We have access to and use of Company equipment and assets. Theft, carelessness, and waste of Company assets have a direct impact on our profitability and should be avoided. Any suspected incident of fraud or theft should be immediately reported to a supervisor or, if appropriate, a more senior manager for investigation.

We carefully safeguard our confidential information. Unauthorized use or distribution of confidential information is prohibited and could also be illegal, resulting in civil or even criminal penalties. For a further description of our policy concerning confidential information, see "Fair Competition—Proprietary & Confidential Information" above.

Conflicts of interest are those instances when member personal or financial considerations either directly affect, or could be perceived by others as affecting, whether and how the Company does business.

It is every member's duty to avoid any personal relationships or financial interests that might create even the appearance that we as individual members have conflicting loyalties or are motivated by personal gain in conducting the Company's business. When this occurs, or could have the appearance of occurring, it is crucial that we disclose the information to Company officials. For example, members should disclose to appropriate Company officials when we or our family members have a direct or indirect financial interest or employment relationship with a competitor, supplier or customer of the Company or any of its divisions or subsidiaries. (There are instances when such a relationship is legal, ethical and, therefore, acceptable, but it must be known by Company officials.) Advance disclosure is the best solution - it protects everyone.

We are also expected to devote our entire working time to the performance of our duties to the Company. This is what we are paid to do. Anything that diverts interest, talent and time away from the Company is to be avoided.

In order to protect members and the Company from conflicts of interest, we will:

1. Report any ownership interests in any company with which we do business (any interest in a private company and any stock interest exceeding one percent of the total outstanding stock in a publicly traded company).
     
2. Request approval from management or (in the case of corporate and subsidiary officers) the Board of Directors before entering into any outside business or consulting activity since it might detract from our loyalty and/or service to the Company.
     
3. Refrain from serving on a board of directors of any for-profit organization without the express approval of the Company's management or (in the case of corporate and subsidiary officers) the Board of Directors.
     
4. Not place ourselves in a position where we feel an obligation to conduct business with an organization as the result of receiving personal gifts or favors.
   

We do not personally take opportunities that are discovered through the use of Company property, information or position without the prior consent of the Board of Directors. Our directors, officers and employees are also prohibited from competing with the Company.

Inside Information & Trading in Securities

HNI Corporation common stock is traded on the New York Stock Exchange under the symbol HNI and is registered with the Securities and Exchange Commission (SEC). The Company is required to make filings with the SEC at least once a quarter about its business and financial results. It also issues press releases and makes SEC filings about important events whenever they arise. All information contained in these releases and filings is public information about the Company. All other business information available to members is non-public or inside information.

State and federal laws prohibit trading in common stock or options for stock while in the possession of material inside information. "Material inside information" is any information relating to our Company that has not been disclosed to the public, and there is a substantial likelihood that a reasonable shareholder would consider it important in making an investment decision. Any member, not just officers or managers, may at times possess inside information that is material. In such a case, he or she may not buy or sell the Company's stock until the information is made public or time passes and the information is no longer relevant.

Examples of events that may be considered material include: proposed major acquisitions, sell-offs and joint ventures; significant changes in current or anticipated earnings; upcoming dividend changes; major research or regulatory developments relating to significant new products or processes; proposed major financing by the Company involving sale of stock or other securities; substantial purchases, sales, or write-offs of assets; major contractual arrangements; changes in pricing of key product lines that would have a material effect on earnings; and major developments in litigation.

The securities laws also apply to any trading by any member in the stock or options of any other company when in possession of material inside information about that company that has been provided to HNI Corporation on a confidential basis.

The U.S. Securities and Exchange Commission has given high priority to enforcement of the insider trading laws. Violators can be required to pay civil penalties of up to three times the profit gained or the loss avoided by making an unlawful purchase or sale while possessing material inside information or by unlawfully communicating such information to another, including a spouse or child and other relatives and friends, if a trade results. Violators are also subject to civil suits by parties who are damaged by the violation. In addition, criminal penalties for such violations can result in substantial fines or imprisonment.

To comply with all the laws protecting inside information and trading in securities, we as members will:

1. Not communicate material inside information to others, including spouses, children, and friends and will not ourselves purchase or sell Company common stock or options until such information has been publicly disclosed by the Company and the investing public has had sufficient time to learn of and digest the information.
     
2. Refrain from trading or advising others about trading in securities of any other company when in possession of any material inside information received by our Company on a confidential basis from that company.
     
3. Consult with the Vice President, General Counsel and Secretary (if you are an officer of the Company, a division, or a subsidiary) before trading in HNI Corporation common stock, except for routine purchases under Company "qualified" plans.
   

As our Company grows larger and more decentralized and diverse, an effective and consistent system of administrative and accounting controls is critically important for accurate reporting of the Company's financial results to its shareholders and is required by law. We refer to these systems as internal controls.

Internal controls include maintaining books and records, reporting business transactions promptly and accurately and ensuring that only properly authorized actions are taken. The purpose of internal controls is to provide reasonable assurance that the Company's assets are protected and properly used. They act as a system of checks and balances to help ensure that administrative and accounting policies are followed consistently throughout the entire Company. In addition to being a good business practice, the Company policy on internal controls also promotes compliance with the securities and tax laws.

Management members are responsible for internal controls in their areas of responsibility. They must assure that all assets and transactions are recorded on the Company's books and records in accordance with proper accounting practices and procedures. Management members may not allow any unrecorded or "off book" funds or accounts to be established or maintained for any purpose, nor permit records to be falsified in any manner.

In fulfilling this obligation, management members and other members with these responsibilities must:

1. Establish reasonable procedures for carrying out Company policies and preventing deviations.
     
2. Ensure that business transactions and access to Company assets are conducted only by members who are properly authorized.
     
3. Make sure that business transactions are recorded in writing promptly and accurately on the Company's books and records in order to ensure that its financial statements fairly reflect all business activities.
     
4. Protect Company data that is transmitted and/or stored electronically from disasters, misuse and unauthorized access through measures such as appropriate back-up systems, firewalls and effective disaster planning.
   

We are a public company and as a result file reports and other documents with the Securities and Exchange Commission (SEC) and the stock exchanges on which our securities trade. As well, we issue press releases and make other public statements that include financial and other information about our business, financial condition and results of operations. We endeavor to make full, fair, accurate, timely and understandable disclosure in reports and documents we file with, or submit to, the SEC and in our press releases and public communications.

We require cooperation and open communication with our internal and outside auditors. It is illegal to take any action to fraudulently influence, coerce, manipulate, or mislead any internal or external auditor engaged in the performance of an audit of our financial statements.

The laws and regulations applicable to filings made with the SEC, including those applicable to accounting matters, are complex. While the ultimate responsibility for the information included in these reports rests with senior management, numerous other employees participate in the preparation of these reports or provide information included in these reports. We maintain disclosure controls and procedures to ensure that the information included in the reports that we file or submit to the SEC is collected and communicated to senior management in order to permit timely disclosure of the required information.

If you are requested to provide, review or certify information in connection with our disclosure controls and procedures, you must provide the requested information or otherwise respond in a full, accurate and timely manner. Moreover, even in the absence of a specific request, you should report any information that you believe should be considered for disclosure in our reports to the SEC.

If you have questions or are uncertain as to how our disclosure controls and procedures may apply in a specific circumstance, promptly contact your supervisor or a more senior manager. We want you to ask questions and seek advice.