As a dynamic business that moves fast, Flex is ever evolving. Information about how we are evolving may be of interest to investors, but not all of it is public.
During the course of our duties at Flex, we may come across material non-public information (MNPI). MNPI can apply to Flex or its customers, suppliers, business affiliates or other third parties.
Trading on the basis of MNPI or tipping MNPI to another person for trading is insider trading. Flex prohibits insider trading, and so does the law. Anyone who tips or trades while in possession of MNPI faces civil and criminal liability. This can include large financial penalties and even time in jail. We never tip or trade on the basis of MNPI, nor should any of our family or household members. We must always speak up through one of our reporting channels if we suspect anyone affiliated with Flex of insider trading.
What is material non-public information?
MNPI is information that has not been made public that a reasonable investor would consider important in making a decision to buy, sell or hold a particular security. Remember, MNPI can apply to information about not only Flex but our customers and suppliers as well.
Examples of MNPI include the following:
- Earnings information and forecasts
- Mergers and acquisitions
- New product development
- Acquisition or loss of a significant contract or customer
- Major pending or threatened litigation or governmental investigations
- Key management changes
- Cybersecurity incidents
My team has been in negotiations with a customer about a new phase of our project. During one of our meetings, someone mentioned that this customer will be merging with another major company in their sector. One of my team members, who was also in the meeting, asked me how I thought a merger might affect our customer’s stock price. I thought this was a strange question, but at the time I just said, “I don’t know.” Should I be concerned that someone on my team may be considering insider trading?
You have reason to be concerned. Nonpublic information about a merger would be of interest to investors. Acting on such information, even about a customer, or tipping outside investors about such information is against Flex policy and the law. Talk to your team member about the issue and be clear about potential consequences. Bring the matter up with a manager as well, or contact the Ethics and Compliance Team with your concerns. We never use MNPI for personal gain.