.

Environmental Responsibility

We at IEC are aware of the impact our activities as an industrial company have on the environment, and adopt

a sustainability approach through commitment to the environment and society in terms of conservation of

natural resources, from a long-term perspective and for the benefit of future generations.

We strive to incorporate environmental considerations into all areas of activity. We maintain environmental

transparency and make information regarding the environment accessible to the public. We work to promote

energy efficiency, to conserve natural resources and strengthen environmental awareness among our

employees and the general public. Our environmental policy is published on the company's website and is

updated periodically.

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We Care Fairness * Solidarity

We at IEC treat all company employees and our diverse customers with respect and fairness, humanity and

care. We are attentive to the needs and difficulties of employees around us, exhibit solidarity and make an

effort to support and assist as much as possible. We demonstrate and encourage openness, tolerance and

expression of diverse opinions.

Respectful Communication

We use clean, appropriate and respectful language in conversations, discussions and correspondence within

the company, as well as in our activities in the public sphere. We ensure respect to human dignity in the

digital arena too – on the internet, in e-mails, corporate portals, forums and social networks. We conduct

pragmatic and courteous discourse, listening and being patient to others, avoiding abusive expressions

towards co-workers, suppliers, customers, partners and competitors. Representing the company at all times

and anywhere, we are aware that our behavior may also have negative consequences for IEC's image.

Collaboration

We at IEC work to promote teamwork and foster a climate of trust, collaboration and a service approach

between employees, managers and units within the company and with external partners. We help colleagues

who are experiencing difficulties at work, and we come to the aid of new employees during their

acclimatization in the company.

Safe, Healthy and Accepting Work Environment

We at IEC work to preserve human life, body and property, and to create a healthy, hygienic and safe working

environment.

We maintain employee rights and take actions to promote a respectful work environment free of threats,

harassment, maltreatment, bullying or violence of any kind and for any reason, such as religious belief, origin,

gender, disability, customs or status. We condemn any manifestation of harassment or intimidation and

undertake to act to eradicate these phenomena.

We take actions to cultivate a diverse and accepting culture and work environment; to develop awareness of

the different other, to create equal opportunities for the entire population, and to promote an accessible

environment tailored for diverse target populations such as women, ultra-Orthodox, members of the

Ethiopian ethnic group, minorities, and people with disabilities.

Respecting the Right to Privacy

We respect everyone’s right to privacy. We conduct ourselves with discretion, with regards to our employees,

our customers and suppliers, and any other entity with whom we come into contact. We take extra care

when handling personal information, and distribute it only to authorized and required entities. We secure

and protect personal information in both the physical and computer environments.

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Appropriate Attire

We dress appropriately, respecting ourselves and our role while being considerate to the people around us.

Responsibility for the Social Community

As a leading company in Israel's economy, we consider ourselves an integral part of the community.

Therefore, we believe in ongoing dialogue with the community and foster partnerships and social

engagement. We promote activities across a range of audiences and ages in the fields of education, science,

safety, health, environment, culture and the arts, as well as other areas. These activities express our

commitment to community work, stemming from awareness of our prominent presence in the environment

and landscape in which we operate.

We are attentive to the needs of special and weak populations, assist and support them. We take actions to

create a climate and a work environment that enable equal opportunities in the recruitment and employment

processes of these populations. We are working to improve accessibility of company services and sites.

Committed to Professionalism & Excellence Initiative * Passion * Safety

At IEC we strive to be the best at what we do, and regard initiative and work passion as vital components to

achieving our goals.

We act in accordance with the best of our professional and business judgment. We encourage excellence and

persistently endeavor to improve performance quality out of loyalty to the company and concern for

maintaining its reputation. We learn lessons from failures as well as success, and strive to find solutions to

any problems that arise.

We emphasize ongoing professional learning in our areas of activity, in order to continue being a leading

company in knowledge and technologies in our fields of business.

Cultivating Human Capital and Promoting Employment Diversity

IEC employees are the source of the company's strength. Recognizing this, we are committed to developing

and maximizing their capabilities and performance, while ensuring equal opportunities.

We promote employment diversity, while maintaining quality and professionalism.

We take actions to manage and preserve knowledge accumulated in the company, and share the knowledge

and experience we have acquired during our years of work with our superiors, co-workers, and subordinates.

We credit employees with the recognition and appreciation they deserve for their work. We see the

importance of providing and receiving ongoing, honest and direct feedback on our work.

Safety

We see the utmost importance in complying with safety rules and in maintaining a safe environment for the

general public, IEC customers and employees. We avoid exposure to risk, and exercise extra caution when

carrying out activities involving possible risks. We ascribe importance to ensuring physical conditions that

maximize safety at work, and to reporting any defect, accident or near accident.

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Code of Ethics in Practice

In all areas of our activities there are laws, regulations, procedures and guidelines valid to the workplace. The

Code of Ethics does not replace all of these but adds to them. You are advised to read the Code carefully and

to openly discuss it with your friends and superiors.

IEC takes actions to integrate and implement the Code's values through educational activities, information

and supervision. We expect each and every one of us, especially executives and directors, to set a personal

example of Code compliance, educate to maintain it, ensure it is implemented and prevent violations. When

making decisions about managers and employees, IEC management will consider the extent to which

managers and employees conduct themselves in accordance with the Code.

We operate accessible mechanisms to consult and report deficiencies and deviations from the Code, while

maintaining discretion and protecting the reporting employee. We will not take any action against those who

have reported in good faith any violation of the Code.

If you have any comments or suggestions for modifying or adding to the Code – please direct them to the

Ethics Officer.

Coping with an Ethical Dilemma

The Code of Ethics does not provide an answer for every situation we may encounter in the workplace. At

times, principles outlined in the Code may lead to different courses of action, and finding the right balance

between them is not easy.

If you are deliberating about how you should behave in any given situation, use the following “rules of

thumb”:

If the case were reversed, would you like your rights, dignity, money or property treated in the same

way you are about to treat others?

Would you feel comfortable if your behavior was made public? Will you and the company be praised

for it, or will you be criticized?

Will you be able to sleep well at night after making your decision?

You may also use the dilemma booklet on the Ethics website. The booklet clarifies how to deal with various

dilemmas that may arise during work.

A basic principle that can guide us when there is no clear reference in the Code, procedures or law to the case

we are faced with, is the rule coined by Hillel the Elder: “Don't do unto others what you don't want done unto

you”.

Consultation and Reporting

When you are confronted with an ethical dilemma or believe that certain actions that have taken place or are

about to take place may conflict with the values of the Code*, you can contact:

Your superiors

Ethics Trustee or member of the Ethics Forum of your division/unit

IEC Ethics Officer/Implementation Manager

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Intranet contact center on the Ethics website, or email address ethics@iec.co.il. Inquiries will be

handled by representatives appointed among members of the Steering Committee for the Ethics Code

Implementation. Referrals will be reviewed while respecting the dignity and privacy of the applicant.

* Inquiries regarding good governance and/or violations of procedures should be directed to the Internal Auditor, Ombudsman, and/or the HR department, as applicable.

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Appendix

Ethics Rules in the Digital Arena

Introduction

The digital arena in general and social media channels in particular – such as Facebook, YouTube, forums,

blogs, portals, WhatsApp, Instagram, e-mail and similar media – have changed the way we communicate

within IEC, and our way of communicating with the public, customers, suppliers and other external parties.

The high speed, ease of distribution, multiplicity of participants, and global access to information published

by means of the new technological tools – all can create a sense of a boundless space, where anything is

possible and permissible. It is especially under these circumstances that we are required to ensure the

internet is a place where discourse is held in a pleasant manner, and be mindful not to disseminate

confidential or sensitive information. Each of us, with little investment of attention and discretion, can

contribute to this.

IEC recognizes the advantages and benefits of the digital world but is also aware of the risks involved. It is

important we be aware that company employees’ online activities may have an effect on their relationships

with other employees, on the company's image and its business relationships with customers, suppliers,

consultants and other parties. We therefore developed rules that will guide and assist us using digital

communication channels responsibly and intelligently.

Application

These rules apply to our behavior within the digital arena in all its uses, in both work and private settings.

Compliance with the Rules, Procedures and Laws

Although it seems as though “anything goes” in the digital arena, activity on any digital channel – including

social networks – is governed by the rules, procedures and terms of use of that media (it is important to read

and become familiar with them), as well as the laws of the state in which it operates and the laws of the State

of Israel. Our activities in the digital arena must also comply with IEC procedures.

We must bear in mind that information we have published can at any given time be used against us (or against

IEC – if the publication was carried out as part of our role on behalf of the company) – and regarded as libel,

defamation, injury to privacy, infringement of securities law (regarding the prohibition of publishing material

information before it has been published in the electronic due diligence system, MAGNA), spam email and

more.

State laws also apply to the use of a “pseudonym”, and the person who published the information can always

be found with relative ease.

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Guiding Principles

Responsibility

We are responsible for the content we write and/or publish in the digital world. Social media channels are

public spaces, and we must assume that everything on the internet is visible to everyone, everywhere.

Content we post will be retained over time and may be accessible to a wide audience within and/or outside

the company, even if we have used privacy settings that these channels allow.

We exercise discretion in selecting the recipients of our e-mails and/or social media messages, as detailed

below in the table of Common Ways to Distribute Information and their Consequences.

Honesty and Integrity

We are committed to the accuracy and truth of what we write, so as not to mislead or harm ourselves or the

company. We think before publishing, and when we are not sure – we do not publish.

When responding or referring to a matter regarding IEC on social media, we mention that we are IEC

employees. However, as long as we do not act within a formal role on behalf of the company, we will

emphasize that we speak only on our own behalf and do not represent the position of IEC.

We refrain as much as possible from making connections that may put us in a conflict of interest, and from

situations that may have the appearance of a conflict of interest, and might cause harm to the company or

its image and expose it to legal claims. In any situation where a conflict of interest may arise, we turn to our

superiors for guidance.

If, following our online activities, we are asked or have questions about company activities, we refer them to

the company's authorized bodies and/or relevant social network pages, which provide a formal response to

these issues.

Mutual Respect

We demonstrate mutual respect, responsibility and restraint in all conversations.

We keep our language clean, appropriate and respectful, courteous and professional and refrain from making

any references that are offensive or negative towards IEC employees, customers, suppliers or other entities.

Right for Privacy

We maintain our privacy to the best of our ability. We are cautious about what personal information we

would like to share online.

We keep the privacy of those we converse with and of other employees and entities.

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Protection of Company Data

We refrain from publishing confidential, sensitive or protected content about IEC, our employees, customers

or suppliers, or any other confidential information contained in IEC information systems or other company

databases.

We refrain from distributing internal information without proper authorization. We adhere to company

instructions regarding data protection.

Common Ways to Distribute Information and their Consequences (In the digital arena)

Options Recipients Proper Judgement

Reply One recipient who sent me a message

Sending a private message to one recipient

Reply All All names from the “To” and “CC” lines

Does the message require widespread distribution?

Forward New recipients

Forwarding information – it is advisable to ask the approval of the correspondence participants so far

Post, Tweet All followers of the sender, in accordance with privacy settings

Does the message require widespread distribution? Are there cultural, organizational or other sensitivities?

Comment

All followers of the sender and the recipient in accordance with privacy settings

Is a public message required? Are there cultural, organizational or other sensitivities?

Share

All followers of the sender and the recipient in accordance with privacy settings

The information will be published on your behalf – will you stand behind the words?

Like

All followers of the sender and the recipient in accordance with privacy settings

Your preference will become public – will you stand behind the words?

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In Conclusion

We are not alone in the digital arena! Even when it seems to be a private group, statements can be saved and

may spread widely at the push of a button. In this manner they might reach places we did not intend them

to and may be misinterpreted. Therefore, the rules should also be kept in private/internal groups.

Whom to Turn to?

If you have any questions or doubts on how to act you can contact your direct supervisor, the legal

department, online communications officer, information and internet security department, sexual

harassment prevention officer, the ethics trustees, or another qualified authority, all in accordance with the

matter at hand.

____________________________________________________________________________________

The Code of Ethics is an internal IEC document. It does not create grounds or grant the right or remedy

to any person or other body. The Code is not part of IEC employment contracts or agreements and

does not change anyone's employment status.

2019

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