annual_report_2019_en

68 Huawei Investment & Holding Co., Ltd.

Huawei conducts business with integrity and conforms

to business ethics standards and all applicable laws

and regulations. This is a key operational principle held

by our highest levels of management. For years, we

have worked hard to build a compliance management

system that aligns with industry best practices and

embeds compliance management into every link of

our business activities and processes. These efforts

continue to this day. Huawei places an emphasis on

and invests heavily into building a culture of integrity.

As such, every employee at Huawei is required to

adhere to our Business Conduct Guidelines (BCGs).

■ We have a Chief Compliance Officer (CCO) to

centrally manage the company’s operational

compliance. The CCO reports to the Board of

Directors. Every business department and subsidiary

of our company has also appointed a compliance

officer and set up their own compliance teams,

taking responsibility for the management of their

own operational compliance work.

■ We identify and assess risk with reference to

applicable laws and regulations and business

scenarios. On top of this, we have set compliance

objectives, developed control measures, and

incorporated them into all of our business activities

and processes. This ensures effective compliance

management and oversight in each business link.

Huawei also conducts checks and audits to verify

the effectiveness of our compliance management

system and continuously optimize the system

through root cause analysis and targeted corrective

action.

■ We attach great importance to and continuously

raise the compliance awareness and capabilities

of our employees. Through training, publicity,

assessments, disciplinary action, and more we push

employees to fully understand both the company’s

and their own responsibilities and obligations

to ensure compliance and incorporate that

understanding into their behavior.

■ With an open mind, we proactively work with

customers, partners, regulators, and other

stakeholders on compliance, and communicate

our compliance principles and practices to them

to constantly enhance mutual understanding and

trust.

Compliance Management in Each Domain

Huawei has long been dedicated to ensuring better

compliance across multiple domains, including but

not limited to trade compliance, financial compliance,

anti-bribery, intellectual property and trade secret

protection, and cyber security and privacy protection.

Compliance requirements have been embedded into

our policies, systems, and business processes.

Trade Compliance

Huawei has long been dedicated to complying with

all applicable laws and regulations of the countries

and regions in which it operates. These include all

applicable export control and sanction laws and

regulations of the UN, China, US, and EU. We have

worked hard for more than 10 years to establish a

mature and sustainable internal system for trade

compliance in line with industry best practices.

We have also brought in industry best practices

and established an integrated trade compliance

management organization within the company.

This organization manages trade compliance across

both group functions and field offices. We have also

established specialist teams in our global offices that

track changes to local laws, integrate trade compliance

into the company’s rules and processes, and manage

Regulations (EAR). This means the export, re-export,

or in-country transfer of any item subject to the EAR

(including hardware, software, and technologies) to

Huawei or its listed affiliates requires a license from

the Department of Commerce.

This has interrupted our business development, but

that impact has been limited. As a staunch advocate

of globalization, we source products from the global

supply chain without depending on any one country

or region, and then build our competitiveness upon

this. Being added to the Entity List does not restrict or

prohibit Huawei from providing products and services

to our customers in accordance with compliance

requirements. Looking to the future, we have

confidence that with assistance from our partners,

we can build an ecosystem for shared success and

development as well as a secure, reliable, competitive,

and healthy industry chain. This will ensure that we

have the capabilities to meet customer requirements

on our sustained supply and delivery, and will

continuously provide premium products, solutions, and

services to customers worldwide.

Regulatory Compliance